H.R. 7840: Event Contract Enforcement Act

The Event Contract Enforcement Act is a proposed bill aimed at modifying the existing Commodity Exchange Act to impose restrictions on certain types of event contracts. These restrictions would specifically prohibit contracts that are based on events deemed harmful to the public interest. Here’s a breakdown of what the bill entails:

Prohibition of Certain Event Contracts

The bill seeks to establish that it is illegal to offer for trading any contracts, agreements, or transactions that are linked to certain events or situations. Specifically, it covers:

• Illegal activity: Any event that violates federal or state law.
• Terrorism: Any event related to terrorist activities.
• Assassination: Events concerning the murder of significant individuals.
• War: Events associated with military conflicts.
• Gaming: Any event related to games of chance or challenges, including those that can be live, simulated, or virtual.
• Election outcomes: Results from federal, state, or local elections, including ballot initiatives and referenda.
• Government conduct: Actions performed by any level of government, including local or federal government activities.
• Other public interest issues: Any other events identified by the Commodity Futures Trading Commission (CFTC) as harmful to public interest.

Exemption for States

The bill allows individual states the option to exempt themselves from the prohibition on gaming contracts. This means that if a state decides to legalize events concerning gaming under its own laws, those contracts would not fall under the restrictions set by this bill.

Definition of Gaming

Under this bill, gaming is defined as any aspect of a live, simulated, or virtual physical or mental challenge or game of chance. This broad definition is intended to encompass a variety of activities that may be considered gaming under different circumstances.

Effective Date

The changes proposed in this bill would take effect 180 days after its enactment, giving stakeholders time to adjust to the new regulations and definitions set forth by the law.

Relevant Companies

• GLPI: Gaming and Leisure Properties, Inc. may be impacted due to its involvement in gaming and the potential restrictions this bill places on gaming-related contracts.
• WSR: Whitestone REIT, as it includes properties that may engage in activities that could be categorized under the gaming exemption.