Being a lawyer, I was repeatedly asked by my friends- How come fantasy cricket apps are operating in India, when gambling is banned. My answer was simple-
It’s regarded as a game of skill and not a game of chance, as decided by Rajasthan HC in Ravindra Singh Chaudhary vs. Union of India (2020). Yet, the answer seemed incomplete.
Therefore, I decided not to rant about it with cynicism, but to test the argument and at the same time preparing my masters dissertation. It was a good distraction from all the chaotic news of covid-19, which is simply depressing.
However, my research came to a halt with the suspension of Indian Premier League 2021, due to Covid cases in the apparently safe ‘bio bubbles’. But this article focuses on immediate problems that IPL suspension has brought with it- for the consumers and the economy.
The industry of fantasy cricket has set up two organizations for its own regulation. First is Delhi based Federation of Indian Fantasy Sports (FIFS, previously called IFSG), whose founding member is Dream11, the official sponsor of IPL. Second is Mumbai based All India Gaming Federation (AIGF), which has big names like MPL and Paytm First Games.
Then there are companies like Gamezy with KL Rahul as its brand ambassador. Their websites state that they are not affiliated with any authority. So its caveat emptor (let the buyer beware) for a layman, who hardly goes through such details, despite of all the financial information that these companies collect- PAN card, Bank Details and AADHAR.
Even the self regulation doesn’t guarantee, that these companies won’t shut down. FIFS website mentions Mykings11 and My11Kings as bronze members, but both these apps are defunct. FIFS has not updated its list of members and their members have not updated the terms and conditions to replace IFSG (older name) with FIFS. In such a situation, it’s very tough to trust an industry for whom NITI Aayog had proposed regulatory guidelines.
All these apps have one thing in common- Wallet, which is the record of a consumer’s financial transactions with the respective app. A consumer’s money is generally divided into 3 parts- Unutilized Money, Winnings and Bonus. Bonus is what the company gives to its consumer for availing discounts on various products offered by the app. Understandably, this money cannot be withdrawn by the consumer. Winnings is what you earn on the app. The problem is with Unutilized Money/ Added Money.
Unutilized Money is the fresh money that you add in the wallet through electronic payment. Most of these apps do not allow the withdrawal of money that is added to the wallet. However, this money is used on a priority basis and when it gets over, the winning amount is used for participation.
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As per my observation of contests with at least 50 percent winners and 1000 participants, a user can ensure that he doesn’t lose any money. For example, if you participate in a mega contest with Rs. 10 and do a bit of research on which players are consistent, you will win Rs. 10 if you breach the 50% winners criteria.
Therefore, in practice, it’s a cycle that transfers your unutilized money to your winnings. But there is a catch. There is a minimum withdrawal limit on all the apps that I have tested, with the exception MPL Pro. In case of industry leader Dream 11, this limit is Rs. 100, and in some cases, it is as high as Rs. 500.
My point is, with the sudden suspension of IPL all this money is locked with the apps. IPL was exactly at halfway and it’s no rocket science that most of the users have entered fantasy sports space because of the IPL and promotions related thereto. It is like the insurance sector now. People ignore their claims, due to which the company becomes highly profitable.
Think about the amount of money these companies will earn, just by holding onto the money for a couple of months and earning interest on it. There are millions of users on these platforms and the amount of money locked in this way is huge.
The implied permit of the government had two novel objectives- firstly to give a positive distraction of sports and secondly to keep public savings in the economy. Look at the sponsors of IPL. Either they are fantasy sport companies or stock trading apps and both of them promote increased investment and decreased savings.
But, we have entered a phase of Covid 19 pandemic, where people are being exploited just because the government is busy in disease control and no one is looking. Its time for us lawyers to be ‘devil of the details’ and ensure judicial activism against any prospective exploitation. Entities involved in profiteering and black marketing should know that we are looking, even when the government cannot.
Advocate at Allahabad High Court, Lucknow
B.Com LLB (H); LLM (Constitutional Law)
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