- The Law & Technology Society, NLSIU Bengaluru, released a comprehensive study asserting the legality of fantasy sports formats offered by Indian platforms
- The study delves into judicial precedents, revealing how the Indian and US judiciary, through the “preponderance of skill” test and relying on statistical studies, consistently upheld fantasy sports as skill-based and legitimised the industry
New Delhi, September 11, 2024: The Law and Technology Society of National Law School of India University (NLSIU), Bengaluru, released a landmark paper titled “Skill Over Chance: A Comparative Study of Legal Recognition of Fantasy Sports in India & USA,” asserting the legality of the skill-based fantasy sports format offered by Indian platforms. This pivotal study conducts an extensive legal assessment of how the sector has been treated in two leading jurisdictions- India and the US and calls for regulatory certainty for the sector in India.
Home to over 300 fantasy sports platforms and ~22 crore users, the Indian fantasy sports industry is a significant contributor to the national economy. It has grown at a rate of 31% and is projected to reach a valuation of INR 25,240 crore by FY27. As per an industry report released by Deloitte in 2023, fantasy sports’ contribution to the public exchequer is also expected to reach INR 26,000 crore between FY23 and FY27. In FY22 alone, the sector attracted investments totalling INR 15,000 crore from foreign and domestic sources while creating 12,000 direct and indirect jobs. Notably, fantasy sports also generated INR 3,100 crore for real-world sports and sports development in FY22, a figure that is projected to reach INR 6,500 by FY27.
The study, authored by Divyansh Bhansali, Srinjoy Debnath, and Keshav Soni, comprehensively analyses and compares the legal frameworks governing fantasy sports in India and the United States of America. They delve deep into how Indian and American courts have consistently upheld fantasy sports as skill-based by applying the “preponderance of skill” test. In the Indian context, the authors emphasise that through 5 High court judgments and 7 Supreme Court orders, it has been firmly established and settled that fantasy sports is a game of skill distinguished from gambling, betting and wagering activities and is constitutionally protected under Article 19(1)(g) of the Indian Constitution.
In the United States, landmark judgements have also applied the “preponderance of skill” test, backed by various statistical studies to reinforce the view fantasy sports as skill-centric. This aligns with global trends, further validating Indian judiciary’s outlook towards FS . To support their conclusion, the authors also rely on statistical studies such as a recent report by IIM Bangalore Professors that provides incontrovertible evidence that the effect of the user’s skill significantly outweighs chance in determining the success in a fantasy sports contest.
Dr. Sasmit Patra, Member of Parliament, Rajya Sabha, praised the report’s findings in his foreword: “It contributes to the existing literature on fantasy sports and their legal classification and provides a broader perspective on the online gaming regulatory landscape. With fantasy sports’ legal status as games of skill firmly established, the need for a well-defined regulatory regime becomes paramount. Moreover, efforts should be directed at encouraging further quantitative studies to determine various online games that are offered today are skill or chance.”
Dr. Betsy Rajasingh, Assistant Professor of Law at NLSIU and Co-Director of the Centre for IP Research and Advocacy, also lent her voice to support the paper’s findings. She stated in her foreword: ‘This paper makes a compelling argument in favour of the legality of fantasy sports-a type of online gaming in India. This paper can hence be the answer for anyone interested in finding an overview of the legality of fantasy sports in India and arguments in favour of its recognition.’
Key recommendations from the study include:
- Operationalising the IT Rules: Implementing the amended IT Rules is crucial to balancing innovation, entrepreneurship, and user protection in online gaming.
- Leveraging Existing Jurisprudence: Drawing from Indian and international legal precedents will help shape a robust regulatory framework addressing national and global challenges.
- Incorporating Statistical Studies: Judicial and regulatory bodies should utilise statistical analyses to gain valuable insights that inform decision-making processes.
- Comprehensive Stakeholder Engagement: Engaging multiple stakeholders in consultations will ensure a uniform regulatory environment, benefiting all players in the ecosystem.
The report also urges policymakers to act on NITI Aayog’s recommendations for regulatory clarity and develop a national framework that promotes innovation while ensuring transparency and consumer protection. Such a framework, the report suggests, is crucial to unlocking the full potential of this sunrise sector, which offers immense opportunities for job creation and economic development.
Access the publication here
