Is it legal to play fantasy sports like Dream11 for real money in India?

by Amit K. Marketing Manager

Fantasy games based on popular sports such as cricket, soccer, and kabaddi have grown by 100 percent in India since 2018. The online gaming industry grew 40% in 2019 to INR 65 billion and is expected to grow 43% by 2022 to INR 187 billion at a CAGR of 43%.

The recent growth of fantasy sports in India is attributed to the increased penetration of low-cost smartphones combined with affordable internet costs. However, the lack of specific legislation or regulation proved to be a stumbling block in the growth storey of fantasy sports.

On the theory of functional equivalence, gaming is currently regulated by decades-old gaming legislations that were primarily enacted to regulate gaming in physical environments. The social stigma associated with poker and other card games has also proven to be a challenge for fantasy gaming portals.

Dream 11, My 11 Circle, My Team 11, Howzat Fantasy, FanCode, 11wickets, and other fantasy gaming entities have received millions of dollars in funding. In fact, Dream 11 has sponsored the upcoming 2020 edition of the cash-rich Indian Premier League.

Online Gaming Laws and Fantasy Sports in India

Gaming for stakes is mentioned several times in Mahabharat, the ancient Indian epic, and has a prominent role in Indian literary texts. Gaming for stakes is either prohibited or heavily regulated in modern India. Gambling and betting are classified as Schedule VII (State List) activities under the Indian Constitution, and states have the authority to enact laws to regulate them in their respective territories.

Following that, the majority of Indian states adopted the Public Gambling Act, 1867 (“PG Act”), pre-independence legislation, and the remaining states enacted their own legislation (collectively referred to as “Gaming Legislations”).

Gaming, or gambling in some cases, is defined in the majority of Gaming Legislations as any act of wagering or betting other than wagering on a horse race/dog race or games of simple skill. With the exception of Andhra Pradesh, Telangana, Odisha, and Assam, most states' gaming legislation differentiates between skill games and chance games.

The Indian Supreme Court has interpreted the term "games of mere skill" used in the Gaming Legislations to mean competitions in which success is dependent on a substantial degree of skill despite the presence of an element of chance. Even if a game is predominantly a game of skill, it is still a game of "mere skill."

We should also mention that the Supreme Court of India has ruled that competitions requiring significant skill are business activities protected by Article 19(1)(g) of the Constitution (the right to practise any profession or to carry on any occupation, trade or business). Various High Courts have relied on the Supreme Court's decision in deciding questions about the legality of skill-based games over time.

Fantasy Sports for real money – Game of Mere Skill?

As previously stated, the Gaming Legislations are decades old and were not enacted in light of the advent of the internet and subsequent technological advancements. Fantasy sports, which have been around since the 1950s, have gained popularity in the digital age.

Fantasy Sports are games that take place over a predetermined number of rounds in which participating users select, build, and act as managers of their virtual teams (made up of real players or teams) that compete against virtual teams of other users, with results tabulated based on statistics, scores, achievements, and results generated by real individual athletes or teams in certain disciplines.

The winner of a fantasy sports game is the participant whose virtual team accumulates the most points over the course of the game's round(s). Users must pay an entry fee, and all money collected is pooled and distributed to the top users in a predetermined ratio.

Rajasthan High Court on Fantasy Sports

While dismissing an appeal against the Rajasthan High Court judgement a few weeks ago, the Supreme Court stated that the issue of whether fantasy sports are a game of skill or gambling is no longer res Integra (a question yet to be determined) and that it had dismissed similar petitions against the Bombay and Punjab & Haryana High Court judgments from 2017 onwards.

Recently, the Rajasthan High Court (Jaipur Bench) dismissed yet another PIL filed by Udaipur resident Saahil Nalwaya asking the state government to draught legislation prohibiting or regulating online gaming, including fantasy sports. Dream11 is not a party to the new PIL filed in the Rajasthan High Court. A similar PIL was previously dismissed by the Rajasthan High Court in Ravindra Singh Chaudhary v. Union of India & Ors., with an order dated October 16, 2020.

Is Fantasy Sports legal in India? Rajasthan High Court on FIFS Charter

In December 2020, the Government of India's policy think tank, NITI Aayog, released Draft Guiding Principles for the Uniform National-Level Regulation of Online Fantasy Sports Platforms in India. Niti Aayog advised fantasy platform operators in the draught to keep statistical data to track player/user performance on their platforms and submit it to the self-regulatory organisation (FIFS) on a regular basis to demonstrate that the formats deployed by the operator are skill dominant.


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About Amit K. Professional   Marketing Manager

867 connections, 38 recommendations, 2,114 honor points.
Joined APSense since, February 5th, 2021, From Kolkata, India.

Created on Oct 7th 2021 07:33. Viewed 151 times.


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