Text: H.R.4530 — 115th Congress (2017-2018)All Information (Except Text)

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Introduced in House (12/04/2017)


115th CONGRESS
1st Session
H. R. 4530


To provide that a person or governmental entity is not subject to civil or criminal liability under Federal law for gaming activity that is lawful under State law, and for other purposes.


IN THE HOUSE OF REPRESENTATIVES

December 4, 2017

Mr. Pallone introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned


A BILL

To provide that a person or governmental entity is not subject to civil or criminal liability under Federal law for gaming activity that is lawful under State law, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Gaming Accountability and Modernization Enhancement Act of 2017” or the “GAME Act of 2017”.

SEC. 2. No Federal liability for gaming activity lawful under State law.

(a) In general.—Except as provided in subsection (b) and notwithstanding any other law, a person or governmental entity is not subject to civil or criminal liability under any provision of Federal law for engaging through a gaming facility in gaming activity that is lawful under the law of the State in which such person or governmental entity engages in such activity.

(b) Minimum consumer protections.—Subsection (a) does not apply to a person or governmental entity with respect to gaming activity engaged in by the person or governmental entity in a State unless the law of the State provides for consumer protections with respect to such activity that include the following:

(1) LICENSING OF GAMING FACILITIES.—Appropriate licensing or certification mechanisms for gaming facilities.

(2) REPORTING REQUIREMENTS FOR GAMING FACILITIES.—Appropriate mechanisms, including reporting requirements, to ensure, to a reasonable degree of certainty, that gaming facilities are operating in a fair and transparent manner.

(3) PROHIBITION OF UNDERAGE GAMING.—Appropriate safeguards to ensure, to a reasonable degree of certainty, that an individual placing a bet or wager is not under the minimum legal age for placing such a bet or wager established by the State.

(4) PROHIBITED LOCATIONS.—Appropriate safeguards to ensure, to a reasonable degree of certainty, that an individual placing a bet or wager is physically located in a jurisdiction that has not prohibited such bet or wager at the time the bet or wager is placed.

(5) MANDATORY COLLECTION OR REPORTING OF CUSTOMER TAXES.—Appropriate mechanisms to ensure, to a reasonable degree of certainty, that all Federal and State taxes relating to the placement of a bet or wager are collected from or reported by the person placing such bet or wager, as required by law, at the time of any payment of the proceeds of such bet or wager.

(6) MANDATORY COLLECTION OR REPORTING OF TAXES ON OPERATOR OF GAMING FACILITY.—Appropriate mechanisms to ensure that—

(A) all Federal and State taxes relating to the operation of a gaming facility are collected or reported, as required by law; and

(B) adequate records are maintained to enable later audit or verification of such collection or reporting.

(7) SAFEGUARDS AGAINST FINANCIAL CRIME.—Appropriate safeguards to prevent, to a reasonable degree of certainty, fraud, money laundering, and financing of terrorism.

(8) SAFEGUARDS AGAINST COMPULSIVE PLAY.—Appropriate safeguards to combat compulsive gambling.

(9) PRIVACY AND DATA SECURITY SAFEGUARDS.—Appropriate safeguards to protect, to a reasonable degree of certainty, the privacy and online security of any person placing a bet or wager.

(10) PREVENTION OF CHEATING.—Appropriate safeguards to ensure, to a reasonable degree of certainty, that a bet or wager is fair and honest, and to prevent, to a reasonable degree of certainty, cheating (including collusion and the use of a cheating device).

(11) INTEGRITY SAFEGUARDS.—In a State in which betting or wagering relating to sporting events is lawful under the law of the State, appropriate safeguards to ensure, to a reasonable degree of certainty, the integrity of the sporting event, including limitations on a bet or wager accepted during the sporting event.

(12) REDRESS.—Appropriate recourse mechanisms for persons affected by noncompliance with the consumer protections required by this subsection and any other consumer protections implemented by the State with respect to the placement of bets or wagers or the operation of gaming facilities.

(c) Federal Trade Commission filing.—A gaming facility that accepts bets or wagers from persons in more than one State shall submit to the Commission a description of how the gaming facility has complied with the law of each such State with respect to each of the consumer protections described in subsection (b) that is provided for by the law of such State.

