Fantasy Sports In India - Online Fantasy Sports (OFS)

Fantasy Sports in India has been fast emerging in the last decade and amid pandemic owing to digitization, internet penetration, by leveraging 5G, artificial intelligence and virtual reality. So much so that it has been a major contributor to the growth of sports across the nation.

Fantasy Sports in India – Why in News?

Since Online Fantasy Sports has seen a major boom and has been attracting good foreign investment, Niti Aayog recommends a Self – Regulatory body for the fantasy sports industry.

The article will help candidates prepare for the general awareness and current affairs section of various Government exams.

Also, candidates preparing for IAS exam might encounter questions related to Online Fantasy sports under Prelims and General Studies Paper 2 of UPSC.

Candidates preparing for various competitive exams can go through the following links for their preparation-

What Is Fantasy Sport?

Fantasy Sports are online prediction games where you put together a virtual team of real sports players. You earn points based on real-life statistics that are converted into fantasy points. The better your player performs in real life, the higher your fantasy points.

  1. It is a type of game, often played using the Internet, where participants assemble imaginary or virtual teams composed of proxies of real players of a professional sport.
  2. These teams compete based on the statistical performance of those players in actual games. This performance is converted into points that are compiled and totalled according to a roster selected by each fantasy team’s manager.
  3. The fantasy sports are applicable to all the games such as Football, basketball, rugby, cycling, hockey, tennis, motorsports, golf, athletics, cricket, volleyball.

Few major players in Fantasy Sports in India

  1. Dream11
  2. MyTeam11
  3. Halaplay
  4. My11Circle
  5. 11Wickets
  6. Mobile Premier League

Check the links given below for exam preparation –

Difference Between Fantasy Sports & Other Online Games Or Sports Betting

  1. Fantasy sports are entirely different from all forms of online games that are in the nature of e-sports, casual gaming etc. that do not need a real-life player to be actually playing a real sports match to decide the outcome for the participant.
  2. Fantasy sports, unlike other online gaming, is dependent on actualities, seasonality and availability of real-time sports matches make it a non-addictive form of play which sets it distinctly apart from other forms of online game that are perceived to be in the nature of gambling and/or betting.

Online Fantasy Sports in India – Key Points

Economic Facts

Fantasy sports which began over 60 years ago as “fun” has today turned into a multi-billion dollar industry and is growing rapidly.

  1. The Online Fantasy Sports platforms and operators cumulatively paid GST of approximately INR 445 crore in the Financial Year 2020, substantially higher from INR 166 crore in Financial Year 2019, as per the FIFS report.
  2. Fantasy sports as an industry has attracted significant amounts of Foreign Direct Investment in India. In 2018 and 2019, the industry attracted FDI of INR 1,500 crore approximately and has been growing exponentially. Details of Foreign Direct Investment – FDI is available on the given link.
  3. The industry’s estimates indicate that fantasy sports platforms and operators cumulatively paid INR 166 crore in goods and services tax (GST) in Financial Year 2019 and INR 445 crore in Financial Year 2020. Read about Goods & Services Tax on the linked page.
  4. Fantasy sports platforms have resulted in growth in digital transactions, which has been a long-standing objective of the “Digital India” campaign, driven by the Government of India. Go through the details of Digital India on the given link.

Regulation of Fantasy Sports

  • Niti Aayog submitted a draft report titled ‘Guiding Principles for the Uniform National-Level Regulation of Online Fantasy Sports Platforms in India’, and recommended the formation of a self-regulatory organization to govern fantasy gaming.

Know more about the National Institution for Transforming India (NITI Aayog) on the linked page.

