INTRODUCTION
Since the government of India defines an online game as “a game that is offered on the internet and is accessible by a user through a computer resource or an intermediary,” playing games online is not prohibited in the country. A new paradigm in the gaming industry has been furthered by internet access and the trend of smartphone use in isolated villages.
Due to the “game of skill,” which is permitted in India, online games are played using human intellect, or skill. On the other hand, online games that rely solely on chance and yield outcomes determined by chance rather than human intelligence are considered “games of chance” and are illegal in India. This is the rationale behind Indian law’s prohibition on gaming and betting.
After examining the gaps in state laws regarding online gaming, the Ministry of Electronics and IT announced new rules in April 2023 to shield users from harmful content and addiction.
These regulations are added to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (“IT Rules”). It will primarily examine real money online gaming.
ANALYSIS OF AMENDMENT
India amended the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (“Intermediary Rules”) on April 6, 2023, establishing a new legal framework for online game operators. These amendments are known as “Gaming Amendments.”
The Ministry of Electronics and Information Technology (“MEITY”) proposed new co-regulatory rules for online gaming intermediaries (“OGI”) through proposed amendments (“Draft Rules”) to the Intermediary Rules, which marked the beginning of the path towards the introduction of the Gaming Amendments in January 2023.
- The Gaming Amendments contain definitions for all games that are offered online, in contrast to the Draft Rules, which by definition concentrated on real money games. Free-to-play games are generally acceptable, but companies that provide them are referred to as Online Gaming Intermediaries, or “OGIs.” However, the majority of the substantive duties imposed by the Amendments relate to the management of real money games (also known as “Online Real Money Games”), which players can access after making “deposits,” a term that is currently unclear.
- The Gaming Amendments have streamlined the self-regulatory bodies’ (SRBs’) compliance requirements, which is a positive development. For example, the Gaming Amendments require SRBs to only publish a report on their website detailing the list of verified online real money games, period of validity, bases for approval and details of suspension or revocation. Previously, the Draft Rules required SRBs to submit reports to the Central Government on registration of each online game, along with the bases for such registration. The Central Government has the authority to direct OGIs offering Online Real Money Games (“Real Money OGIs”) and intermediaries for users to continue accessing online real money games that were previously registered, which is perhaps another positive step in the event that an SRB’s registration is revoked.
- A much-needed step has been taken: the detailed section on OGI obligations that was previously outlined in the Draft Rules has been removed and combined with the obligations that apply to major social media intermediaries, with additional points denoting the obligations unique to Real Money OGIs. Along with the KYC and user verification requirements, the Real Money OGIs’ improper financing or credit-facilitating of Online Real Money Game players has also been prohibited. Even in comparison to large social media intermediaries, Real Money OGI compliance standards are stricter, requiring users to be informed of changes in terms and to comply with court orders or law enforcement requests.
CONCLUSION
The Gaming Amendments provide a regulatory baseline for an industry long beset by uncertainty, disruption, and unethical behaviour by outliers. They are a positive step in a dynamic field. Therefore, it is commendable that the project was completed in four months, from conception to binding regime.