SEC. 3. Use of credit card to verify age prohibited.

It shall be unlawful for any person to accept a credit card payment as a method of age verification for placing any bet or wager.

SEC. 4. Enforcement.

(a) By Federal Trade Commission.—

(1) UNFAIR OR DECEPTIVE ACTS OR PRACTICES.—A violation of section 2(c) or 3, or a rule prescribed under such section, shall be treated as a violation of a rule defining an unfair or deceptive act or practice prescribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).

(2) POWERS OF COMMISSION.—The Commission shall enforce this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms and provisions of the Federal Trade Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a part of this Act. Any person who violates section 2(c) or 3, or a rule prescribed under such section, shall be subject to the penalties and entitled to the privileges and immunities provided in the Federal Trade Commission Act.

(b) By State attorneys general.—

(1) IN GENERAL.—If the attorney general of a State has reason to believe that any person has violated or is violating section 2(c) or 3, or a rule prescribed under such section, the attorney general, in addition to any authority the attorney general may have to bring an action in State court under the consumer protection law of the State, may bring a civil action in any appropriate United States district court or in any other court of competent jurisdiction, including a State court, to—

(A) enjoin further such violation by the defendant;

(B) enforce compliance with such section or such rule;

(C) obtain civil penalties; or

(D) obtain damages, restitution, or other compensation on behalf of residents of the State.

(2) NOTICE AND INTERVENTION BY FTC.—The attorney general of a State shall provide prior written notice of any action under paragraph (1) to the Commission and provide the Commission with a copy of the complaint in the action, except in any case in which such prior notice is not feasible, in which case the attorney general shall serve such notice immediately upon instituting such action. The Commission shall have the right—

(A) to intervene in the action;

(B) upon so intervening, to be heard on all matters arising therein; and

(C) to file petitions for appeal.

(3) LIMITATION ON STATE ACTION WHILE FEDERAL ACTION IS PENDING.—If the Commission has instituted a civil action for violation of section 2(c) or 3 (including a rule prescribed under such section), no State attorney general may bring an action under this subsection during the pendency of that action against any defendant named in the complaint of the Commission for any violation of such section (including such rule) alleged in the complaint.

(4) ATTORNEY GENERAL DEFINED.—In this subsection, the term “attorney general” means, with respect to a State, the attorney general or chief law enforcement officer of the State, or another official or agency designated by the State to bring civil actions on behalf of the State or the residents of the State.

(c) Rulemaking.—The Commission may prescribe rules under section 553 of title 5, United States Code, to implement sections 2(c) and 3.

(d) Preservation of authority of Commission.—Nothing in this Act shall be construed in any way to limit or affect the authority of the Commission under any other provision of law.

SEC. 5. Gambling addiction prevention and treatment.

(a) Authority To address gambling in Department of Health and Human Services authorities.—Section 501(d) of the Public Health Service Act (42 U.S.C. 290aa(d)) is amended—

(1) by striking “and” at the end of paragraph (24);

(2) by striking the period at the end of paragraph (25) and inserting “; and”; and

(3) by adding at the end the following:

“(26) establish and implement programs for prevention and treatment of gambling addiction.”.

(b) Advisory Committee.—

(1) ESTABLISHMENT.—The Secretary may establish a Gambling Addiction Research Advisory Committee (in this paragraph referred to as the “Committee”) within the National Institutes of Health to coordinate research conducted or supported by the Department of Health and Human Services on gambling addiction.

(2) MEMBERSHIP.—The Committee shall include representatives of the National Institute on Drug Abuse, the National Institute of Mental Health, the National Institute on Alcohol Abuse and Alcoholism, the Indian Health Service, the Substance Abuse and Mental Health Services Administration, and the Centers for Disease Control and Prevention.

(3) ANNUAL REPORT.—The Committee shall prepare and submit to the Secretary an annual report on the research described in paragraph (1).

(c) Surveillance of gambling addiction.—Title III of the Public Health Service Act is amended by inserting after section 317T of such Act (42 U.S.C. 247b–22) the following:

“SEC. 317U. Surveillance of gambling addiction.

