Niti Aayog suggests unique self-regulatory body for the online fantasy sports industry

Government think tank Niti Aayog proposed to set up a unique self-regulatory organization for the online fantasy sports industry to be governed by the independent supervisory board and also suggested restricting online fantasy games to users. 18 years old and over.

In a draft report titled “ Guiding Principles for the Nationwide Uniform Regulation of Online Fantasy Sports Platforms in India, ” Aayog said there was a public interest in the industry fantastic sports is recognized by the government as an industry and having its own identity. A unique self-regulatory organization for the fantasy sports industry should be recognized by the government, he added.

“Such a self-regulatory body should be a single-purpose body of the fantasy sports industry and be a member of online fantasy sports platform operators (OFSP),” the report said.

Noting that while OFSPs operate through online media on a pan-Indian basis, the report indicates that the revenue from their regulation varies across state regulatory regimes.

The Aayog said: “This means that the interests of users of fantastic sports in terms of transparency, OFSP operator integrity and fairness may vary from state to state, resulting in an inconsistent experience and the risk of shopping in the forum / jurisdiction. “

“It may even deprive sports fans in some states of their right to actively engage in these OFSPs,” he added.

The online fantasy sports platforms (OFSP) offer fantastic sports competitions.

Fantasy sports are unlike any other form of online gambling as they depend on the news, seasonality and availability of real-time sports matches, making it a non-addictive form of gambling.

This clearly distinguishes it from other forms perceived to be of the nature of gambling or betting.

“Pay-to-play fantasy sports competition formats should not be offered by an OFSP operator to users under the age of 18,” Aayog said, adding that all necessary safeguards to protect minors must be in place. .

According to Niti Aayog’s draft report, the governance of the self-regulatory body should be entrusted to an independent supervisory board made up of reputable individuals with experience in governance, law and administration, who can be elected. or appointed by the members of the self-regulatory body. fixed term.

The self-regulatory body should establish an independent grievance mechanism to deal with consumer / user complaints against OFSPs as well as any disputes that arise between or in connection with OFSPs, he added.

According to the draft guidelines, the existing legal ambiguity and differential treatment faced by fantasy sports games in Indian states should be addressed through the establishment of a nationally uniform safe haven for fantasy sports games.

“This will enable the implementation of a single national fantasy sports policy and bring clarity to regulators, operators and consumers,” he said, adding that the government should consider a light regulatory framework for the sports industry fantastic given the dynamic and technical nature of the activities.

This approach, according to the draft guidelines, will facilitate the creation and growth of the market.

“Self-regulation must also be the preferred mode of governance to ensure ongoing transparency, consumer protection and accountability,” he said. The draft document also underlined that the independent supervisory board should be responsible for uniform guidelines and ensure continued adherence and compliance with FOPHs. “All FOPHs that are members of the self-regulatory organization should benefit from the Safe Harbor exemption, subject to their compliance with established standards and procedures,” the report said.

These guiding principles can be treated as a uniform regulatory sandbox and can be recalibrated based on innovations and developments taking place in the industry, Aayog observed.

In a recent market report, KPMG noted that the number of users participating in online fantasy sports in India had increased at a compound annual growth rate (CAGR) of 212%, from 2 million users in June. 2016 to 90 million users in December. 2019.

In addition, the report estimates that the fantasy sports industry has the potential to attract foreign direct investment of over Rs 10.00 crore over the next few years and generate 1.5 billion online transactions by now. 2023.

A report from PricewaterhouseCoopers India noted that the fantasy sports industry has the potential to generate 5,000 additional direct jobs and 7,000 indirect jobs in the next 2-3 years.