In the wake of the Supreme Court’s decision to overturn the Professional and Amateur Sports Protection Act of 1992 (“PASPA”), New Jersey has passed legislation authorizing sports betting within its state. Though the passage of this legislation is notable given that New Jersey was the state which challenged PASPA to the Supreme Court, its exclusion (and inclusion) of esports has been a hot topic of discussion throughout the industry.
The bill signed into law on June 11, by Phil Murphy, New Jersey’s Governor, appeared to specifically exclude esports betting, stating that “A prohibited sports event includes all high school sports events, electronic sports, and competitive video games.” This language was widely interpreted to mean that esports events were considered prohibited sports events under the legislation.
However, it appears that the esports betting ban was not intended by the legislation, as the State’s Division of Gaming Enforcement has recently established emergency regulations which clarify that the legislation was not meant to ban betting on all esports competitions.
On June 14, three days after the sports betting legislation was signed, New Jersey’s Division of Gaming Enforcement, the state’s gambling authority, issued emergency regulations which clarify the State’s stance on esports betting. The emergency regulations specify that betting on “high school electronic sports and high school competitive video game events” (emphasis added) are prohibited.
Additionally, the emergency regulations explicitly include “electronic sports and competitive video game events” as a permissible “Sports event” under the legislation, so long as the esports event is not sponsored by a high school, involve a high school team, or involve a player under the age of 18. Despite the clarification that it is impermissible to bet on high school esports events, the 18-year-old age requirement of an event’s players will prevent betting upon some pro esports events nonetheless, as a small number of pro players are under 18.
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The emergency regulations are a welcomed change, as Atlantic City and its casinos, who stand the most to benefit from sports betting in the state, have sought to host more esports events. The last two years alone have seen the city and its casinos host the Gears of War Pro Circuit: Atlantic City Open, the Rainbow Six Pro League’s finals, and Royal Flush, a pro Smash Bros. event.
With an estimated global revenue of $6.7 billion in 2018, esports betting can be a lucrative offering to sports books in New Jersey. Time will tell if esports is embraced by New Jersey sports books, though the state certainly has cleared the path for them to do so.