“(a) In general.—The Secretary, acting through the Director of the Centers for Disease Control and Prevention and in coordination with other appropriate agencies, shall, as appropriate—

“(1) enhance and expand infrastructure and activities to track the epidemiology of gambling addiction; and

“(2) incorporate information obtained through such infrastructure and activities into an integrated surveillance system, which may consist of or include a registry, to be known as the National Gambling Addiction Surveillance System.

“(b) Research.—The Secretary shall ensure that the National Gambling Addiction Surveillance System, if established, is designed in a manner that facilitates further research on gambling addiction.

“(c) Public access.—Subject to subsection (d), the Secretary shall ensure that information and analysis in the National Gambling Addiction Surveillance System, if established, are available, as appropriate, to the public, including researchers.

“(d) Privacy.—The Secretary shall ensure that information and analysis in the National Gambling Addiction Surveillance System, if established, are made available only to the extent permitted by applicable Federal and State law, and in a manner that protects personal privacy, to the extent required by applicable Federal and State privacy law, at a minimum.

“(e) Authorization of appropriations.—To carry out this section, there is authorized to be appropriated $5,000,000 for each of fiscal years 2018 through 2022.”.

SEC. 6. Definitions.

In this Act:

(1) AMATEUR SPORTS ORGANIZATION.—The term “amateur sports organization” means—

(A) a person or governmental entity that sponsors, organizes, schedules, or conducts a competitive game in which one or more amateur athletes participate; or

(B) a league or association of persons or governmental entities described in subparagraph (A).

(2) BET OR WAGER.—

(A) IN GENERAL.—The term “bet or wager” means the staking or risking by any person of something of value, including virtual currency and actual or virtual items that can be sold or otherwise exchanged for cash at the gaming facility or elsewhere, upon the outcome of a contest of others, a sporting event, a game subject to chance, or a game in which the outcomes reflect the relative knowledge and skill of the participants, upon an agreement or understanding that the person or another person will receive something of value in the event of a certain outcome.

(B) INCLUSIONS.—Such term includes the following:

(i) The purchase of a chance or opportunity to win a lottery or other prize.

(ii) Any lottery, sweepstakes, or other betting, gambling, or wagering scheme based, directly or indirectly (through the use of geographical references or otherwise), on one or more competitive games in which amateur or professional athletes participate, or are intended to participate, or on one or more performances of such athletes in such games.

(iii) Any instructions or information pertaining to the establishment or movement of funds by the bettor or customer in, to, or from an account with the business of betting or wagering.

(iv) Participation in any fantasy or simulation sports or e-sports game or contest, including those in which (if the game or contest involves a team or teams) no fantasy or simulation sports team is based on the current membership of an actual team that is a member of an amateur sports organization or professional sports organization and including those that meet any of the following conditions:

(I) All prizes and awards offered to winning participants are established and made known to the participants in advance of the game or contest and their value is not determined by the number of participants or the amount of any fees paid by those participants.

(II) All winning outcomes reflect the relative knowledge and skill of the participants and are determined predominantly by accumulated statistical results of the performance of individuals (athletes in the case of sports events) in multiple real-world sporting or other events.

(III) No winning outcome is based—

(aa) on the score, point-spread, or any performance or performances of any single real-world team or any combination of such teams; or

(bb) solely on any single performance of an individual athlete in any single real-world sporting or other event.

(C) EXCLUSIONS.—Such term does not include the following:

(i) Any activity governed by the securities laws (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))) for the purchase or sale of securities (as defined in such section).

(ii) Any transaction conducted on or subject to the rules of a registered entity or exempt board of trade under the Commodity Exchange Act (7 U.S.C. 1 et seq.).

(iii) Any over-the-counter derivative instrument.

(iv) Any other transaction that—

(I) is excluded or exempt from regulation under the Commodity Exchange Act; or

(II) is exempt from State gaming or bucket shop laws under section 12(e) of the Commodity Exchange Act (7 U.S.C. 16(e)) or section 28(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78bb(a)).

(v) Any contract of indemnity or guarantee.

(vi) Any contract for insurance.

(vii) Any deposit or other transaction with an insured depository institution.

(viii) Participation in any game or contest in which participants do not stake or risk anything of value other than—

(I) personal efforts of the participants in playing the game or contest or obtaining access to the internet; or

(II) points or credits that the sponsor of the game or contest provides to participants free of charge that can be used or redeemed only for participation in games or contests offered by the sponsor and that cannot be sold or otherwise exchanged for cash at the gaming facility or elsewhere.

