Va. Code Ann. tit. 58.1, ch. 42

in effect

Va. Code Ann. § 58.1-4200 Definitions

As used in this chapter, unless the context requires otherwise: "Board" means the Virginia Lottery Board established in the Virginia Lottery Law (§ 58.1-4000 et seq.). "Confidential information" means information related to the play of a fantasy contest by fantasy contest players obtained as a result of or by virtue of a person's employment. "Department" means the independent agency responsible for the administration of the Virginia Lottery pursuant to Article 1 (§ 58.1-4000 et seq.) of Chapter 40 and the regulation of sports betting pursuant to Article 2 (§ 58.1-4030 et seq.) of Chapter 40, casino gaming pursuant to Chapter 41 (§ 58.1-4100 et seq.), and fantasy contests pursuant to this chapter. "Entry fee" means cash or cash equivalent that is required to be paid by a fantasy contest player to a fantasy contest operator in order to compete in a fantasy contest. "Fantasy contest" includes any online fantasy or simulated game or contest with an entry fee in which (i) two or more fantasy contest players compete against each other; (ii) the value of all prizes and awards offered to winning players is established and made known to the players in advance of the contest; (iii) all winning outcomes reflect the relative knowledge and skill of the players and shall be determined by accumulated statistical results of the performance of individuals, including athletes in the case of sports events; (iv) no winning outcome is based on the score, point spread, or any performance of any single actual team or combination of teams or solely on any single performance of an individual athlete or player in any single actual event; and (v) no player competes against the fantasy contest operator. "Fantasy contest operator" or "operator" means a person or entity to which the Department issues a fantasy contest permit pursuant to § 58.1-4203 . "Fantasy contest permit" means a permit to operate fantasy contests issued pursuant to the provisions of this chapter. "Fantasy contest player" or "player" means a person who competes in a fantasy contest offered by a fantasy contest operator. "Fantasy contest player" does not include a fantasy contest operator. "Fantasy contest revenue" means the amount equal to the total of all entry fees that a fantasy contest operator collects from all fantasy contest players, less the total of all sums paid out to all fantasy contest players, multiplied by the location percentage. "Location percentage" means the percentage of the amount equal to the total of all entry fees, rounded to the nearest tenth of a percent, collected by a fantasy contest operator from fantasy contest players located in the Commonwealth, divided by the amount equal to the total of all entry fees collected by a fantasy contest operator from all fantasy contest players in fantasy contests. "Principal stockholder" means any person who individually or in concert with his spouse and immediate family members beneficially owns or controls, directly or indirectly, 15 percent or more of the equity ownership of a fantasy contest operator or who in concert with his spouse and immediate family members has the power to vote or cause the vote of 15 percent or more of the equity ownership of any such operator. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4201 Powers and duties of the Board

A. The Board shall have all powers and duties necessary to carry out the provisions of this chapter. The Board may establish procedures deemed necessary to carry out the provisions of this chapter. B. Whenever it appears to the Board that any person has violated any provision of this chapter, it may apply to the appropriate circuit court for an injunction against such person. The order granting or refusing such injunction shall be subject to appeal as in other cases in equity. C. Whenever the Board has reasonable cause to believe that a violation of this chapter may have occurred, the Board, upon its own motion or upon complaint of any person, may investigate any fantasy contest operator to determine whether such operator has violated the provisions of this chapter. In the conduct of such investigation, the Board may: 1. Require or permit any person to file a statement in writing, under oath or otherwise as the Board determines, as to all facts and circumstances concerning the matter to be investigated; and 2. Administer oaths or affirmations and, upon its own motion or upon request of any party, subpoena witnesses and compel their attendance, take evidence, and require the production of any matter that is relevant to the investigation, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangibles and the identity and location of persons having knowledge of relevant facts or any other matter reasonably calculated to lead to the discovery of material evidence. D. Any proceedings or hearings by the Board under this chapter, where witnesses are subpoenaed and their attendance is required for evidence to be taken or any matter is to be produced to ascertain material evidence, shall take place within the City of Richmond. E. Upon failure to obey a subpoena and upon reasonable notice to all persons affected thereby, the Board may apply to the Circuit Court of the City of Richmond for an order imposing punishment for contempt of the subpoena or compelling compliance. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4202 Application for a fantasy contest permit; penalty

