Monday, Jan 18, 2021 08:15 [IST]
Last Update: Monday, Jan 18, 2021 02:45 [IST]
At a time when much of our educational as well as recreational activities have gone virtual thanks to the extended lockdowns and the prevailing pandemic situation, the draft ‘Guiding Principles for the Uniform National-Level Regulation of Online Fantasy Sports Platforms in India’ proposed by NITI Aayog is timely and much needed for a comprehensive understanding of the regulation of online fantasy sports.
The legality of the Indian Fantasy Sports industry, most often, is misrepresented. Furthermore, we often end up confusing fantasy sports with online games. The recent draft guidelines recommends regulating Online Fantasy Sports (OFS) platforms in India through a single-purpose fantasy sports industry body (Self-Regulatory Organisation). The guidelines draw a clear distinction between online games and fantasy sports and underlines the impact of OFS on sports and overall economy in India.
Fantasy sports as a concept originated in academia as informal baseball fan leagues and have evolved into effective means for continuous fan engagement and growth of real-world sports. They serve essentially as a technology-enabled platform, offering sports enthusiasts a more engaging experience by elevating them from being mere viewers to active participants in the sport. Fuelled by improved internet connectivity and rapid proliferation of smartphones, fantasy sports today boasts of a massive user base of over 100 million.
Driven by increased mobile internet penetration and user engagement during the pandemic, the focus on this space has increased of late. Unfortunately, as in many cases where dissimilar things are lumped together, not all of this attention has been positive. Incidents motivated by short-term profit and unconcerned with legality or protection of users have been witnessed, highlighting the urgent need for intelligent regulation.
Recently, certain Indian states have banned ‘online gaming’. Since there’s no regulatory framework, fantasy sports are often treated as online games. As a result, this ban affects them too. However, the fact is that unlike gaming, fantasy sports are entirely dependent on the outcome of real-world sporting events. As different states have different laws governing OFS platforms in India, the report points out that this may result in “inconsistent experience” for users and might prevent sports fans from actively engaging in fantasy sports.
The Niti Aayog’s discussion paper, which proposes several important guardrails around advertising, gameplay formats, responsible gaming, independent evaluation, grievance redressal, and perhaps most importantly, regulatory certainty and consistency, is a welcome step in the evolution of this industry.
The emergence of fantasy sports and their increasing popularity have also made India a very attractive proposition for investors. The industry has already received ?1,000 crore in foreign investment and is expected to attract an additional ?10,000 crore in the next five years. Furthermore, the industry is projected to cumulatively contribute ?13,500 crore in taxes to the Indian government and create additional 12,000 jobs through direct and indirect employment in the next few years.
Niti Aayog’s guiding principles come at a timely juncture and propose progressive reforms that will accord fantasy sports a national and uniform safe harbor that is conducive to innovation and growth of the industry. Under a supportive and facilitating regulatory framework, fantasy sports have the potential to drive tremendous economic growth and enable India to emerge as a global hub for the industry.