Regulatory
PASPA (Professional and Amateur Sports Protection Act)
PASPA
Definition
PASPA, the Professional and Amateur Sports Protection Act of 1992, was a US federal law that made it unlawful for states to sponsor, operate, advertise, promote, license or authorise betting schemes based on competitive sporting events, and for private persons to run such schemes under state law. Enacted on 28 October 1992 and effective from 1 January 1993, it grandfathered schemes already in operation, which left Nevada as the only state with full single-game sports betting.
On 14 May 2018 the Supreme Court held in Murphy v. National Collegiate Athletic Association that PASPA's ban on states authorising sports betting unconstitutionally commanded state legislatures, breaching the anticommandeering principle. Because the remaining provisions could not be severed from that core, the Court struck down the whole Act. Each state has since decided for itself whether and how to legalise sports betting.
Key takeaways
- PASPA was a 1992 federal law that stopped states from authorising or licensing sports betting, with exceptions for schemes already running, chiefly Nevada.
- The Supreme Court struck down the entire Act in Murphy v. NCAA on 14 May 2018, by a 6 to 3 majority.
- The Court held that Congress cannot order state legislatures not to legalise an activity, under the anticommandeering doctrine.
- Murphy did not legalise sports betting nationally; it returned the decision to each state.
Why it matters
PASPA's fall created the US sports betting market as it exists today. Before 2018, regulated single-game sports betting was confined to Nevada; afterwards states legislated one by one, each with its own licence types, tax rates and rules on mobile betting, college sports and in-play markets. That patchwork is the reason operators and suppliers must hold separate approvals, integrate separate geolocation and reporting, and price for different taxes in every state, as the regulatory map shows.
Murphy also changed the legal arguments around gambling. Its anticommandeering reasoning limits how far Congress can direct states, which features in debates about federal preemption, including the current fight over whether CFTC-regulated event contracts override state gambling law. Tribal operators, whose rights are set by tribal-state compacts, negotiated sports betting into compacts once states could authorise it.
Federal law did not disappear with PASPA. The Wire Act still bars interstate transmission of sports bets, so post-PASPA sports betting is built state by state. The US online gambling regulation course explains how the federal statutes fit together.
PASPA (Professional and Amateur Sports Protection Act) vs Wire Act
| PASPA (Professional and Amateur Sports Protection Act) | Wire Act |
|---|---|
| Barred states from authorising sports betting at all, with grandfathered exceptions. It was struck down in full in 2018. | Bars businesses from transmitting bets across state or national lines by wire. It remains in force and is read as applying to sports betting. |
Murphy let states legalise sports betting, but the Wire Act keeps each state's market separate. That is why US sports betting is licensed and geolocated state by state.
The bottom line
PASPA was the 1992 federal ban on state-authorised sports betting, struck down in full by the Supreme Court in Murphy v. NCAA in 2018. Its repeal handed sports betting policy to the states and created today's state-by-state US market.
Sources
- 28 U.S. Code 3702: Unlawful sports gambling - Legal Information Institute, Cornell Law School
- Murphy v. National Collegiate Athletic Association, 584 U.S. (2018) - Legal Information Institute, Cornell Law School
- 28 U.S. Code 3704: Applicability - Legal Information Institute, Cornell Law School
Frequently asked questions
What is PASPA?
PASPA is the Professional and Amateur Sports Protection Act, a federal law passed in 1992. It prohibited states from sponsoring, operating, licensing or authorising sports betting, and prohibited private persons from running sports betting under state law. It exempted schemes already operating, which left Nevada as the main legal sports betting market. The Supreme Court struck it down in 2018.
What was Murphy v. NCAA?
Murphy v. National Collegiate Athletic Association is the Supreme Court case decided on 14 May 2018 that struck down PASPA. It arose from New Jersey's attempts to allow sports betting at casinos and racetracks, which the major sports leagues and the NCAA challenged. Justice Alito wrote for the majority, holding that PASPA unconstitutionally dictated what state legislatures could and could not do.
Why was PASPA struck down?
The Supreme Court held that PASPA's ban on states authorising sports betting violated the anticommandeering doctrine, which stops Congress from issuing direct orders to state legislatures. Congress can regulate sports betting directly, but it cannot command states to keep their own prohibitions in place. Because the other provisions depended on that unconstitutional core, the Court held that none of the Act could survive.
Did the end of PASPA legalise sports betting nationwide?
No. Murphy removed a federal barrier but did not legalise anything. Each state still needed to pass its own law to permit sports betting, and some states have chosen not to. Federal laws such as the Wire Act continue to apply, so legal sports betting operates within individual states, with operators licensed and geolocating customers state by state.