Understanding Fantasy Sports

Take a closer look at the skills, strategy, and science behind Fantasy Sports. Learn not only how to participate in Fantasy Sports but
also about the guidelines, rules, and safety measures that surround them.

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Frequently Asked Questions

Everything you need to know about the product and billing.

Fantasy sports are team-selection skill-based contests, based on real-life and live sporting events, wherein contestants use their knowledge of athletic events and athletes to select or manage rosters of virtual athletes whose performance directly corresponds with the actual performance of human athletes during a complete live officially sanctioned sports match. While retaining the common elements that have been universally accepted, FIFS has further provided for certain guardrails to be adhered to by the FIFS members while offering FS contests:

  1. Contests which are based on at least one complete real world, live, upcoming sports match;
  2. Contests based on matches that have been officially sanctioned by an international, national or state sports federation/association;
  3. Contests where the fantasy team comprises of at least the same number of players as a real life sports team in the underlying real world sports match;
  4. Contests where a fantasy team comprises of athletes from at least two real world teams;
  5. No manual changes to the fantasy team after commencement of the real world match;
  6. All team selections on FSP’s to mandatorily have manual interventions;
  7. Platforms cannot participate against users

There are 1000+ companies that currently offer FS across the world. In 2021 there were approximately 607 businesses in the US in this sector which was forecasted to increase to about 656 in 2022. In India, there are 200+ operators. The FS industry across the US and Canada is estimated to have grown from about 5 lakh users in 1988 to 5.9 crore users in 2017, translating to a CAGR of 14 percent, over the course of 29 years. India in 15 years has surpassed the US in terms of number of users with 16+ crore Indian users.

The courts in India, on multiple occasions, have had an opportunity to interpret the term ‘games of skill’. The important factor to take into consideration is- whether the element of skill predominates the element of chance or not. Globally, the following tests are used to distinguish games of skill from games of chance:

  1. (i) the dominant factor test, or predominance test, where games of skill and chance lie on a continuum between pure skill and pure chance,
  2. (ii) the material test, which tests whether the role of chance in a game meaningfully determines its outcome.

The Indian judiciary has recognised the concept of a game of mere skill wherein they have applied a predominance test and has held that a game is a game of mere skill if the element of skill predominates the element of chance. This test has been consistently used by courts in various judgments to hold that Dream11’s format of fantasy sports which is based on full real live matches is a game of skill.

For determining whether a game is a game of skill or not, the courts have applied a predominance test. The mere involvement of a monetary stake or something of monetary value does not alter the nature of the game, and hence games of skill even when played for money will remain games of skill and cannot be considered to be gambling, betting, or wagering. This has been affirmed by the Karnataka High Court in the case of Federation of Indian Fantasy Sports v. State of Karnataka and Kerala High Court in the case of Head Digital Works Private Limited v. State of Kerala. Further, it is important to note that multiple petitions were filed before different High Courts against Dream11’s pay-to-play format of fantasy sports. The courts have consistently held that Dream11’s format of fantasy sports is a game of skill and the same does not amount to gambling/betting.

The Bombay High Court in the case of Gurdeep Singh Sachar v. Union of India while holding that fantasy sports is a game of skill not amounting to betting and gambling and the platform is not in error in paying GST @18% on platform fees stated as follows:

Quote “It is evident that the expressions ‘betting’ or ‘gambling’ were used interchangeably in Section 65B(15) of the Finance Act, 1994. Again the test applicable was whether it was a game of chance or game of skill. Only if the result of the game/contest is determined merely by chance or accident, any money put on stake with consciousness of risk and hope to gain, would be ‘gambling’ or ‘betting’.” unquote.
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