Dr. Pradeep Mahapatra
Ministry of Electronics and Information Technology (IT), Government of India released a draft online gaming policy on January 02, 2023. It is scheduled to be carried out through amendments to the IT (Intermediary Guidelines & Digital Media Ethics Code) Rules, 2021. Prior to the move, the central government designated the Ministry of IT as the nodal agency for online gaming through a gazette notification on December 26, 2022. The ministry moved swiftly in the framing of a policy and placed in public domain for consultation. Efforts were made to finalize the rules by early February 2023.
Keeping pace with the international trend, the online gaming industry in India is fast-moving. As per market research and consulting firm KPMG data, the number of total consumers of online gaming calculated to 36 crores 50 lakh players by 2020. While revenue stood at 15 thousand crores, it was predicted to be doubled by 2026. The fact that online gaming move towards gambling caused concern for the government. Some states enacted laws to prevent e-game gambling, but the lack of clear policy at the federal level raised legal battles on government directions.
It is noteworthy that about 60 percent of e-game players fall below the age group of 25 years and about 40 to 45 percent are women. Active engagement of children, teenagers, youth and women with e-game caused safety concerns for the administration. The proposed draft amendment continues to give importance to the earlier practice of Self-Regulatory Organization (SRO) among e-gaming stakeholders. The SROs take the responsibility of framing minor details on the charter of rules and regulations and administer such modalities deemed fit among their member e-game operators. All the e-games have to procure clearance from SRO before publication and the certificates are to be clearly displayed in the beginning profile pages.
A five-member ‘board of directors to be constituted comprising representation from online gaming, public policy, IT, psychology and medicine for the management of each of the SROs. One of the directors to every SRO will be nominated by the government. The certification for publication will ensure the sovereignty, integrity and security of the country, friendly relations with foreign nations and public order etc.
Intermediary play an important role in availing the e-gaming facilities to the consumers. Like e-game publishers, intermediary platforms also need to take membership of SROs and abide provisions laid down by them. Further, intermediaries will collect know-your-customer data. They will make arrangements for an instant grievance redressal system, and employ a grievance officer and a chief compliance officer as per provisions laid down in ‘IT (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021’. All the intermediary platforms to have a physical office and address in India.
Traditionally, gambling on e-game platforms remained under the preview of state governments. However, after transferring e-gaming to IT ministry and within a time period of a week publication of draft amendment to existing rules to include new provisions for control of e-gaming, conflict between the state and central government appeared inevitable. Few state governments including Kerala, Karnataka, Tamil Nadu, Telengana, Andhra Pradesh, Odisha and Assam enacted laws to stop gambling online. On the other hand, the state governments of Sikim, Meghalaya, Nagaland, Goa, Daman preferred earning revenue from allowing gambling online. E-gaming industry initiated legal battle against banning gambling in digital platforms at high courts of Kerala, Karnataka and Tamil Nadu. In such a situation, draft amendments to IT rule banning gambling are poised to create a new chapter.
Under constitutional provisions, gambling is a state subject. On the other hand, internet administration comes under the central government. The question arises whether the central government can stop online gambling through e-gaming. Similarly, even though state governments control gambling, can they confine the gambling activities limiting to a particular geography? On the occasion of release of draft online gaming policy, Union Minister of State for IT Rajeev Chandra Sekhar said in a press conference, “Any game that allows for or permits wagering on its outcome will not be permitted.” He further added, “The states can do whatever they want vis-à-vis gambling. Our duty is to regulate the internet. We are not stepping into regulatory physical gaming, gambling or betting. We are interested in growing the online gaming ecosystem.”
The draft online gaming policy under proposed amendments to the rules brings under its preview any online game where a user makes a deposit in cash or in-kind to participate in an online game. Casual games such as Candy Crush do not subscribe to the definition. Online gaming stakeholders-sponsored SROs will ensure that all the registered e-games under their control do not involve in gambling activities. The ministry will enjoy the power to bring into the fold of the rules any e-game it deems necessary. The government will keep an eye on such e-games which are harmful to children or create disturbance in social life.
The proposed amendments do not mention any change in the digital media ethics code of the IT Rules 2021. It denotes that all the rules prescribed to online platforms will be applicable to the online gaming industry on ethics front. Previous notifications restricted the publication of surrogate advertising of e-games. The draft amendments have not spelled out any monetary fines for contravention of rules for the intermediary. However, such act may result in losing the benefits granted under Section 79(2) of IT Act 2000 that proclaims an intermediary shall not be liable for any third-party information, data, or communication link made available or hosted by him. In totality, the proposed draft online gaming policy aims to bring online gaming into conformity with Indian laws, stop gambling and strengthen control of the central government in the field.
(English translation of the original Odia newsletter by the author circulated on January 6, 2023. https://tinyletter.com/pradeepmahapatra/letters/message-283 . It is an open-access content, free for translation and reproduction)
Dr. Pradeep Mahapatra is a retired faculty of Journalism, Berhampur University, Odisha.https://about.me/pradeepmahapatra
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