Too Late to Get Licensed for the 2024 NFL Season?

By: Sara Dalsheim

Each NFL season, as more states join the legalized sports betting market, there are record-breaking numbers in wagering related revenue. Along with the rise in the number of states and revenues, there are more vendors and suppliers eager to work with and offer their products/services to the sports wagering operators. However, what these vendors may not realize are the regulatory barriers at play in such a highly regulated market. Particularly, the registration or licensing requirements in each state for which they will be servicing operators.

Regulators have a large amount of discretion in determining who needs to be licensed. The type of services and/or the amount/basis of compensation will impact whether and what type of license is required. It is essential that an entity providing goods/services to a wagering operator consult with legal counsel to determine whether they fall into a licensing category prior to beginning the work.

There is not a universal licensing process in the wagering industry; being licensed in one jurisdiction is unlikely to impact your ability to or the speed at which another state’s licensing can be obtained. States vary not only regarding which vendors they require to be licensed but also the speed of their licensing process.

Several factors can impact how long it may take to obtain a license. First, the entity must have in place all prerequisites for licensing. Examples of these prerequisites include having a letter of intent or agreement with an operator and obtaining foreign business qualifications where required. Second, the entity must ensure that everyone in the company is on board with being licensed – specifically, the owners and executives. Depending on the level of licensing, states may require owners and executives to submit personal information or detailed personal disclosures. The relevant individuals may also be required to produce personal financial documents and fingerprints. Additionally, to finalize a license application, several states require forms to be notarized, and this may include each owner and executive submitting notarized forms.

Another factor that is often forgotten by vendors is that each state’s process for reviewing, investigating, and approving a license is different. In some states, this may take several weeks while in others it could take several months. It is also important to remember that the regulatory bodies are run by individuals, not machines. It takes time for them to review applications. They may have follow-up questions or requests. Additionally, depending on when it is submitted, your application may be one of a few or one of hundreds that a regulator is reviewing. Some states may allow a temporary license or conditional approval while the investigation is taking place, but temporary licensing is uncommon and typically only available under extenuating circumstances. States may also approve licenses on a rolling basis, or they may require approval by the state’s regulatory board that only meets periodically at set meetings. Therefore, an entity will not only need to wait for the applications to be reviewed and the investigations to take place but then, depending on when the investigation is complete and approved, need to wait weeks more for the next regulatory board meeting.

The most common question an applicant asks before moving forward with licensing is how long it will take, and, as shown by the above factors – it depends. As with any highly regulated market, the licensing process is not quick, even for the lowest level license or registration. So, if you are looking to service a wagering operator this NFL season it is unlikely your entity can get licensed in time for the first month or two of the NFL season. However, it is realistic to be licensed in some states before the end of the season and largest day in sports wagering, the Super Bowl!