Despite New Jersey Governor Chris Christie vetoing an online gambling bill earlier this year, the governor of Nevada has now signed legislation (Nevada 2013-AB114) that enables and authorises that state to make arrangements and enter into agreements with other states that legalise interstate online poker conducted across those state lines. The US Department of Justice still holds that sports betting is illegal under the Interstate Wire Act of 1961 and there has been no move to repeal or amend the Unlawful Internet Gambling Enforcement Act of 2006 or, for example, the corresponding compliance obligations applicable to financial institutions imposed by the Federal Deposit Insurance Corporation. However, at the end of 2011, the Department of Justice released a memorandum indicating that it no longer believes that non-sports related online betting and wagering (eg, online poker) is prohibited by the Wire Act, essentially paving the way for states to act in the arena of intra-state online gambling – including sports wagering solely within states.

Technically, the Nevada statute eliminates a provision in the existing law that would require either approval from the Department of Justice or some Federal-enabling legislation. Effectively it allows the Nevada Gaming Commission to adopt regulations that authorise the state (ostensibly through the governor's office) to enter into agreements with other states. Obviously, each other state would require similar enabling legislation and New Jersey is poised to send another bill to its governor's office in the hope that it can craft legislation that Christie is willing to sign.

Nevada has traditionally had a strong regulatory environment and the bill includes the following language expressing the intent and basis for the new legislation. The bill notes that "The state of Nevada leads the nation in gaming regulation and enforcement" and "is uniquely positioned to develop an effective and comprehensive regulatory structure related to interactive gaming".

For further information on this topic please contact Joseph I Rosenbaum at Reed Smith LLP by telephone (+1 212 521 5400), fax (+1 212 521 5450) or email (jrosenbaum@reedsmith.com).

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