Bipartisan lawmakers in Pennsylvania have introduced House Bill 2711, which would prohibit sports betting operators and other gambling companies from acting as liquidity providers or market makers on prediction platforms.
The bill was introduced on July 22 by state Representative Tarik Khan and has been referred to the House Consumer Protection, Technology and Utilities Committee.
Bill targets commercial ties between prediction platforms and gambling businesses
HB 2711 would also bar prediction platforms from signing contracts with, or sharing revenue with, companies that are normally engaged in gambling businesses. The restriction would apply not only to those companies directly, but also to parent companies, subsidiaries, affiliates, joint ventures, employees, and entities acting for another company’s financial interest.
DraftKings and Flutter have previously moved into market-making operations. DraftKings recently launched the DKeX exchange after acquiring Railbird Technologies, a company registered with the Commodity Futures Trading Commission, or CFTC.
Age floor and market restrictions
The proposal would set a minimum participation age of 21. It would also require platforms to exclude self-excluded users, company employees, settlement-source employees, and anyone holding insider information.
The bill would require platforms to adopt commercially reasonable measures to prevent fraud, manipulation, and the misuse of material nonpublic information. It would also prohibit markets tied to high school sports, sporting events involving minors, personal health conditions, and death-related events.
No licensing framework in HB 2711; companion bill takes a different route
HB 2711 does not establish a licensing regime. Enforcement authority would be assigned to the state attorney general.
Pennsylvania also has a companion proposal, HB 2497, which would require platforms to obtain a license from the Pennsylvania Gaming Control Board and would impose a combined 22% tax on prediction betting platform revenue.
Neither bill has received a committee vote or hearing so far.