(a) It shall be a violation of § 39-17-503 for any person to offer fantasy sports contests through an online digital platform that enables Tennessee consumers to participate in such contests without that person being licensed as a fantasy sports operator by the secretary of state.

(b) Any person seeking to be a licensed fantasy sports operator shall submit an application, along with the required fee, to the secretary of state. The applicant shall provide sufficient documentation to the secretary of state to assure that such applicant meets the requirements for licensure, including, but not limited to:

(1) The name of the applicant;

(2) The location of the applicant's principal place of business;

(3) A complete disclosure of the true ownership of the applicant, as determined by the secretary of state;

(4) The applicant's criminal record, if any, or if the applicant is a business entity, the criminal records, if any, of any person owning a significant ownership interest in the applicant, as determined through rule by the secretary of state;

(5) Any ownership interest held by a director, officer, policy-making manager, or principal stockholder in any entity previously or currently licensed by another entity that licenses fantasy sports operators or similar entities;

(6) A description of any physical facility operated by the fantasy sports operator in this state, the facility's employees, and the nature of the facility's business;

(7) Information sufficient to show, as determined by the secretary of state, that the applicant:

(A) Limits individual player deposits to no more than two thousand five hundred dollars ($2,500) per month, unless the player provides reasonable certification or proof, including the types of certifications used to qualify accredited investors as defined in § 48-1-102, to the fantasy sports operator that the player's deposit limit should be increased;

(B) Protects player funds on deposit by, at a minimum:

(i) Segregating player funds from operating funds; and

(ii)

(a) Maintaining a reserve for the benefit and protection of authorized players' funds in fantasy sports accounts;

(b) The amount and form of the reserve shall be set forth in rules promulgated by the secretary of state; and

(C) Limits each player to one (1) active and continuously used account by:

(i) Verifying each player's true identity and location using commercially reasonable means;

(ii) Closing each account previously held by a player when a new account is opened by that same player while carrying over any designations applicable to that account;

(iii) Using technologically reasonable measures to prevent the use of proxy servers; and

(iv) Using technologically reasonable measures to detect and prevent the use of a player's account by other players;

(8) Information sufficient to show that the applicant is in good standing with the department of revenue; and

(9) Any other information the secretary of state deems necessary.

(c) In order to maintain a fantasy sports operator license, the licensee shall maintain records of all player accounts, retain such records for five (5) years from the date the account was created, and submit annual reports of all fantasy sports accounts opened or maintained by Tennessee consumers to the secretary of state, including the following information:

(1) All account transactions;

(2) All winnings by Tennessee consumers;

(3) The amount in accounts opened or maintained by Tennessee consumers; and

(4) All fantasy sports operator revenue derived from Tennessee consumer accounts and transactions.