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Online Gaming: States to police gaming; Centre to frame rules

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State governments will be tasked with overseeing law and order issues related to online gaming within their jurisdictions, even as the Union government defines the overarching regulations for the industry, people in the know told ET.

The legal framework, which will provide “light touch” regulation of gaming intermediaries, will also require them to appoint grievance redressal executives and nodal contact executives who can deal with law enforcement agencies, they added.

The new rules are likely to be introduced for public consultation “as soon as mid-January,” officials from the ministry of electronics and information technology (MeitY) said.

Penal Provisions

“The industry is still in its infancy. Rules must be made in a way that the compliance burden is as less as possible on smaller players and newer entrants,” noted a senior official. “There are only some aspects — such as the legality of content, service and excessive violence in games — which will be carefully monitored.”

The Centre is also likely to suggest that states not ban online games outright but, instead, “penalise them” only in cases of serious lapses.

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“We are looking to drop criminal and strict penal provisions so the industry is able to innovate and move ahead without any fear. Of course, proper guardrails will always be there,” according to officials cited above, who said, “These will initially be our suggestion to the states.”
The upcoming rules are likely to be similar to the Intermediary Guidelines and Digital Media Ethics Code that was introduced in 2021 and reworked earlier this year.

Maintaining Scrutiny


Gaming companies will also be asked to enforce strict know-your-customer norms — establishing the correct age of players’ by verifying it with a government-issued identity card. Gaming intermediaries will also be required to conduct additional scrutiny of methods used to purchase in-game add-ons.

For instance, if a credit or debit card is repeatedly used to purchase in-game additions or buy additional playing time, gaming companies can analyse these patterns to establish the probable age of the buyer, or if the card is being misused by a minor.

“Those aspects can be looked into. Of course, we will need to have more than adequate consultation on these issues,” officials said.

In August, ET reported that an inter-ministerial group tasked with drawing up a framework to regulate online gaming had
suggested introducing daily and caps on the amount of money individual players spend in a game.

However, gaming companies are contending that the “level of expenditure” could vary from person to person. They also have inbuilt systems that follow the pattern of gaming and ask players’ beforehand about the maximum amount they would want to spend per day or per session.

“But there are no checks and balances in place to ascertain the maximum amount that can be spent. That will have to be looked at as well,” a second official said.

The seven-member inter-ministerial task force, which was set up in May, includes members from the Niti Aayog, secretaries from the ministry of home affairs, Department of Revenue, Department for Promotion of Industry and Internal Trade, ministry of information and broadcasting as well as the MeitY secretary.

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State governments will be tasked with overseeing law and order issues related to online gaming within their jurisdictions, even as the Union government defines the overarching regulations for the industry, people in the know told ET.

The legal framework, which will provide “light touch” regulation of gaming intermediaries, will also require them to appoint grievance redressal executives and nodal contact executives who can deal with law enforcement agencies, they added.

The new rules are likely to be introduced for public consultation “as soon as mid-January,” officials from the ministry of electronics and information technology (MeitY) said.

Penal Provisions

“The industry is still in its infancy. Rules must be made in a way that the compliance burden is as less as possible on smaller players and newer entrants,” noted a senior official. “There are only some aspects — such as the legality of content, service and excessive violence in games — which will be carefully monitored.”

The Centre is also likely to suggest that states not ban online games outright but, instead, “penalise them” only in cases of serious lapses.

Discover the stories of your interest



“We are looking to drop criminal and strict penal provisions so the industry is able to innovate and move ahead without any fear. Of course, proper guardrails will always be there,” according to officials cited above, who said, “These will initially be our suggestion to the states.”
The upcoming rules are likely to be similar to the Intermediary Guidelines and Digital Media Ethics Code that was introduced in 2021 and reworked earlier this year.

Maintaining Scrutiny


Gaming companies will also be asked to enforce strict know-your-customer norms — establishing the correct age of players’ by verifying it with a government-issued identity card. Gaming intermediaries will also be required to conduct additional scrutiny of methods used to purchase in-game add-ons.

For instance, if a credit or debit card is repeatedly used to purchase in-game additions or buy additional playing time, gaming companies can analyse these patterns to establish the probable age of the buyer, or if the card is being misused by a minor.

“Those aspects can be looked into. Of course, we will need to have more than adequate consultation on these issues,” officials said.

In August, ET reported that an inter-ministerial group tasked with drawing up a framework to regulate online gaming had
suggested introducing daily and caps on the amount of money individual players spend in a game.

However, gaming companies are contending that the “level of expenditure” could vary from person to person. They also have inbuilt systems that follow the pattern of gaming and ask players’ beforehand about the maximum amount they would want to spend per day or per session.

“But there are no checks and balances in place to ascertain the maximum amount that can be spent. That will have to be looked at as well,” a second official said.

The seven-member inter-ministerial task force, which was set up in May, includes members from the Niti Aayog, secretaries from the ministry of home affairs, Department of Revenue, Department for Promotion of Industry and Internal Trade, ministry of information and broadcasting as well as the MeitY secretary.

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