The notification of the amendments to online gaming rules included the plan to establish self-regulatory bodies (SRBs) by July of this year. However, they are yet to be formed and the online gaming companies are hopeful to get clarity on the situation soon.
Interestingly, the Centre is re-evaluating its plan of notifying SRBs for the time being. On the other hand, the industry is now proposing a three-tier regulatory mechanism to put the SRBs under an oversight committee which would be formed by the government, said Dream11 cofounder and CEO Harsh Jain and Games24x7 cofounder and CEO Trivikraman Thampy as per The Economic Times.
“The way SEBI (Securities and Exchange Board of India) unlocked the financial potential of the country through the stock market, that’s the kind of regulation we need,” said Jain. He explained that having a SEBI-like regulator would benefit the entire online gaming industry.
“The government has proposed an SRB for the gaming industry, but there can be a three-tier structure with government oversight, where it’s not just an independent SRB. This is a tried and tested model where you have a three-tier structure that can regulate gaming,” he added.
The major concern of the government is that the people operating the SRBs may have an influence over the online gaming industry, which can lead to unfair judgement on occasions that will defeat the purpose of having SRBs in the first place.
Due to this, the government refrained from notifying any SRB even after the submissions were made and put their plans on hold.
Speaking on the situation, Thampy said, “We’d like the SRBs to be notified, but it’s not as if the government’s concerns are misplaced. Their concerns are around whether the operators are controlling the SRBs. Obviously, the way the rules were set up, an SRB needs to have an independent board of directors.”
“So whether it is about having another tier above that in the form of an oversight committee or a government regulatory body, we are very open-minded in terms of the regulatory structure that the government believes is right,” he added.
The online gaming industry is growing at a rapid pace with many new entrants, including several bad actors. Thampy insisted that appropriate measures are a necessity. A special GoM, led by home minister Amit Shah, has also been formed that is expected to deliberate on the situation on December 15.