No satisfactory and individual law for the Fantasy Sports industry, somewhere affecting the growth of the Fantasy Sports industry. In-country like the UK, there is one common rule for Fantasy Sports operators, but like in India; it’s a matter of state government. By the time some Fantasy Sports platforms have proved themselves and won the tag of “skill-based game” and get the permission to host the services in different regions.
We have dug deeper and found out the laws related to the Fantasy Sports industry in different regions.
Fantasy Gaming Apps – “Game of Chance” Arguments why fantasy gaming apps are a game of chance.
As per the dictionary, gambling is the act of risking one thing to win a prize (especially money). Considering the definition of gambling, Fantasy gaming is about taking a chance with the involvement of money risk to win a prize. It might need user skill to create a team, but no control over the athlete’s performance on-field was the reason given by the New York Supreme Court unconstitutional or a game of chance.
There are high chances of manipulation in online games, which makes it a game of chance only.
Fantasy Gaming Apps - “Game of Skill”
A game of skills is a game that is dominated by the skills and its results are influenced by the Fantasy user’s ability and not a chance. To find the nature of the Fantasy Sports platform, the Government relies on the dominant factor test.
For an app to justify the “game of skill”; skills should dominate the entire game- from team formation to results.
During the Varun gambler vs Union Territory of Chandigarh and Ors case in the Punjab and Haryana Court considered the Fantasy games as games of skills because of the below reasons:
- Assess players based on their ability
- Fair chance of winning the contest
- No biases towards any team or individual
- All the players are selected based on past performance
- A team should consider factors that affect their winning in the game
- Results should be transparent
Legal Status of Fantasy Sports in Other Countries
The legal status and laws for the Fantasy Sports industry change from region to region. Here we have summed up the herd rules for the Fantasy Sports operators in India, the UK, the US, and Australia.
There are very limited individual laws designed for the Fantasy Sports app, but there are some laws that cover the activity in the respective industry. Till today, the Fantasy sports industry is considered gambling and not recognized under the schedule view in the Indian constitution.
Before coming under state rule, Fantasy sports were supposed to be governed under the central government legalization named – Public Gaming Act, 1987. The act states that; the game which involves skills shall not be considered under the gambling act. The Indian government further declared Fantasy Sports as a game of skill. Even in 2008, Sikkim, Online Gaming Act allowed the skill-based game to acquire a legal license.
Government laws on the Indian Fantasy Sports Industry:
- Users below 18 are not allowed to participate in the fantasy gaming apps
- The platform should be skilled based
- Deadlines like – a user can’t change the squad later
- While playing any contest, the user needs to follow all the rules mentioned in the terms and conditions
- Allowed to create a team of real sports players
- All the contests will be organized for future matches and not past events
- Members are not allowed to offer gambling services
The operator must ensure that the contest organized on their platform should not fall under any category of gambling.
To boost the growth, centrally and nationally administered guidelines are required for the Fantasy Sports industry; suggested SPLC report.
Though the development of laws and guidelines is limited as compared to other developed countries. However, the most essential thing is that fantasy gaming apps are getting recognition and are being considered as the game of skill that protects the app developers from any criminal liability leading to the growth of this industry.
In the United States, the legalization of Fantasy Sports is both a Federal and state issue. The demand for Fantasy sports in the US is so high, that the government needs to create laws that support the regulation of Fantasy Sports. There was an Interstate wire Act introduced, under which legal gambling was allowed but there were restrictions on sports betting.
In 2006, a new law was introduced called the Unlawful Internet Gambling Enforcement Act which exempted Fantasy games from the arena of gambling or betting.
In 2014, a bill named Interactive Fantasy Sports Bill was released and signed by Governor, Mr. Andrew Coumo which states that Fantasy games are allowed in the state of New Your, only when the developers have a license.
Furthermore, the law depends on the states; some states legalized the usage of Fantasy sports whereas others still consider it legal and have shown a restrictive approach.
Like India, Australia is also not open to the regulation of fantasy games. The interactive gaming Act came into effect in 2001. The act allowed players to play games based on skill and restricted the gaming! As the Fantasy Sports industry grew, in 2015, an amendment bill was passed to the Interactive gaming act permitting the regulation of the Fantasy Industry.
And recently in 2021, as per the new amendment, all Fantasy Sports operators can regulate their business by acquiring a legal license from the authority and can only conduct skill-based game activities.
In the United Kingdom, the operation of the Fantasy Sports industry is quite sorted. The Fantasy Sports industry comes under the Gambling Act of 2005 which allows the functioning of fantasy sports platforms with the license.
This law is applicable across the nation which avoids the struggle to deal with state or regional law. Operators need to acquire the Gaming Commission of Licence. But, to get the license all rules and regulations need to be comprehended.
With time, the Governments are taking a step forward to understand the Fantasy Sports industry better and differentiating between ‘game of chance’ and ‘game of skill’. The industry has such a bright future that it is only gonna generate huge revenue and will improve the contribution of the Sports industry to the growing economy of the nation. Fantasy App Developer can assist you with fantasy sports development and initiate your journey in the respective industry.