A. No fantasy contest operator shall offer any fantasy contest in the Commonwealth without first receiving a permit issued by the Department. Applications for a permit shall be on forms prescribed by the Board. Any permit issued by the Department shall be valid for three years from the date of issuance. B. The application for a permit submitted by a fantasy contest operator shall contain the following information: 1. The name and principal address of the applicant; if a corporation, the state of its incorporation, the full name and address of each officer and director thereof, and, if a foreign corporation, whether it is qualified to do business in the Commonwealth; if a partnership or joint venture, the name and address of each officer thereof; 2. The address of any offices of the applicant in the Commonwealth and its designated agent for process within the Commonwealth. If no such agent is designated, the applicant shall be deemed to have designated the Director of the Department. If the operator does not maintain an office, the name and address of the person having custody of its financial records; 3. The place where and the date when the applicant was legally established and the form of its organization; 4. The names and addresses of the officers, directors, trustees, and principal salaried executive staff officer; 5. The name and address of each principal stockholder or member of such corporation; 6. The applicant's experience in operating fantasy contests in any other state or country, including the operator's history and reputation of integrity, financial viability, and compliance with applicable laws and regulations; 7. The applicant's proposed internal controls, including controls to ensure that no prohibited or voluntarily excluded person will be able to compete in fantasy contests; 8. The applicant's history of working to prevent problem gambling, including instituting applicable training programs for its employees; and 9. Such information as the Department and the Board deems necessary to ensure compliance with the provisions of this chapter. C. Every permit issued pursuant to this chapter shall be accompanied by a nonrefundable, initial application fee of $50,000, which shall be deposited by the Department into the Problem Gambling Treatment and Support Fund established pursuant to § 37.2-314.2 . D. As a condition of being issued a permit, a fantasy contest operator shall submit evidence satisfactory to the Department that the operator has established and will implement procedures for fantasy contests that: 1. Prevent him or his employees and relatives living in the same household as the operator from competing in any fantasy contest offered by such operator in which the operator offers a cash prize; 2. Prevent the sharing of confidential information that could affect fantasy contest play with third parties until such information is made publicly available; 3. Verify that any fantasy contest player is 21 years of age or older; 4. Ensure that players who are the subject of a fantasy contest are restricted from entering a fantasy contest that is determined, in whole or part, on the accumulated statistical results of a team of individuals in which such players are fantasy contest players; 5. Allow individuals to restrict themselves from entering a fantasy contest upon request and take reasonable steps to prevent those individuals from entering the operator's fantasy contests; 6. Disclose the number of entries a single fantasy contest player may submit to each fantasy contest and take reasonable steps to prevent such players from submitting more than the allowable number; and 7. Segregate player funds from operational funds in separate accounts and maintain a reserve in the form of cash, cash equivalents, irrevocable letter of credit, bond, or a combination thereof in an amount sufficient to pay all prizes and awards offered to winning players. E. If permit application forms are filed online using a website approved by the Director of the Department, the operator shall follow the procedures on such website for signing the application forms. F. Any operator that allows its permit to lapse, without requesting an extension of time to file, shall be required to resubmit an initial permit application. An extension may be granted by the Department upon receipt of a written request. G. Any person who knowingly and willfully falsifies, conceals, or misrepresents a material fact or knowingly and willfully makes a false, fictitious, or fraudulent statement or representation in any permit application submitted pursuant to this chapter is guilty of a Class 1 misdemeanor. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4203 Issuance of permit; denial of same

