Dream11 halts operations in Karnataka after FIR against founders

The Karnataka Police Act recently amended its gaming law to prohibit online gambling, betting & wa

Mumbai: Online sports platform Dream11 has suspended Karnataka operations of its gaming app Dream11 after its directors were booked under the amended Karnataka Police Act, which seeks to ban online gaming. 

Following the filing of a first information report (FIR) against its founders in Bengaluru under the state's newly legislated Karnataka Police (Amendment) Act 2021, the homegrown sports tech company said in a statement on Sunday, “Following the recent media coverage, our Karnataka users have expressed deep concerns and anxiety for their safety and security. In order to allay our users' concerns, we have decided to suspend operations in Karnataka.”

The Karnataka Police Act recently amended its gaming law to prohibit online gambling, betting, and wagering. On Saturday, the Bengaluru Police filed an FIR against Dream11 founders Harsh Jain and Bhavit Sheth subsequent to a complaint that the Mumbai-based firm had continued to offer gaming services on its platform a week after the state government notified the new rules disallowing what it termed as “games of chance."

Dream11 said that the complaint was “motivated” and it is examining legal remedies. 

With this, the online gaming platform has joined the likes of Mobile Premier League (MPL), Paytm First Games, Games24X7, and others, which have deactivated their platform for users in Karnataka.

Dream11, however, continues to maintain that it is compliant with all the laws. “We have been advised by the Federation of Indian Fantasy Sports (FIFS), who have shared an opinion from a former Supreme Court Judge, stating that the Karnataka Police (Amendment) Act 2021 does not apply to its member Fantasy Sports Operators. This is because the FIFS format of fantasy sports has been upheld by the honourble courts of India as not amounting to gambling, betting, or wagering,” said the company in a statement.

Karnataka’s new law, which came into effect on 5 October, bans online games that are "games of chance" in nature. It makes operation, abetting, or sheltering of online games involving the exchange of money, betting, and wagering “cognisable and non-bailable offence.”

The move comes at a time when the Indian Premier League (IPL) is underway and the T20 Cricket World Cup is slated to start later this month. These sporting events are crucial for the gaming platforms to drive engagement and acquire new users in what’s a competitive industry.

The Dream11 platform allows users to play fantasy cricket, hockey, football, kabaddi, and basketball on its app. The firm became the first Indian gaming company to enter the unicorn club in April 2019 after an investment took its valuation at over $ one billion.

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