The Social Gaming Leadership Alliance (SGLA) has called on lawmakers to reconsider the terms of New Jersey’s sweepstakes ban.
The state’s Assembly and Senate quickly passed A5547 with strong majorities, and now only a signature from Gov. Phil Murphy is needed to rubber-stamp a ban on the vertical.
However, the SGLA, a coalition of sweepstakes operators which includes the likes of VGW, PLAYSTUDIOS and Yellow Social Interactive, has urged the New Jersey legislature to set aside the bill and work alongside the SGLA to develop “common sense” legislation.
The New Jersey bill targets any form of online gambling that utilises a dual-currency system, as well as those that promote such operators. However, exceptions have been embedded within the bill to ensure entities like fast-food companies and grocers can still run contests.
Economic opportunities
The SGLA argues that its partners employ a “freemium business model” distinct from online gambling that allows free play, but also features optional additional enhancements that can be purchased, likening the system to that of popular online games such as Candy Crush.
This, however, appears not to be the view taken by the Garden State and many other states across the US. Following the decisions of its state legislature, New Jersey became the sixth state to pass state legislature intended to curtail the sweeps industry.
Bills in Montana and Connecticut have been signed into law, while legislation in Nevada and New York awaits the signature of their respective governors. Louisiana also passed a similar bill, but it was vetoed by Gov. Jeff Landry.
In testimony submitted as part of a Senate committee hearing on sweeps last week, the SGLA pointed to the economic opportunity that properly regulating the sweeps market could offer a state like New Jersey.
The organisation told regulators: “SGLA partners are ready and open to sensible regulation and taxation frameworks that can benefit hard-working constituents in New Jersey.
“A well-designed regulatory structure could provide appropriate oversight, mandate robust consumer safeguards, and generate meaningful tax revenue while preserving innovation and consumer choice.”
This sentiment was also shared by Adam Pliska, the President and CEO of the World Poker Tour (WPT), who made a last-minute plea to lawmakers to reconsider, arguing that the WPT’s push into sweepstakes is helping to bring people back to land-based casinos in the state
He also suggested that New Jersey could seek to collect sales tax from online sweepstakes coin purchases as a source of income.
California weighs in
Sweepstakes have been heavily scrutinised across the US, with the vertical hit with an unexpected blow earlier this month in California when a revamped bill took aim at the sector.
Initially intended to tweak California’s tribal-state compact laws, Assembly member Avelino Valencia has overhauled Assembly Bill 831 into a ban on sweeps. The bill has the backing of the California Nations Indian Gaming Association (CNIGA),
The new version seeks to amend California’s Business and Professions Code and Penal Code to make it unlawful to operate, conduct, offer, or promote an online sweepstakes game.
Although the bill still has a long way to go before it becomes a law, talk of a potential ban in California will have operators nervous, given the Golden State’s status as the most populous state in the US.
The bill will now be discussed on 8 July by the state’s Senate Governmental Organisation Committee.
