Legality of Sportiqo

Southridge tech systems pvt ltd, (“Sportiqo”) owns and operates the website http://uat.sportiqo.com/ (the “Website”) and the ‘Sportiqo’ mobile application (the “Mobile Application” and together with the Website, the “Platform”). Through the Platform, Sportiqo offers a virtual trading game where Users (as defined below) can purchase and sell virtual stocks attached to real-world cricket players (“Stocks”).

The Game is a game of skill in which success depends predominantly upon the superior knowledge of sports, principles of investing, experience, information gathering, analytical capabilities, understanding and adroitness of the player, sport related statistics, analysis of such statistics, knowledge of players’ relative form, players’ performance in a particular territory, conditions, format (such as for Cricket ODIs, test cricket and Twenty20 etc. among others ), attention and dedication, and adroitness in playing Sportiqo in terms of deciding the right player to choose based on past performance, future expectation, dividend winning capability and couple it with decision making capabilities.

Games of skill such as the at are legal in most states in India, as they are excluded from the ambit of Indian gambling legislations including, the Public Gambling Act of 1867 (“PGA”), which is the principal enactment concerned with the regulation of gaming or gambling in India.

As the Constitution of India authorizes its States to legislate on ‘gambling’, there are a number of States which have promulgated their own enactments concerned with the offer of gaming and gambling services within such States.

The PGA criminalises the act of ‘gambling’ in a public forum in India and the keeping of a ‘common gaming house’. The PGA distinguishes between betting on a “game of chance” and staking on a “game of skill” by expressly exempting “games of skill” from its penal provisions against gambling. Most State gambling legislations are in consonance with the PGA, and similarly exempt games where the outcome is predominantly based on skill.

Thus, Indian laws in general differentiate between games of skill and games of chance and specify a strict prohibition on participation and offer of games of chance for stakes, while taking a more favourable position with games of skill. In this regard, it may be noted that the Supreme Court of India in one of its verdicts in the Lakshmanan case concluded that “games involving a ‘substantial or preponderant’ degree of skill would amount to games of ‘mere skill’”.

While the PGA does not explicitly deal with internet gaming and gambling, legal practitioners and the judiciary have extended its principles to the online medium as well.