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Government to Introduce a Central Regulatory Framework for the Online Gaming Industry

CIO Insider Team | Monday, 10 October, 2022
Separator

To bring about uniformity in the way it is regulated in the country, the government is exploring the need for a central regulatory framework for the online gaming industry.

A framework that could entail setting up a separate regulatory body and require compulsory registration of online gaming companies, is now the talk among policymakers. Indicating that the regulator would have the powers to block unregistered platforms and the operators must do user verification through the know-your-customer procedure to protect minor players from exploitation, as per the early discussions.

The Ministry of Electronics and Information Technology, home affairs and finance are the stakeholder ministries who are looking into the pros and cons of the issue and growing concerns around use of these platforms in laundering or tax evasion. Officials from these ministries are expected to meet this week to discuss these issues.

According to reports, online gaming is said to have made a fresh push for a centralized framework, as it is increasingly felt that state-level regulations may not be enough to deal with the issues posed by online gaming and divergence in regulations across states would further complicate the situation.

Word on the street says that it is felt that it may be difficult to block apps or websites at the state level

Under the state list, the betting and gambling are covered, but it is claimed that there is no mention of 'online gaming' in any lists as these were formulated pre-Internet.

Those which have implemented a licensing mechanism for online gaming and gambling include Meghalaya, Sikkim and Nagaland. Others such as Telangana, Andhra Pradesh and Odisha have prohibited both online gaming and online gambling. Tamil Nadu has brought an ordinance to ban online gaming in the state.

States cannot also block access to offshore foreign gambling websites

The Centre has powers to bring in such a framework. Under Article 249 of the Constitution, Parliament can assume legislative authority over a subject on the State List if it has become a subject of 'national interest'.

Word on the street says that it is felt that it may be difficult to block apps or websites at the state level, rendering their bans ineffective, coupled with the issue of dealing more effectively only when complemented with a central framework.

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