Online Gaming & New Regulations in India

Online gaming has seen a significant surge in popularity in recent years, especially in India. With the growth of the internet and mobile gaming, it has become an important industry in the country. However, as with any rapidly growing industry, there have been calls for increased regulation to ensure fair play and consumer protection. Here’s a brief overview of the current state of online gaming regulations in India.

Legality: Online gaming is legal in India, but with certain restrictions. The Indian government has imposed restrictions on online betting and gambling. Under Entry 34, List II, of the Constitution of India, each Indian state has the power to regulate betting and gambling within such state. This has led to different Indian states coming out with different definitions of betting or gambling. The government views online betting and gambling activities as a potential source of money laundering and corruption, and has therefore imposed restrictions on them.

Governing law & Regulatory Body: Currently, there is no dedicated regulatory body for online gaming in India. The Ministry of Electronics and Information Technology (MeitY) is responsible for overseeing the sector, and the Information Technology Act of 2000 governs online activities in India. On 2nd January, 2023, MeitY has issued draft rules for regulation of online gaming in India. The proposed provisions has been introduced as an amendment to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.

Proposed Amendments : The draft rule defines Online games. The draft amendment classifies provider of online games as an “intermediary” under the Information Technology Act, 2000. It covers the games wherein winnings are payable both in cash and kind. All online games needs to be registered with the self-regulating body. The Draft Amendments imposes additional compliance requirements on Online Gaming Intermediaries.

Consumer Protection: One of the biggest concerns with online gaming is the protection of consumers. There have been instances of players being cheated, and there is a lack of a proper dispute resolution mechanism in place. The government has taken steps to address this, but more needs to be done to ensure that players are protected.

Conclusion: In conclusion, the regulation of online gaming in India is still in its early stages, and there is a lot of room for improvement. Inclusion of Online Gaming Intermediaries in the IT (Intermediary Guidelines & Digital Media Ethics Code) Rules, 2021, is a significant development and gives a clear idea of the government’s approach towards Online Gaming Intermediaries. The government needs to provide clear guidance on taxes and consumer protection. With proper regulations in place, online gaming in India has the potential to become a thriving industry, providing employment and entertainment for millions of people.

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The article has been authored by Ms. Ruchika Agarwal of Mind Sync Business Solutions. For more details Contact: customer.care@mindsync.co.in