A. The Department shall consider all applications for a permit and shall issue a valid permit to an applicant that meets the criteria set forth in this chapter. B. The Department shall deny a permit to any applicant unless it finds that: 1. If the corporation is a stock corporation, such stock is fully paid and nonassessable and has been subscribed and paid for only in cash or property to the exclusion of past services and, if the corporation is a nonstock corporation, that there are at least five members; 2. All principal stockholders or members have submitted to the jurisdiction of the courts of the Commonwealth for the purposes of this chapter, and all nonresident principal stockholders or members have designated the Director of the Department as their agent for receipt of process; 3. The applicant's articles of incorporation provide that the corporation may, on vote of a majority of the stockholders or members, purchase at fair market value the entire membership interest of any stockholder or require the resignation of any member who is or becomes unqualified for such position under subsection C; and 4. The applicant meets the criteria established by the Department for the granting of a permit. C. The Department may deny a permit to an applicant if it finds that the applicant, or any officer, partner, principal stockholder, or director of the applicant: 1. Has knowingly made a false statement of material fact or has deliberately failed to disclose any information requested; 2. Is or has been found guilty of any illegal, corrupt, or fraudulent act, practice, or conduct in connection with any fantasy contest in the Commonwealth or any other state or has been convicted of a felony, a crime of moral turpitude, or any criminal offense involving dishonesty or breach of trust within the 10 years prior to the date of application for a permit; 3. Has at any time knowingly failed to comply with the provisions of this chapter or of any requirements of the Board; 4. Has had a registration or permit to hold or conduct fantasy contests denied for just cause, suspended, or revoked in any other state or country; 5. Has legally defaulted in the payment of any obligation or debt due to the Commonwealth; or 6. Is not qualified to do business in the Commonwealth or is not subject to the jurisdiction of the courts of the Commonwealth. D. Any operator applying for a permit or renewal of a permit may operate during the application period unless the Department has reasonable cause to believe that such operator is or may be in violation of the provisions of this chapter and the Department requires such operator to suspend the operation of any fantasy contest until a permit or renewal of a permit is issued. E. The Department shall issue such permit within 60 days of receipt of the application for a permit. If a permit is not issued, the Department shall provide the operator with a specific justification for not issuing such permit. F. At least 60 days before the expiration of a permit, an operator shall submit a renewal application, on forms prescribed by the Department, accompanied by a nonrefundable fee of $25,000. The Department shall make a determination on an application for a renewal of a fantasy contest permit within 30 days of receipt. Any fees collected pursuant to this subsection shall be payable to the State Treasurer. All such fees received by the State Treasurer shall be remitted to the Department for the administration of this chapter. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4204 Independent audit required; submission to Department

An operator that has been issued a permit shall annually (i) contract with a certified public accountant to conduct an independent audit, consistent with the standards accepted by the Board of Accountancy; (ii) contract with a testing laboratory recognized by the Department to verify compliance with the provisions of subsection D of § 58.1-4202 ; and (iii) submit to the Department a copy of such reports required by clauses (i) and (ii). 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4205 Suspension or revocation of a permit

A. If the Department determines that a fantasy contest operator has violated any of the provisions of this chapter, the Department may, with at least 15 days' notice and a hearing, (i) suspend or revoke the operator's permit or (ii) impose on such operator a monetary penalty of not more than $1,000 per day for each violation of this chapter, not to exceed $50,000, in any case where a violation of this chapter has been shown by a preponderance of the evidence. The Department may revoke a permit if it finds that facts not known by it at the time it considered the permit application indicate that such permit should not have been issued. B. The Department may summarily suspend any permit for a period of not more than seven days pending a hearing and final determination by the Department if the Department determines that a violation of this chapter has occurred and emergency action is required to protect the public health, safety, and welfare. The Department shall (i) schedule a hearing within seven business days after the permit is summarily suspended and (ii) notify the operator not less than five business days before the hearing of the date, time, and place of the hearing. C. If any such permit is suspended or revoked, the Department shall state its reasons for doing so, which shall be entered of record. Such action shall be final unless appealed in accordance with § 58.1-4206 . Suspension or revocation of a permit issued by the Department for any violation shall not preclude civil liability for such violation. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4206 Hearing and appeal

Any person aggrieved by a denial of the Department to issue a permit, the suspension or revocation of a permit, the imposition of a fine, or any other action of the Department may seek review of such action in accordance with Article 5 (§ 2.2-4025 et seq.) of the Administrative Process Act in the Circuit Court of the City of Richmond. Further appeals shall also be in accordance with Article 5 (§ 2.2-4025 et seq.) of the Administrative Process Act. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4207 Fees and charges