(3) BUSINESS OF BETTING OR WAGERING.—The term “business of betting or wagering” does not include the activities of a person who is—

(A) a financial transaction provider, to the extent such person is acting as such a provider, except with respect to an activity described in paragraph (10)(C)(ii); or

(B) a provider of an interactive computer service or telecommunications service, to the extent such person is acting as such a provider, except with respect to an activity described in paragraph (10)(C)(ii).

(4) COMMISSION.—The term “Commission” means the Federal Trade Commission.

(5) CREDIT; CREDITOR; AND CARD ISSUER.—The terms “credit”, “creditor”, and “card issuer” have the meanings given the terms in section 103 of the Truth in Lending Act (15 U.S.C. 1602).

(6) ELECTRONIC FUND TRANSFER.—The term “electronic fund transfer”—

(A) has the meaning given the term in section 903 of the Electronic Fund Transfer Act (15 U.S.C. 1693a), except that the term includes transfers that would otherwise be excluded under section 903(7)(E) of that Act; and

(B) includes any fund transfer covered by Article 4A of the Uniform Commercial Code, as in effect in any State.

(7) E-SPORTS.—The term “e-sports” means a multiplayer video game played competitively for spectators.

(8) FINANCIAL INSTITUTION.—The term “financial institution” has the meaning given the term in section 903 of the Electronic Fund Transfer Act (15 U.S.C. 1693a), except that such term does not include a casino, sports book, or other business at or through which a bet or wager may be placed or received.

(9) FINANCIAL TRANSACTION PROVIDER.—The term “financial transaction provider” means a creditor, card issuer, financial institution, operator of a terminal at which an electronic fund transfer may be initiated, money transmitting business, or international, national, regional, or local payment network utilized to effect a credit transaction, electronic fund transfer, stored value product transaction, or money transmitting service, or a participant in such network, or other participant in a system utilized by an entity described in this paragraph that could be utilized in connection with, or to facilitate, any transaction described in paragraph (10)(A)(iii).

(10) GAMING ACTIVITY.—

(A) IN GENERAL.—The term “gaming activity” means—

(i) placing, receiving, or otherwise transmitting a bet or wager;

(ii) transmitting—

(I) information assisting in the placing of a bet or wager; or

(II) a wire communication which entitles the recipient to receive money or credit—

(aa) as a result of a bet or wager; or

(bb) for information assisting in the placing of a bet or wager;

(iii) the knowing acceptance, by any person engaged in the business of betting or wagering, in connection with the placing, receiving, or otherwise transmitting of a bet or wager by another person, of credit or payment of any type; or

(iv) sponsoring, operating, advertising, or promoting (or, in the case of a governmental entity, sponsoring, operating, advertising, promoting, licensing, or authorizing by law or compact) a lottery, sweepstakes, or other betting, gambling, or wagering scheme based, directly or indirectly (through the use of geographical references or otherwise), on one or more competitive games in which amateur or professional athletes participate, or are intended to participate, or on one or more performances of such athletes in such games.

(B) EXCLUSIONS.—Such term does not include any activity or transaction described in paragraph (2)(C) or, in the case of a contract or other instrument described in such paragraph, any activity or transaction relating to such contract or other instrument.

(C) FINANCIAL TRANSACTION PROVIDERS AND PROVIDERS OF INTERACTIVE COMPUTER SERVICE OR TELECOMMUNICATIONS SERVICE.—

(i) GENERALLY EXCLUDED.—Except as provided in clause (ii), such term does not include any activity of a person who is—

(I) a financial transaction provider, to the extent such person is acting as such a provider; or

(II) a provider of an interactive computer service or telecommunications service, to the extent such person is acting as such a provider.

