New Jersey's Bill S-490 Permits Casinos to Offer Internet Wagering

In a boost to New Jersey's casino and tourism industries, the state has enacted three new laws, as well as Bill S-490, which is pending the governor's signature. Links to additional Alerts summarizing the other pieces of legislation follow this piece.

On January 10, 2011, both houses of the New Jersey Legislature passed and sent to Gov. Chris Christie a bill known as S-490, which would permit New Jersey casino licensees to offer Internet wagering to New Jersey residents. Initially, as passed by the state Senate, the bill provided that New Jersey casino licensees could accept Internet wagers from residents of New Jersey and from patrons outside of the United States. The General Assembly, however, amended this bill to remove the provision allowing wagers from outside the United States. The Senate concurred with this amendment, thus limiting the customer pool to New Jersey residents. Governor Christie has not yet acted on this bill.

Under S-490, the Casino Control Commission ("Commission")1 will establish a division of Internet wagering that will be responsible for promulgating regulations to govern the conduct of Internet wagering, including the technical standards to be applied to all equipment and software to be used in Internet wagering. Casino licensees who wish to offer Internet wagering to patrons will need to apply to the Commission for an Internet wagering permit, which is subject to annual renewal. At a minimum, this application will need to establish the presence of appropriate internal controls over Internet wagering and the qualifications of all persons involved in the proposed Internet wagering operation. The licensee will also be required to establish that the operation itself will be housed in a secure area within the licensee's casino-hotel or in another secure location in Atlantic City.

The equipment and software to be used by the licensee in the conduct of Internet wagering must be submitted to and approved by the Division of Gaming Enforcement ("Division") and Commission. An analysis will be conducted to determine whether the equipment and software comply with the regulations to be established by the Commission. The Division is permitted to retain the services of a private laboratory to conduct testing (as long as that laboratory has a gaming-related casino service industry enterprise license).

Once the licensee is issued a permit and the equipment and software have been approved, a licensee may offer an Internet version of...