The draft IT Rules for online gambling, according to the Internet and Mobile Association of India (IAMAI), is “right on intention but poor on scoping.”
The industry body stated that while the proposed rules are a “very positive development” for the ecosystem of the online gaming industry for three reasons, including establishing a legal framework for the industry’s orderly and accelerated growth, the “scoping of the rules has been done poorly” and some aspects need a “major re-look.”
“Here, the members of the association feel that the definition of online gaming is too broad and vague and would unnecessarily bring under regulation and expensive compliance a set of firms that do not need to be regulated or need to be very lightly regulated,” said IAMAI in their statement according to OutlookIndia.
IAMAI believes that intermediaries should not be required to determine and confirm the registration of online games. It stated that some elements of the draft seem to imply that service providers or partners that market, publish, or online host games will have to comply with the rules by validating each game with the self-regulatory body (SRB) on an ongoing basis, “making it impractical.”
“Most importantly, the scoping of the SRB is not strong enough – the industry has asked for a retired Judge since ultimately the role of the SRB would be adjudication, and the industry has asked for common principles by which gaming SRBs are governed,” IAMAI said.
“These measures, by bringing in recognition and regulatory certainty, will allow for innovations and investments in the industry,” they added.
The Ministry for Electronics and Information Technology (MeitY) released the draft online gaming rules on 2 January 2023. The draft rules laid a set of rules for online gaming intermediaries, including establishing a self-regulatory body (SRB) and mandatory know-your-customer (KYC) norms for verification, along with observing the due diligence required under the rules while discharging its duties.
The proposed guidelines also define an “online game” as one made available online and that a user can access using a computer resource if they deposit hopes of winning money. The rules are anticipated to be completed soon.