New Regulations for Online Gaming Companies:

• The updated Information Technology Rules prohibit offshore betting advertisements and restrict gaming companies from endorsing gambling.
• The online gaming industry has encountered challenges in regulating online gambling and fact-checking processes.
• These amendments are designed to assist India in reaching its objective of becoming a one trillion-dollar digital economy by the fiscal year 2025-26.

What do the new IT rules entail for online gaming companies in India?

• The Indian government unveiled the initial version of the rules in January 2021 and collaborated with the industry to refine them.
• The final version mandates online platforms to prevent the dissemination of misleading or false information.
• Online gaming companies are required to serve as digital intermediaries, scrutinize games and users, eliminate false information, and abide by self-regulatory body guidelines.
• The new regulations also forbid offshore betting advertisements and bar gaming companies from promoting gambling.
• Platforms are required to inform users about rules, privacy policies, terms of service, and user agreements, including KYC procedures and deposit protection measures. Rule 4A illustrates the online real-money game verification process.
• The government hopes these amendments will assist India in achieving its objective of becoming a one trillion-dollar digital economy by the fiscal year 2025-26.

What are these self-regulatory bodies and who can join them?

• The government will select three self-regulatory bodies to establish rules for the online gaming industry.
• Trusts and for-profit organizations are not eligible to apply, and specific criteria are in place for members who can join these bodies.
• Existing industry groups will not qualify as self-regulatory bodies, and according to an industry expert, it could take up to eight months to establish them.
• The bodies must be registered under the Companies Act, include members from the gaming industry, and have a board of directors without any conflict of interest.
• They must also publish a list of members, frameworks for verifying online real-money games, and a grievance redressal framework, along with the contact information of a grievance officer.
• They are required to update the list of permitted online real-money games and provide details about the applicant and the verification validity period.

How will the new rules affect the online gaming industry in India?

• The new rules encourage gaming companies to act more responsibly and promote responsible gaming behavior.
• Gaming companies must display a verification mark from an online gaming self-regulatory body to indicate that the game has been verified, and games that have not been verified cannot be advertised.
• Although gaming companies receive intermediary protections under Section 79 of the IT Act, online gambling is still not considered legal.
• The regulation of gambling is the responsibility of individual states, and they have the power to regulate it within their borders.