It is without a doubt that the internet has transformed the events and ticketing industries, which were earlier dominated by street touts and middlemen. With the seamless integration of global payment methods along with the convenience of booking tickets via mobile applications and websites, the industry has certainly undergone a transformation. However, while the industry has evolved, the law has not.
Ticket scalping is a term often used to describe the act of individuals or entities buying tickets for specific events, and then reselling such tickets at a higher price to make a profit.
In India, there is no legislation that governs the issue of ticket scalping or ticket resale. Some states have made an attempt to govern on the matter. An example would be the Maharashtra Entertainment Duty Act, 1923, which has specific provisions laid down, prohibiting the resale of tickets for certain events above their face value. Some states also have legislations providing for the payment of entertainment tax, however, as of now, none of the legislations squarely cover the practice of ticket scalping. Given the legislative lacunae, the primary legislation governing ticket scalping in India is the Indian Contract Act, 1872 ("Contract Act"). As per the Contract Act, a contract for the sale of a ticket is valid if it meets the essential elements of a contract, namely, offer, acceptance, consideration, and lawful object. Thus, if a buyer is willing to pay over and above the face value for a ticket, it will be a valid contract, unless there is cheating or fraudulent inducement for the delivery of the said ticket.
However, the police departments of some states have made an attempt to rein in the nuisance caused due to ticket scalping. As recently as April 2023, the Chennai police arrested 24 people for the sale of tickets for the IPL matches being held during the time. Similar arrests have been made in Punjab. Interestingly, the High Court of Punjab and Haryana in 2015 dealt with a matter of ticket re-sale for a cricket match. In the given case, an individual was arrested and charged with Section 420 of the Indian Penal Code, for selling tickets for a price much higher than the face value. However, the High Court of Punjab and Haryana in the case of Mandeep Singh vs UT of Chandigarh refused to take action against the accused, stating that there was no cheating involved in the given case, as the seller and the buyer had full knowledge of the tickets for which the transaction was being undertaken. In the given case, the Chandigarh police had undertaken an undercover operation to nab the accused in the act of selling tickets for a higher price. These cases are an example of the issues arising due to the lack of relevant legislations for ticket scalping. A holder of a ticket is within his legal rights to sell his ticket to a willing buyer at whatever price is negotiated between the buyer and the seller. However, exorbitant pricing of tickets in the secondary markets due to hoarding and ticket scalping is a real issue for fans or event-goers. Thus, the dilemma.
Scalping, at the end of the day, provides a secondary market for tickets, allowing consumers to buy tickets for sold-out events when they missed the initial sale. It also offers convenience for those who need to purchase last-minute tickets for events they had not planned to attend initially. However, ticket scalping does lead to exorbitant prices, making it difficult for many genuine fans to afford tickets for popular events. This can create a situation where only those who can afford the inflated prices get access, potentially excluding genuine fans and undermining the principle of fair and equitable access to events. Furthermore, the practice of ticket scalping also raises an issue wherein crowds are segregated to ensure crowd control. An important example for the same is football matches held in Europe, wherein the "travelling" or "away" fans are often given tickets in a different stand, so as to ensure that there is no violence between the "home" fans and the "away" fans. This is also applicable to other events; especially wherein large crowds are expected and cordoned areas are created for the safety of female viewers. The scalping of tickets reserved for females often leads to overcrowded males' sections, leading to headaches and problems for event organisers.
While event organizers and artists benefit from scalping which indicates high demand for their events, and the increased ticket prices can boost revenue for organizers and artists, excessive scalping also tarnishes the reputation of events if it is perceived as exploiting consumers or taking advantage of their enthusiasm. Some examples of measures taken by other countries to address ticket scalping includes the introduction of legislation to prohibit the use of automated bots to purchase tickets in bulk.
As per the French Consumer Code, the resale of tickets is prohibited at a price higher than its face value, without the consent of the event organizer. While the United States of America does not have a uniform federal law on the issue, similar provisions restricting the resale price of a ticket to its face value can be found in New York and California. Attempts were also made to limit ticket scalping by making it illegal in the United Kingdom by introducing amendments in the Consumer Act and the Criminal Code of the country. However, with modern day technology, ticket scalping platforms have come up, often registered in different countries, and thus, easily bypassing the current regulations. Case in point would be StubHub, which is a company headquartered in the United States of America, but registered under the laws of Switzerland, and operates in various European nations including the United Kingdom, wherein the practice of ticket scalping was effectively banned.
While the legality of ticket scalping in India remains an issue that has not been addressed by legislators or policymakers, the need to address the same grows constantly. With India attempting to host more and more international sporting events, as well as the increase in artists from all around the world performing in India in global music festivals like LollaPalooza, Sunburn and Boiler Room the need to govern ticket scalping is pertinent.
Ultimately, it is essential for policymakers, event organizers, and stakeholders to work together to find a solution that ensures fair access to events while respecting the rights of ticket holders and the interests of the sports and entertainment industry.
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