N.J. Admin. Code § 13:74C-2.2

Current through Register Vol. 56, No. 21, November 4, 2024

Section 13:74C-2.2 - Exchange wagering license application renewal process

(a) The procedures in this section shall apply where the Authority has been granted an initial exchange wagering license, and seeks to renew that license, or where a successor in interest to the exchange wagering license makes proper application to the Commission for the transfer or assignment of said license, or for the renewal of said transferred or assigned license.

(b) The applicant may apply for a renewal license of either a one-year or two-year duration, on a form prescribed by the Commission, accompanied by a non-refundable filing fee of $ 2,500 for each year that the license is to be effective. In the event the applicant requests a renewal license to be effective for two years, the Commission may elect to grant a license for only one year, where it finds that any significant problems associated with or encountered by the exchange wagering system, which occurred between 12 months preceding the filing date of the applicant's renewal application and the date upon which the Commission considers such renewal application, require the imposition of a license condition for remedial action on the part of the applicant during the license renewal period. In such event, the applicant shall be reimbursed $ 2,500 of the $ 5,000 filing fee paid in connection with such application.

(c) The applicant shall file with the Commission a complete exchange wagering renewal application, on a form prescribed by the Commission, no earlier than 90 days prior to the date upon which it is issued and outstanding exchange wagering license is due to expire, and no later than 75 days prior to the date upon which it is issued and the outstanding exchange wagering license is due to expire. The renewed exchange wagering license shall expire on the 31st of December during the last year for which it is effective.

(d) An application for a renewal exchange wagering license shall not be considered complete unless:

1. The applicant demonstrates that the requirements of the Act have been satisfied;

2. The applicant has completely answered each question within the application and complied with the requirements of this section;

3. The applicant sets forth information about the operation of the exchange, the applicant's participation therein, the participation of other persons or entities in the operation of the exchange, the participation of each racetrack permitholder in the sharing of net exchange revenues, information to establish that wagers placed through the exchange wagering system will be accurately processed, and information to establish that there will be sufficient safeguards to maintain the integrity of the horse racing industry in this State;

4. The applicant sets forth information establishing that the Commission's grant of the exchange wagering license to the applicant will serve to promote the economic future of the horse racing industry in this State, foster the potential for increased commerce, employment, and recreational opportunities in this State, and preserve the State's open spaces;

5. The applicant discloses whether it shall conduct or operate the exchange itself, or whether, pursuant to and as authorized pursuant to N.J.A.C. 13:74C-3.2, it intends to enter into a written agreement with an exchange management agent and/or exchange services agent;

6. The applicant discloses the physical location of all hardware and software, and administrative offices of the exchange wagering system, and whether or not the exchange wagering platform shall be stand-alone or shall integrate with a totalisator system;

7. The applicant discloses the number of jobs that the exchange wagering system has generated or is expected to generate, as well as employ in terms of pre-existing jobs, and whether the related job functions are proposed to occur in this State or outside this State;

8. The applicant attaches a written internal control procedures of the applicant, which set forth the procedures to be implemented: to effectively operate and manage the exchange wagering system; to ensure that wagers placed through the exchange wagering system will be accurately processed and that all aspects of wagering integrity and wagering recordkeeping will be maintained; to effectively ensure that the exchange wagering system operates with fiscal soundness and technological reliability; and to effectively ensure that there will be sufficient safeguards to maintain the integrity of the horse racing industry in this State. Where the applicant with prior Commission approval has entered into, or intends to enter into, a written agreement with an exchange management agent and/or exchange services agent, the applicant may satisfy this requirement by including the sufficient internal control procedures of each such agent with its application. However, in such case, the applicant shall include with its application its own internal control procedures, which, at a minimum, include a certification that it has reviewed the internal control procedures of such exchange management agent, and/or exchange services agent, and finds them to be sufficient, and such internal control procedures of the applicant shall further include sufficient provisions to ensure that the applicant, as the exchange wagering licensee, maintains meaningful and adequate oversight controls with respect to both the exchange wagering system and its exchange wagering license;

9. The applicant attaches a written report to its application identifying in detail any significant problems associated with or encountered by the exchange wagering system during the 12-month period preceding the date of the filing of the application with the Commission; and

10. The application form shall be accompanied by a certification, signed by a high managerial agent of the applicant, attesting that the disclosures within the application and within its attachments are true, accurate, and complete.

(e) Following a determination that the application for the exchange wagering license is complete, the Commission Executive Director shall within 14 days review the application in accordance with the Act to ensure that the application is in due form and meets the requirements of law in all respects. Upon the Commission Executive Director being satisfied that these requirements are met, the Commission shall within 60 days thereof consider the application at a public meeting, and no later than 30 days from the closing of the record of the public meeting where the Commission considers the application, the Commission shall make a final determination on the application. The Commission's final determination may prescribe such conditions or terms as the Commission deems appropriate.

(f) The Commission may refuse to issue a license if it shall find that the applicant has failed to demonstrate its suitability for a license by clear and convincing evidence. The applicant shall bear the burden of establishing to the Commission, by clear and convincing evidence, that:

1. It and its employees are qualified in all aspects to hold the appropriate license;

2. The issuance of an exchange wagering license to the applicant will not be inimical to the best interests of the public and the horse racing industry in this State;

3. Wagers placed through the exchange wagering system will be accurately processed and that there will be sufficient safeguards to maintain the integrity of the horse racing industry in this State; and

4. All of the requirements of the Act and this chapter have been met, including the approval of the Attorney General.

(g) The Commission's determination on the license renewal application shall be submitted to the Attorney General for review and approval, within 14 days following the Commission's determination. The determination of the Commission shall be deemed approved by the Attorney General if not affirmatively approved or disapproved by the Attorney General within 14 days of the date of submission. The Commission shall issue the renewal license to the applicant, to establish the exchange, upon approval of the Attorney General. The Attorney General shall approve the Commission's determination where the Attorney General, in his or her discretion, finds that the Commission's determination was consistent with the Act and this chapter. The decision of the Attorney General shall be deemed a final decision, and the Attorney General may prescribe such conditions or terms, as he or she deems appropriate.

N.J. Admin. Code § 13:74C-2.2

Adopted by 47 N.J.R. 807(b), effective 4/20/2015.

Adopted by 56 N.J.R. 413(a), effective 3/18/2024