  • The report talks about uniform countrywide regulations for fantasy sports to ensure growth in the industry and removing the impediments caused by continuous legal challenges against all forms of online real-money gaming in different states.
  • The NITI Aayog report claims that the Indian online fantasy sports market has recently overtaken the US online fantasy sports market in terms of the user base.
  • It suggests that banning fantasy sports might not be a good decision as it will discourage innovation in this sector that has seen robust growth. Online fantasy sports in India have grown at a compound annual growth rate (CAGR) of 212%, from 2 Million users in 2016 to 90 Million users in December 2019.
  • Fantasy Sports could attract foreign direct investment (FDI) of more than INR 10,000 Crores over the next few years, as well as generate 1.5 Billion online transactions by 2023.
  • As there are no set of government regulations, Fantasy industry standards are regulated by the Federation of Indian Fantasy Sports – FIFS. Self-regularisation norms for the Indian fantasy sports industry is set up by the federation until the government comes out with any standards and laws.
Federation of Fantasy Sports – FIFS

  1. The Federation of Indian Fantasy Sports (FIFS), a self-regulatory industry body, based on the High Court rulings- has formulated the FIFS Charter that outlines the best practices and standards to be followed by the industry in order to be legally compliant.
  2. The fundamental principle of the FIFS Charter is to ensure that its signatories strictly adhere to the Charter and do not engage in any non-compliant activities on their respective platforms thereby safeguarding consumer interest and ensuring that fantasy sports predominantly remain a game of skill.
  • Under the Constitution of India, the state legislatures have been given the power to frame state-specific laws on ‘betting and gambling’. The public gambling act of 1867 has been adopted by certain states. The other states in India have enacted their own legislation to regulate gaming/gambling activities within its territory.
  • Andhra Pradesh, Telangana, Odisha, Assam and Tamil Nadu have enforced complete bans on online real-money gaming, while Sikkim and Nagaland, require companies offering online games of skill to register for special licenses for conducting operations.

Fantasy Sports Regulation – Benefit

Formal recognition of the fantasy sports industry and providing for principle-led governance would enable Indian Online Fantasy Sports Platform (OFSP) operators to focus on innovation and achieve scale and expand their operations in a clear and principle-based regulatory environment.

Aspirants can know more about various government bodies on the given link-

Is It Legal to Play Fantasy Sports in India?

  • The legality of fantasy sports in India is dependent on whether the game qualifies as a game of skill or game of chance. The latter falls under the ambit of gambling and is, hence, restricted by state gambling laws.
A game of chance is one in which outcome is strongly influenced by the application of some instrument which can include but is not limited to dices, spinning wheels, picking cards, numbered chits drawn from a bowl etc.

While a game of skill is one where the outcome is determined mainly by physical or a mental skill where chance has a very minuscule to non-existent role. A game of skill is, therefore, one where a player needs to constantly learn, practice and refine skills to be able to perform in a game.

  • Online Fantasy Sports as a sector has been widely debated on being a game of chance rather than a game of skill even though it is so clearly a skill-based format that is played by sports enthusiasts.
  • There are multiple High Court rulings that recognize the legitimacy of Online Fantasy Sports subject to them being played in certain specified formats.
  • The fundamental petition challenging the views of the Bombay Highcourt regarding Dream11 being a game of skill was dismissed outright by the Hon’ble Supreme Court and one of the standing orders while discussing the matter of GST has clearly instructed that tax matters need to be argued on merits and not on contentions related to the legality of fantasy sports.

Fantasy Sports Industry – Way Forward

  1. Fantasy Sports Industry can be seen as the next emerging industry that will not only grow out of India to the world but can significantly contribute to the growth of sports in India.
  2. With a fast emerging “Digital India” and increasing internet penetration backed by smartphones, the rise of league-based sports and online viewership, fantasy sports is sure to pick up well in India in future.
  3. The online fantasy Sports has the potential to contribute to other existing businesses as well that includes online sports content aggregators, online sports streaming, online sports scoring platforms, sports merchandising and e-commerce, digital payments, travel & sports experience, online coaching & sports turf management, cloud services, etc.
  4. It can significantly create and Increase employment in the field of sports and allied services in the nation.

Read about Startup India on the given link.

  1. Indian companies can become world leaders in future as sports is an all-embracing phenomenon with fans existing all over the world.

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