Matrix Law advised e-commerce gaming and auction company Madbid.com on setting up operations in India.

Matrix founding partner Sunny Sablok and senior associate Neha Verma acted for Madbid which facilitates “penny auctions” – customers bidding for products that are made available on the website at huge discounts.

Sablok told Legally India that no other global company with the same business model as Madbid has entered India as yet.

Sablok explained: “The business of Madbid is quite interesting. You have to buy credits to bid for products. If you win the bid then you get the product at a steep discount, while if you don’t win then you get additional credits which can be used to bid for another product.

Which means that you never lose your money while at the same time you have a good chance of winning bids for products at a steep discount. Its A win- win situation.”

He said that since gambling, gaming and auction are currently unregulated in India, the research the firm had to do on this transaction “was quite deep”.

“It is not gambling since you lose nothing. It is not gaming either since it technically does not fit into the definition of gaming under the Indian laws.Therefore in our view it is an online auction which is not prohibited under the Indian laws,” he said.