U.S. Betting Operators Facing Legislative Pushback Over Advertising

February 14, 2023
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The recent introduction of federal legislation to ban sports-betting advertising underscores a wider 2023 trend of U.S. lawmakers putting the industry on the defensive against proposed marketing restrictions.

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The recent introduction of federal legislation to ban sports-betting advertising underscores a wider 2023 trend of U.S. lawmakers putting the industry on the defensive against proposed marketing restrictions.

The bill proposed on February 9 in the U.S. House of Representatives by Democrat Paul Tonko of New York is the first piece of federal legislation to follow a global trend that has seen policymakers in the likes of the Netherlands, Sweden and other countries move to severely curtail sports-betting advertising soon after liberalization.

In a statement announcing the so-called Betting On Our Future Act, Tonko said the five years since the U.S. Supreme Court’s overturning of a federal ban on sports wagering had seen “these unfettered advertisements … run rampant, with betting companies shelling out billions to reach every screen across America.”

Tonko added that “Congress must take the necessary steps to reel in an industry with the power to inflict real, widespread harm on the American people.”

In the admittedly unlikely event it passes the House and Senate and survives potential legal challenge, Tonko’s bill would establish a blanket prohibition by banning all betting ads on TV, radio and digital media across the United States.

But it is far from the only piece of legislation so far in 2023 that indicates disquiet among U.S. lawmakers regarding advertising.

Sports-betting advocates have generally been able to stay on the offense in the nearly five years since the Supreme Court ruling, successfully lobbying to open up an impressive 25 states and counting to lawful mobile wagering.

This year, however, industry proponents may have to play defense on several fronts following the introduction of various state-level proposals to impose new limits related to advertising and potential risks of problem gambling.

A resolution filed last year by the chair of the New Jersey Assembly’s gaming committee would formally condemn the “over-proliferation” of ads in the state and urge industry restraint in the area, although it would not actually impose any new regulatory restrictions.

In Connecticut, however, a new bill introduced this month by the legislature’s Joint Public Safety and Security Committee would impose an Ontario-style policy to prohibit any online casino or sports-betting ads that offer or advertise “for a financial enticement to participate in such gaming or wagering.”

A set of similar bills introduced in recent days in Maryland and West Virginia would oblige regulators to establish standards for sports-betting content produced for operators by their influencers or affiliates and require operators to undergo an evaluation of that content by independent experts.

Further bills introduced in Maryland’s House of Delegates and Senate would separately ban any marketing partnerships between in-state colleges and sportsbooks.

Elsewhere, Ohio’s governor is now seeking to raise taxes and impose a statutory prohibition on the use of terms such as “risk-free” in sports-betting marketing.

Legislation filed by one Illinois state senator would require a pop-up problem gambling warning every tenth wager placed by a bettor, with New York lawmakers also introducing several problem gambling-related bills this year targeted at mobile sports wagering.

The uptick in legislative activity all follows proposed regulations in Maine that would equally ban any bonus offerings in advertising and limit televised ads strictly to the broadcasts of live sporting events.

It should be stressed that it is far from clear whether any of these state or federal proposals will be passed into law this year, or how they might evolve as industry operators and suppliers gain the opportunity to provide testimony before the appropriate legislative committees.

Most major sportsbook operators have already voluntarily dropped terms such as “risk-free bets” from their marketing, agreed to refrain from marketing at college sports stadiums, or both.

In a statement on Tonko’s federal bill, the American Gaming Association highlighted the industry’s “proactive efforts” that include establishing a Responsible Marketing Code for Sports Wagering, and stated that as sports betting has expanded there has “never been more attention paid or resources invested in responsible gaming and problem gambling resources.”

It is also apparent that many state lawmakers remain enthusiastic about legal sports betting.

For every bill seeking to restrict sports betting, there are other measures being taken by representatives and senators seeking to either authorize the activity in later-adopting states or expand the scope of their markets.

Still, few observers of international policy trends will be surprised to see the increase in legislative and regulatory activity regarding advertising, given the direction of travel across Europe, Australia and now in Canada, where Ontario operators equally expect to confront potential new marketing restrictions this year.

In most states where sports wagering has been legalized, “little time, recognition, or debate was extended to the areas of responsible gambling, advertising, and how promotions/bonuses might have an impact on gambling related harm and the wider public,” Brianne Doura-Schawohl, an independent consultant and responsible gambling policy advocate, told VIXIO GamblingCompliance.

“Consumers are becoming increasingly concerned with the content and saturation of advertising and demanding answers from policymakers. Additionally, policymakers are increasingly hearing from problem gambling advocates that demand for services is rising and that more funding and services are needed. As the market continues to mature, more questions continue to arise,” Doura-Schawohl said.

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