Introduction
Concerts are a great way to relieve oneself but recently concerts have opened new avenues for hoarding, black-marketing and reselling of tickets as a large scale. On 22nd September’ 2024, Coldplay announced its concert scheduled in India next year and the tickets for the albeit initially being sold in the price range of 2,500 to 12,500 INR are being sold for a price as high as 9,00,000 INR. The same story goes for the tickets being issued for Diljit Dosanjh’s concert, Oasis Concert and even tickets for matches of World Cup. This is a serious issue which affects the society on a large scale. Through this article, the concept of Ticket Scaping will be discussed, then the article will delve into the applicability of different legislations on this issue and finally the article will provide an analysis and a conclusion.
Ticket Scalping: Meaning and Examples
Ticket Scalping is a term used to define a practice in which individual or individuals or a company buys tickets of various events either directly or indirectly and then sell such tickets at a price severely higher than the original price of the tickets.
With the advent of technology and the convenience of buying tickets easily through any device connected to the internet and having requisite payment details of your account, it has become easier to buy tickets in bulk either by different persons or through Bots. Bot is a short form for robots, it means a software program which is program to perform task automatically. Such Bots are used for buying tickets in large scale in order to hoard them and resale. Such tickets are then sold at exorbitant prices through various enterprise and person both online on platforms like telegram and physically also.
Examples of such a practice are the recent public furore due to the Coldplay tickets fiasco, Diljit Dosanjh’s tickets fiasco, Taylor Swift, World Cup ticket fiasco and many more such instances. The platforms which indulge in such practices are Viagogo, Tickets master etc.
Applicability of Different legislation in India
In India although there is no legislation which specifically deals with this issue, there are statues which is applicable to the issue of ticket scalping partly but not wholly. Under this part, we shall discuss the applicability of two laws, namely: (A) Competition Law and (B) Criminal Law.
- Competition Law
In India, the Competition Act, 2002 deals with the issues relating to anti-competitive behavior or behavior which harms the competition or the consumers in the market. Although, the Competition Act does not have a dedicated Section towards hoarding and resale of goods in black market, the act prohibits such acts though Section 3 which talks about anticompetitive agreements.
. Section 3(1) of the Competition Act says that any agreement entered between persons, association, enterprises or group of person or enterprise which causes an Appreciable adverse effect on Competition is prohibited under this act (AAEC).
Further, Section 3(4)(e) includes “resale price maintenance” agreement under the agreement prohibited by Section 3(1) if such agreement result in AAEC. Rule of Reason approach is adopted by the Competition Commission of India (CCI) to analyze whether an agreement is anti-competitive or not. Rule of Reason approach includes evaluating the pro-competitive features associated with the conduct with the anticompetitive effects caused due to such conduct.
Section 19(3) of the Act lists the factors which needs to be taken by the CCI while evaluating whether an agreement causes AAEC or not. Section 19(3)(d) states accrual of benefits to consumers as factor to be considered. Accrual of benefits means whether there is any compensation given to the consumers to neutralize the effect of an anticompetitive agreement.
Ticket-Scalping is an anticompetitive practice as firstly it causes harm to the consumers as consumers have to pay a severely disproportionate price for the goods for services. For example, the tickets of Coldplay concert initially being sold at INR 2,500 are now being sold for a price as high as INR 9,00,000. Similarly, the world cup tickets which were initially priced for INR 4000-5000 were sold for a price over INR 2,00,000. The price band on which the tickets are resold are more than 20 times the original price which in itself is a concerning issue as it is a clear violation of the rights of consumers.
(B) Criminal Law
Companies can be prosecuted under criminal breach of trust or cheating for the offence of black marketing. People were ready to book tickets as soon as the portal was going to be opened on book my show but the tickets were sold out in under thirty minutes. People have alleged that many accounts were logged out automatically and people have alleged that book my show were involved with hoarding companies.
Problems associated with applicability of laws
Under this section, the problems associated with applicability of the laws mentioned will be discussed.
- Competition Law
The problem that arises during the application of Competition Act is that persons acting in individual capacity (dealers, traders) cannot be prosecuted under the Competition Act. Although Section 48 of the act makes persons who are in charge of a company liable for anti-competitive agreements, there is no section which imposes liability on persons acting in individual capacity.
Recently, Book My Show, the platform involved in the sale of tickets is being alleged to have sold the tickets to enterprises involved in black-marketing and resale business. Its CEO has been summoned by Mumbai Police recently.
Another problem is that there is no specific section which “directly” deals with the hoarding and black-marketing of goods. The objective of the competition act as stated in its preamble is to prevent anti-competitive practices and prevent harm being caused to the competition prevailing in the market as well as the “consumers”. If the objective is to prevent harm to consumers, there should be a specific section which deals with the issue of black marketing and hoarding.
- Criminal Law
The problem with the applicability of criminal law is that a person knows that he or she is purchasing goods at an exorbitant rate and these goods is coming from a person associated with the black market. In order to proves crimes like criminal breach of trust and cheating, it is very important to prove that the person who has been cheated or the aggrieved person was not aware about the real situation, meaning in the present case, the persons would need to prove that they were not aware that the tickets they were buying were not hoarded. This problem can be further recognized from the order of Punjab and Haryana High court in the case of Mandeep Singh v UT of Chandigarh, in which the court exempted the person from liability as both the buyer and seller had knowledge about the details of the ticket and transaction.
Solutions
- Amendments in existing laws
The Competition Act should be amended to include either (i) A specific provision dealing with the issue of hoarding or (ii) a provision that goods which are prone to be hoarded and black marketed should not be resold. Meaning, goods such as tickets that too of events which are very popular are prone to be hoarded and resold at a higher price. There should be classification of goods based on their probability to be hoarded and restrictions and punishment should be imposed accordingly.
For Example: High Risk goods would involve tickets of popular events or essential commodity goods (Although essential commodity goods are legislated under a separate act) or any other goods which will have a very high resale value. Low Risk goods would include goods which does not have a resale value.
- New legislation
The government can bring out a new legislation which prevents hoarding and black marketing of goods by imposing punishment in the form of fines and in rare cases, penalization of such offences. The government can take reference from other jurisdictions, like US. The US government passed the BOTS in the year 2016, the Act bans bypassing online security measures used by ticket issuers and prohibits selling tickets obtained through such bypassing if the seller was involved or aware. It applies to events at venues with over 200 seats. The Federal Trade commission brought the first ever case under this act in 2021 in which it initiated legal action against 3 new York brokers subjecting them to a judgement of more than $31 million.
Similarly, the issue of selling of tickets of European football matches at exorbitant prices was tackled by the UK government under the Criminal Justice and Public order act 1994. Section 166 of the same act prohibits resale of tickets of football matches by an unauthorised entity.
Conclusion
The issue of ticket scalping affects the public at large and this issue is being repeatedly highlighted recently in sale of ticker of concerts. There is no legislation which specifically deals with this issue and this makes the people associated in black marketing and hoarding evade the liabilities or penalisation. The way forward can be amendments to existing laws or passing of a separate law. The government and the authorities concerned will need to take pro-active action as this issue can become a very big problem in the future.
(This post has been authored by Gurman Narula and Sharad Khemka, students at National Law Institute University, Bhopal)
CITE AS: Gurman Narula and Sharad Khemka, ‘Ticket Scalping Fiasco: Need for a change in the Law’ (The Contemporary Law Forum, 18 October 2024) <https://tclf.in/2024/10/18/ticket-scalping-fiasco-need-for-a-change-in-the-law/>date of access.