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The Promotion and Regulation of Online Gaming Bill, 2025

Online Gaming Laws in India: Legal Insights on Gaming and Gambling Laws for Online Platforms 2024

Therefore, the online gaming platforms that receive and remit international payments must establish these accounts in compliance with FEMA. Moreover, the online gaming platforms will have to ensure compliance with theregulations of the Reserve Bank of India (‘RBI’) pertaining to payment settlement and gateways. Case law has played a pivotal role in shaping the legal landscape for online gaming in India. Several landmark cases have addressed the distinction between games of skill and games of chance, as well as the constitutional validity of state laws regulating online gaming. The varied approaches taken by different states create a complex regulatory environment for online gaming operators, who must navigate a patchwork of laws to ensure compliance. This fragmentation also poses challenges for players, who may find themselves subject to different legal standards depending on their location.

In contrast, Canada generally permits online gambling, but provincial regulations govern the particulars. Consumer protection policies are also vital, requiring operators to implement responsible gambling measures. Operators must clearly communicate terms and conditions and ensure age verification to prevent underage gambling.

This case challenged the constitutionality of the Karnataka Police (Amendment) Act, 2021, which criminalised online games of skill when played for money. The Karnataka High Court struck down the amendment, ruling that it violated the right to equality under Article 14 of the Indian Constitution. The court held mostbet official website that the amendment’s blanket prohibition on all forms of online gaming involving monetary stakes was disproportionate and lacked a rational basis. Mr. Vaishnaw said the Act was a response to complaints from users who had lost thousands of crores on online money games, and that it was not a knee-jerk reaction. He said that there is irrefutable proof that the algorithms of online gaming firms do not allow for any user to emerge as a net winner in the long run.

Consumer Protection Policies

  • Goa and Sikkim are the most liberal, while other states like Tamil Nadu and Andhra Pradesh have recently imposed restrictions.
  • The SC had earlier said that games like Rummy and Fantasy Sports involved a substantial degree of skill and cannot be equated with gambling.
  • In the Indian legal context, the nature of games is primarily determined by whether their outcomes depend on skill or are merely a matter of luck.
  • This becomes especially relevant in the context of various formats and mechanisms pertaining to the operation of such online gaming platforms.

While the Information Technology Act, 2000, provides a general framework for cyber activities, gambling remains a state subject under the Indian Constitution. As a result, every state has the autonomy to frame its own laws concerning gambling, which includes online platforms. The digital revolution has brought a model shift in how people engage with entertainment, particularly through online gaming and gambling platforms. Further, online gaming operators/intermediaries need to implement and comply with the anti-money laundering laws and know your customers (KYC) measures to ensure player identification, transparency in payments, and prevention of money laundering. Online gaming laws in India is characterised by complexity and uncertainty, driven by a mix of outdated laws, state-specific regulations and recent amendments. While the industry presents significant economic opportunities, it also poses challenges in terms of regulation, consumer protection and legal compliance.

Global Influence and India’s Struggle for Uniformity in Gaming and Gambling Laws

The call for a centralized regulatory body gains momentum, as a unified law could provide clarity for operators and better consumer protections. In the context of online gaming platforms, the applicable provisions of FEMA and its allied rules and regulations pertaining to acceptance of deposits from abroad and remittances abroad will have applicability. S.6 of the FEMA empowers RBI to regulate capital account transactions, which would encompass various aspects of online gaming, such as payments, receipts, and foreign investments. Further, compliance with FEM (Deposit) Regulations, 2016, will also have to be ensured, as these govern foreign currency accounts in India.

The bill is expected to have a far-reaching impact on investors, listed companies such as Nazara Technologies, and millions of users engaged in fantasy sports and card-based games. Online social games are categorized as games offered for entertainment, recreation, or skill development purposes without monetary stakes or gambling elements. The Act facilitates their development through registration mechanisms, support platforms, and awareness programs highlighting their positive use for digital literacy and skill development. The Online Gaming Bill has been the subject of much debate in India’s parliamentary corridors in recent times. With online gaming expanding exceedingly in the country, the government has moved to regulate the industry in order to promote honest play, safeguard consumers, and avoid abuse.

Yes, games that are considered skill-based, such as rummy and poker, are generally legal under India’s Gaming and Gambling Laws. However, individual states may impose their own restrictions, so the legality can vary from one state to another. Under this act, operators of illegal platforms could face imprisonment of up to 5 years, highlighting how robust the legal framework is.

In general, gambling in India is regulated by the Public Gambling Act, 1867, which is a central law that prohibits certain forms of gambling. However, the law does not explicitly mention online gambling since it was enacted long before the advent of the internet. Also, the Act differentiates between games of chance and games of skill as well as declares all types of gambling unlawful in India. Entries 34 and 62 of the State List in the Seventh Schedule of the Constitution places the regulation and taxation of betting and gambling within the jurisdiction of State governments. In 2017, Telangana became the first State to ban all forms of online gaming including skill-based games. In 2020, Andhra Pradesh banned online gambling, and in 2022, Tamil Nadu banned games such as Rummy and Poker.

While digital technology has brought many benefits, these games have exploited loopholes in the law and caused deep social harm. Online platforms dealing with real money operate in an unregulated space, raising concerns about transparency, addiction, and data privacy. A well-regulated market could not only ensure fairness but also offer necessary safeguards for users, especially in light of the rising number of online gaming addicts. India’s fragmented approach to Gaming and Gambling Laws contrasts sharply with other jurisdictions that have adopted centralized regulations.