Govt rejects SROs, to form own regulator for online gaming: Indian Express Report

Published on:

The Indian government is set to take charge as the primary regulator for the online gaming industry, discarding plans for an industry-led self-regulatory organization (SRO). Indian Express reported that the officials from the Ministry of Electronics and Information Technology (MeitY) announced that they will develop a framework for authorizing and certifying online games involving monetary transactions.

Initially, MeitY had proposed the formation of an SRO and invited proposals from the industry. However, officials expressed concerns that the received proposals were predominantly influenced by gaming companies and their associations, lacking the neutrality required for effective regulation.

Under the existing IT rules, online games involving real money require approval from a regulatory body. Those games not involving real money do not need such approval. The government introduced online gaming rules on April 6, 2023, granting a three-month window for the industry to propose SROs. The plan was to establish three SROs. However, Minister of State for Electronics and IT, Rajeev Chandrasekhar, stated that the received SRO applications were too industry-centric and were consequently rejected.

Chandrasekhar emphasized the government’s stance against industry-controlled SROs, highlighting the need for a broader representation. In the absence of suitable SRO proposals, the government will continue to oversee regulation in the sector. While details of the upcoming regulatory framework were not disclosed by Chandrasekhar, it was anticipated that besides online gaming experts, the SROs would include professionals from education, psychology, child rights protection, and information technology.

Officials disclosed that the government reviewed proposals from various entities, including the All India Gaming Federation (AIGF), Esports Players Welfare Association (EPWA), All India Gaming Regulator (AIGR) Foundation, and a consortium of the E-Gaming Federation (EGF) and the Federation of Indian Fantasy Sports (FIFS). However, none of the submissions met the required standards.

Recently, the government formed a group of ministers to deliberate on the regulatory framework for the gaming industry. However, a definitive regulatory structure is expected to materialize only after the general elections. Companies like Dream Sports and Games 24×7, along with industry associations, have sought clarity from the government regarding various aspects, including the implementation of notified rules, responsible gaming frameworks, player protection, financial integrity, and gaming certifications. These aspects are expected to be defined by the regulator, which the industry has likened to a Sebi-like entity.