The Massachusetts Gaming Commission (MGC) decided 5-0 to remove some of the restrictions affecting affiliate agreements, which means that sports betting operators in the Bay State can finally get some much-needed rest. 

After giving the matter a lot of thought, the regulatory body decided that CPA and revenue-sharing models should be allowed in its area of responsibility so that they can be looked at closely enough.

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In February, the MGC made its plan to address revenue-sharing agreements public for the first time. The laws that are now in effect in the state of Massachusetts forbid any and all businesses that deal in sports wagering from paying out money to third parties on the basis of the number of customers they serve, the amount of money they wager, or the results of individual bets.

Because of these rules, it is not possible to use the usual affiliate arrangements, which are used by many operators for marketing and promotion.

After a thorough review, the Commission decided that it would be in its best interest to talk with operators and those who would be affected by the decision. The regulatory body disclosed that the date of its final vote would be March 23.

Still, this date is more than two weeks after the official start of online sportsbooks in the state. This would be a big problem for operators who rely on affiliates for a big part of the process of signing up new customers.

The most recent information is that the MGC has agreed to temporarily lift limits on revenue-sharing and CPA until April 14th.

After everyone voted the same way, it was decided that the stopgap solution would allow online sports betting to start without any problems and give enough time to make safer gaming standards.

In spite of the fact that the regulatory body is eager to address the problem, it is highly doubtful that they will make the exemption permanent without first enacting extra safe gaming and compliance standards.

Even though some of the commissioners were worried about the compromise, the vast majority of them agreed that the MGC should take the lead and put in place a structure that puts a strong focus on protecting the players.

Application for Vendor License

The Commission has already implemented efforts to rein in affiliates, including a newly enacted regulation that places affiliates in the same category as vendors and mandates that they register with the agency.

To avoid oversaturation of the market, the MGC is mulling over the possibility of making it a requirement for them to submit an application for a vendor license, as well as the possibility of adopting additional regulations.

Affiliate marketing for operators is, and will continue to be, a touchy subject. Cathy Judd-Stein, chairperson of the MGC, pointed out that revenue sharing fundamentally goes against the organization’s goals to promote responsible gaming.

Still, it looks like the Commission thinks the practice is a necessary evil, and it is doing everything it can to make sure it is done in a safe and reasonable way. Online sports betting is set to start in Massachusetts on March 10, and the state regulator will likely face many more problems like these. 

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