Except as provided in subsection C of § 58.1-4202 and § 58.1-4212 , all fees, charges, and monetary penalties collected by the Department as provided in this chapter shall be paid into a special fund of the state treasury. Such funds shall be used to finance the administration and operation of this chapter. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4208 Taxation on fantasy contest revenue; allocation of tax revenue; additional fee

A. There shall be imposed a tax of 10 percent on an operator's fantasy contest revenue. B. The tax imposed pursuant to this section is due monthly to the Department, and the fantasy contest operator shall remit it on or before the twentieth day of the next succeeding calendar month. If the operator's accounting necessitates corrections to a previously remitted tax, the operator shall document such corrections when it remits the following month's taxes. C. The Department shall allocate the tax revenue as follows: 1. Two and one-half percent to the Problem Gambling Treatment and Support Fund established pursuant to § 37.2-314.2 ; and 2. Ninety-seven and one-half percent to the general fund. D. There shall be imposed an additional fee of 2.6 percent on an operator's fantasy contest revenue. Such fee is due monthly to the Department, and the fantasy contest operator shall remit it on or before the twentieth day of the next succeeding calendar month. The revenue from the fee imposed pursuant to this subsection shall be utilized by the Department to cover the costs of the administration and regulation of this chapter. Any revenue remaining after the Department has covered such costs shall be remitted to the general fund. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4209 Public inspection of information filed with the Department; charges for production

A. Except as provided in subsection B, permits issued pursuant to this chapter shall be open to the public for inspection at such time and under such conditions as the Board may prescribe. A charge not exceeding $1 per page may be made for any copy of such documents as may be furnished to any person by the Department. B. Reports, data, or documents submitted to the Department pursuant to the audit requirements of § 58.1-4204 and records submitted to the Department as part of an application for a permit or renewal of a permit that contain information about the character or financial responsibility of the operator or its principal stockholders shall be deemed confidential and shall be exempt from disclosure under the Virginia Freedom of Information Act (§ 2.2-3700 et seq.). 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4210 Permit not endorsement

No fantasy contest operator shall use or exploit the fact of being issued a permit pursuant to this chapter so as to lead the public to believe that such permit in any manner constitutes an endorsement or approval by the Commonwealth. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4211 Acquisition of interest in fantasy contest operator

A. If any person acquires actual control of a fantasy contest operator that has been issued a permit pursuant to the provisions of this chapter, such person shall submit an application for a permit with the Department in accordance with § 58.1-4202 . B. Where any such acquisition of control is without prior approval of the Department, the Department may suspend any permit it has issued to such operator, order compliance with this section, or take such other action as may be appropriate within the authority of the Department. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4212 Civil penalty

In addition to the provisions of § 58.1-4205 , any person, firm, corporation, association, agent, or employee who knowingly violates any procedure implemented under subsection D of § 58.1-4202 or any other provision of this chapter shall be liable for a civil penalty of not more than $1,000 for each such violation. Such amount shall be recovered in a civil action brought by the Department and be paid into the Literary Fund. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4213 Fantasy contests conducted under this chapter not illegal gambling

A. Nothing contained in Article 1 (§ 18.2-325 et seq.) of Chapter 8 of Title 18.2 shall be applicable to a fantasy contest conducted in accordance with this chapter. The award of any prize money for any fantasy contest shall not be deemed to be part of any gaming contract within the purview of § 11-14 . B. This section shall not apply to any sports betting or related activity that is lawful under Article 2 (§ 58.1-4030 et seq.) of Chapter 40, which shall be regulated pursuant to such chapter. 2026, cc. 565 , 566 .

Va. Code Ann. § 58.1-4214 Liability imposed by other laws not decreased

Except as provided in § 58.1-4213 , nothing contained in this chapter shall be construed as making lawful any act or omission that is now unlawful, or as decreasing the liability, civil or criminal, of any person, imposed by existing laws. 2026, cc. 565 , 566 .

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://law.lis.virginia.gov/vacode/title58.1/chapter42/Fetched: 10/16/2026