ESSA calls for regulation in Law Commission of India's gambling consultation

International betting integrity body ESSA has published its response to the Law Commission of India's gambling framework consultation, recommending that the country adopts a liberal, multi-vertical regulatory system to curb illegal gambling and generate additional revenue through taxes.
ESSA said that it welcomed the review initiated  by the Law Commission, which was mandated by the Supreme Court to study the possibility of legalising betting in India.
This was part of various proceedings regarding the governance practices and integrity issues surrounding Indian cricket and the Board of Control for Cricket in India (BCCI).
"While considering legalization of betting, leaving aside gambling may render the whole exercise futile," said Justice Chauhan, chairman of the Law Commission of India earlier this year. "Therefore, the Commission would like to study the issue of legalizing betting as well as gambling in the country."
The former judge said that strict rules against betting and gambling had not necessarily acted as a deterrent, with online gambling and betting another area which had become very difficult to curb.
In its response, ESSA noted that only the state of Sikkim had enacted a law for sports betting which was limited to a small number of physical premises and an intranet facility confined within the state.
"The result is that betting on sports, outside of horseracing, is generally not currently permitted across much of India (retail or online) and there is no licensing or regulatory oversight in place," said the integrity body. "Nevertheless, driven in part by the availability of sports broadcasts and new technologies, there is a significant and growing consumer demand for betting on sporting events in the country."
ESSA also highlighted that this situation had given rise to widespread illegal betting on many sports, particularly cricket.
"This has led to a situation that has unfortunately benefited criminal elements (illegal betting, money laundering, match-fixing etc.) and has been to the detriment of sport, related investment such as advertising and sponsorship income, public revenues and the wider society in general," it said.
"On the basis that prohibition of betting has proved ineffective, and where a renewed drive to impose it would appear impractical, a continuation of the status quo is clearly not advantageous."
ESSA said that policymakers must consider their market regulation and structure, notably whether to adopt a monopoly operator, limited or open licensing market position. It argues strongly against adopting a restricted number of licences, and believes that the adoption of an integrity framework was invariably weakened by the imposition of a licence limitation or monopoly provider of sports betting products.
"It is also fundamental to the viability of regulated betting operators and their markets that they are able to offer a wide range of products," continued ESSA. "Imposing restrictions invariably leads to consumers seeking banned products through other markets, including unregulated channels."
The integrity body said that moves to ban regulated in-play or live betting had been shown to be "borne of little supporting evidence and are of questionable benefit in a global market of differing regulatory models."
ESSA has also proposed the adoption of a taxation model that reflects the "international availability and dimension of sports betting products and is not over-burdensome from that perspective."
"The type and level of taxation significantly influences the size and product availability of the betting market and is an important driver of market growth, structure and consumer attraction," the association said. "Existing market evidence shows that betting operators and consumers are greatly attracted to a gross gambling revenue (GGR) tax, at a reasonable level, as opposed to a turnover tax regime."
In conclusion ESSA recommends that India should seek to adopt a policy that regulates and allows its citizens access to all types of betting products with a range of licensed betting operators as a means of maintaining both the viability and integrity of its sports sector and any licensed betting mark.

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