A Legal Game of Hide And Seek

As unclear laws and lack of regulation continue to disturb the RMG’s promising potential, we take a look at what the country seeks to gain if the legal doors for real money gaming swing open.

Alot has been talked about when it comes to having stringent laws on gambling and betting, but having one wholesome regulatory framework made for gaming isn’t something that has been actively considered in India. One of the significant reasons why as soon as an online game gets its share of popularity among the masses, a call for regularising, censoring and monitoring and, in extreme cases, ban, get filed in Indian courts.

Biggest examples were the ban of PUBG under Section 144 of the Criminal Procedure Code, 1973 and the cry to ban Pokemon Go. In an article ‘Online Gaming, Gaming Laws & Legal Puzzles In India’ by CS S. Ravishankar Company Secretary in Practice, Partner – ASR & CO, he happens to give a quick walkthrough of the uproar that Pokemon Go, which was not even officially launched in India, caused. He quickly detailed the consequences that followed due to the absence of regulations on online gaming. Owing to the download of unauthorised versions of the app, some of these apps are not bound by the law!

In fact, unlike a temporary suspension of the game’s servers or a restriction of access to it, the ban does little to truly alleviate the problem. On the contrary, the negative attention that PUBG receives is simply increasing its appeal and causing more curiosity about what makes it so offensive. Instead of turning to drastic measures, proper regulatory standards must be investigated and implemented.

Gaming laws in India

India does not have a unified gaming or gambling law (these two terms are used interchangeably, keeping in mind the Indian law judiciary). Gambling is a taboo topic in India so many, states are not comfortable with the idea of it being legalised in the country.

Due to this reason, some states such as Telangana, Gujarat, and Andhra Pradesh have banned all forms of gambling completely. Sameer Barde, CEO of The Online Rummy Federation (TORF), commented, “There is a need to have a licensing body which will put down processes for companies to obtain a license to run an online rummy platform which will weed out non-eligible players right at the beginning.” If proper regulations are put in place, the process will prevent or penalise illegal operators in the country. Moreover, this will also protect and safeguard players. There are self-regulatory bodies like (TORF) and the (AIGF) trying their best to regulate the industry. However, regulations set by the government would be even more effective in creating a safer gaming environment that also benefits the economy. States like Goa and Sikkim have legalised and regularised casino-based gambling. This has helped the industry flourish and helped the states boost their economy through the revenue and employment generated by this decision.

Other regions like Maharashtra and West Bengal have permitted real money skill games like poker and rummy while banning games of chance, which is a stand taken by the rest of the states in the country.

The uneven gaming laws and absence of a regulatory body also

By Donna Amo

Manav Sethi, Chief Marketing Officer, Octro Inc

hampers the immense growth of online gaming in the country when contributing to India’s economic prosperity.

The ‘foreign’ laws

Countries like the United Kingdom (UK), USA, China, Australia, Ireland, Finland, Canada, and New Zealand have legalised, and regulated gambling activities and have also experienced its benefits.

In the UK, gambling has been a recreational activity for centuries, with the earliest recorded horse race betting dating back to 1539. The Betting and Gaming Act of 1960, passed by the British Parliament, legalised additional forms of gambling but was a little restrictive. However, with the Gambling Act of 2005 being passed, UK is one of the countries with a well-regulated framework for the gambling industry. The current gambling act was designed to curb illegal gambling in the country, with regulations to make it safer for people to gamble.

Not only has regulation protected players in the industry, but it has also benefited the county’s economy. As per an EY report, the British gambling industry contributed £7.7 billion to the country’s economy in 2019. Commenting on whether tightening gambling laws in the UK would prove beneficial or not, Michael Dugher, CEO of the Betting and Gaming Council, said, “If people were restricted from betting in the regulated industry, they would simply migrate to the growing unlicensed, unsafe black market that employs no one, pays no tax and contributes nothing to UK plc.” A valid point!

The United States of America (US) is another country with regulated gambling industry. Earlier, gambling was illegal in almost every US state except for Nevada and New Jersey. In recent years, other US states have started legalising certain types of gambling like casinos, horse race betting, etc., while different types like online gambling are still illegal. However, even with these restrictions, the US online gambling market was valued at $1,978.57 million in 2020 (Global News Wire). This indicates that a clear legal and regulatory framework for online gaming is possible, safer and more beneficial.

China has mostly banned gambling in all parts of its vast country except one. Macau is a region in Hong Kong and the only place where casinos are legal in the country. Gambling has been legal in Macau since the 1850s as an attempt by the Portuguese government to generate revenue. Since then, the gambling industry in Macau has skyrocketed, resulting it being called the ‘Monte Carlo of the East. In 2019, the income earned from the gaming and gambling industry was more than $29 billion. In the case of Macau, legalised and regulated gambling has done what it was called to do, which was to bring in revenue. Manav Sethi, Chief Marketing Officer of Octro Inc, said, “With the largest youth population globally, India will soon become one of the world’s leading markets for gaming. The gaming industry is going through a ‘Boom’ period, resulting in game developers and platforms ramping up their hiring efforts. When the sector goes through a period of rapid growth, it undergoes a cyclical effect beginning with investors (both domestic and foreign) who want to invest in the space, leading to a flurry of employment opportunities across the board. These opportunities could range from designers, developers, animators, sound and audio engineers, gaming critics and testers, just to name a few.”

Are the obscure gaming laws of India potentially blocking the development of this vertical when it needs it the most? Here, the decision of the Madras High Court is significant because it is slowly directing the path of the future of online gaming in India. Whether that path will lead to a complete reformation of the gaming laws, we will have to wait and watch.

Michael Dugher, CEO, Betting and Gaming Council, UK