(ii) OPERATION OF GAMING WEBSITES OR OTHER FACILITIES.—Notwithstanding clause (i), such term includes an activity of a financial transaction provider or provider of an interactive computer service or telecommunications service to the extent that such provider has actual knowledge and control of bets or wagers and—

(I) operates, manages, supervises, or directs a website or other facility through which a bet or wager is initiated, received, or otherwise made, whether transmitted by telephone, internet, satellite, or other wire or wireless communication facility, service, or medium and whether or not the transmissions cross State boundaries; or

(II) owns or controls, or is owned or controlled by, any person who operates, manages, supervises, or directs a website or other facility through which a bet or wager is initiated, received, or otherwise made, whether transmitted by telephone, internet, satellite, or other wire or wireless communication facility, service, or medium and whether or not the transmissions cross State boundaries.

(11) GAMING FACILITY.—

(A) IN GENERAL.—The term “gaming facility” means—

(i) a facility that permits bets or wagers to be placed in a casino, on a riverboat, at a race track, or in another facility that hosts gaming activity in one physical location; or

(ii) a website or other facility through which a bet or wager is initiated, received, or otherwise made, whether transmitted by telephone, internet, satellite, or other wire or wireless communication facility, service, or medium and whether or not the transmissions cross State boundaries.

(B) EXCLUSIONS.—Such term does not include any facility to the extent such facility is engaged in an activity or transaction that is excluded from the definition of “gaming activity” by subparagraph (B) or (C) of paragraph (10).

(12) GOVERNMENTAL ENTITY.—The term “governmental entity” means a State, a political subdivision of a State, or an entity or organization, including an entity or organization described in section 4(5) of the Indian Gaming Regulatory Act (25 U.S.C. 2703(5)), that has governmental authority within the territorial boundaries of the United States, including on lands described in section 4(4) of such Act (25 U.S.C. 2703(4)).

(13) INSURED DEPOSITORY INSTITUTION.—The term “insured depository institution”—

(A) has the meaning given the term in section 3(c) of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)); and

(B) includes an insured credit union (as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752)).

(14) INTERACTIVE COMPUTER SERVICE.—The term “interactive computer service” has the meaning given such term in section 230(f) of the Communications Act of 1934 (47 U.S.C. 230(f)).

(15) MONEY TRANSMITTING BUSINESS AND MONEY TRANSMITTING SERVICE.—The terms “money transmitting business” and “money transmitting service” have the meanings given the terms in section 5330(d) of title 31, United States Code (determined without regard to any regulations prescribed by the Secretary of the Treasury thereunder).

(16) PROFESSIONAL SPORTS ORGANIZATION.—The term “professional sports organization” means—

(A) a person or governmental entity that sponsors, organizes, schedules, or conducts a competitive game in which one or more professional athletes participate; or

(B) a league or association of persons or governmental entities described in subparagraph (A).

(17) SECRETARY.—The term “Secretary” means the Secretary of Health and Human Services.

(18) STATE.—The term “State” means each of the several States, the District of Columbia, each commonwealth, territory, or possession of the United States, and each federally recognized Indian Tribe.

(19) TELECOMMUNICATIONS SERVICE.—The term “telecommunications service” has the meaning given such term in section 3 of the Communications Act of 1934 (47 U.S.C. 153).

SEC. 7. Effect on other law.

(a) No effect on State law or Tribal-State compacts relating to gambling.—Nothing in this Act shall be construed as altering, limiting, or extending any State law or Tribal-State compact prohibiting, permitting, or regulating gambling within the United States.

(b) No effect on Indian Gaming Regulatory Act.—Nothing in this Act shall be construed to have any effect on a gaming activity within the scope of the Indian Gaming Regulatory Act (25 U.S.C. 2701 et seq.), any successor provision of such Act, or any Tribal-State compact or authority pursuant to such Act or successor provision.

(c) No effect on Illegal Gambling Business Act.—Nothing in this Act shall be construed to supersede or otherwise limit section 1955 of title 18, United States Code (commonly referred to as the Illegal Gambling Business Act).

(d) No effect on Interstate Horse Racing Act.—Nothing in this Act shall be construed to supersede or otherwise limit the Interstate Horse Racing Act of 1978 (15 U.S.C. 3001 et seq.).

SEC. 8. Repeal.

(a) In general.—Chapter 178 of title 28, United States Code (commonly referred to as the Professional and Amateur Sports Protection Act) is repealed.

(b) Clerical amendment.—The table of chapters for part VI of title 28, United States Code, is amended by striking the item relating to chapter 178.


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