New Online Gaming Rules to Spur Innovation, Boost Investor Confidence

The government on Thursday released new rules for online gaming that prohibit games involving betting and wagering.

New Online Gaming Rules to Spur Innovation, Boost Investor Confidence

The uniform legal framework provided by these rules will boost investor confidence

Highlights
  • Norms are expected to reduce regulatory fragmentation at the state level
  • The framework should include repeated warning message at higher frequency
  • The government recognised the industry demands and provided light touch
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The industry on Thursday said the new rules for online gaming will spur innovation, boost investor confidence and weed out gambling platforms while making the sector globally competitive.

The norms are expected to help reduce regulatory fragmentation at the state level, and foster a more stable business environment, the industry said in one voice as it described the regulations as "watershed moment", "game-changer" and "landmark".

All India Gaming Federation (AIGF) termed it a decisive first step for comprehensive regulation for online gaming, one that will propel the industry to compete globally, while WinZO games said the move "truly brings the dawn of a global gaming industry right here in India".

The government on Thursday released new rules for online gaming that prohibit games involving betting and wagering, and entail an institutional framework of multiple self-regulatory organisations (SROs) to determine permissibility of an online game.

Under the rules, the SROs (three SROs will be notified to begin with) will have to publish a framework to safeguard users against the risk of gaming addiction, financial loss and financial fraud on its website.

The framework should include repeated warning messages at higher frequency beyond a reasonable duration for a gaming session and provision to enable a user to exclude himself upon user-defined limits being reached for time or money spent.

“...we are grateful to MeitY (IT Ministry) for notifying the amendments to regulate online gaming under the Indian Information Technology Act, and acknowledging the long-standing demand of the gamers and the online gaming industry," Roland Landers, CEO, All India Gaming Federation, said.

The government recognised the industry demands and provided light touch, but comprehensive regulations, which will support innovation, boost Create in India and Brand India, and propel India's Techade, Landers said.

According to All India Gaming Federation, the rules will go a long way in promoting consumer interest while helping the industry grow responsibly and transparently, and will also help in curbing the menace of anti-national and illegal offshore gambling sites, which have been proliferating in the last few years.

"We look forward to assisting the industry transition to the self-regulatory model envisioned under the rules and use learnings from the years of work that has been undertaken at the All India Skill Games Council (AIGSC), the oldest and largest voluntary self-regulatory body for online gaming," Landers said.

The government maintained "a very open and transparent approach" throughout this process and heard various stakeholders across the online gaming eco-system since May 2022, AIGF said pledging its support to the government in making online gaming a cornerstone of $1 trillion (nearly Rs. 81,86,175) digital Indian economy.

Mobile Premier League (MPL) described the release of the new online gaming rules as a watershed moment for the industry "as it recognises online gaming intermediaries and distinguishes them from gambling".

"The rules will go a long way in helping us realise our PM's vision for India to become a global leader in gaming and also contribute to the continued success of Brand India and Create in India," Sai Srinivas, CEO and Co-Founder of MPL, said.

The uniform legal framework provided by these rules will boost investor confidence.

"We anticipate that this will also help reduce regulatory fragmentation at the state level as also mentioned by the Hon'ble Minister, create a more stable business environment and weed out gambling platforms," MPL's Srinivas said.

He said that with the transition to the self-regulatory model that will be recognised by MeitY, MPL looks forward to working collaboratively with industry peers and other stakeholders.

"We believe that this effort will help to create a sustainable and thriving gaming ecosystem in India," Srinivas said.

Paavan Nanda, Co-Founder of WinZO games, said the central, light-touch regulatory mechanism, is a game-changer for the world's largest gaming market, India.

"The overall recognition of Online Games of Skill by way of inclusion as the third form of intermediary after Social Media, and content-related publishers/OTT players, is beneficial for GST differentiation from gambling, providing the required stability of regulation, and facilitating a level playing field for all games of skill," Nanda said.

WinZO games praised the Center for taking very strong measures to protect Indian Consumers from illegal offshore betting and gambling under these provisions.

"The draft empowers the Government, via MeitY, to take the necessary steps to determine if an online platform is a gaming platform or a betting platform and accordingly initiate immediate action against betting platforms particularly the offshore betting platforms under section 69(a) of the IT Act," said Nanda of WinZO games.

This is very positive news for both the industry and the end consumer, creating a safe and accountable internet.

Nitish Mittersain, Founder and CEO of Nazara Technologies, said the rules notified are landmark steps that will immensely help the gaming industry and provide lot of clarity on the sector.

Ranjana Adhikari, Partner at IndusLaw, said that the online gaming rules are a positive step in the right direction and put the central government in the driver's seat for online gaming regulation.

"The light-touch approach and the self-regulatory mechanism proposed by the central government is progressive and keeps the law nimble for a fast-paced and evolving industry," as per IndusLaw.

Malay Kumar Shukla, Secretary, e-Gaming Federation, said the rules will play a pivotal role in bringing transparency, ensuring player protection, attracting investment, boosting investor confidence, and creating job opportunities.

"We are grateful to the government for recognising the sector's long-standing need of bringing about regulatory clarity by prioritising and notifying the regulations," Shukla said.

The broad guidelines regarding betting and wagering will safeguard players and industry at large by distinguishing legitimate skill gaming operators from illegitimate and unauthorised betting and gambling operators. 


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