DRAFT FOR ONLINE GAMES
1. Context
Recently, the Ministry of Electronics and IT (Meity) released the Draft Rules for Online Gaming. The Proposed rules have been introduced as an amendment to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
2. What do draft rules say?
- Online games will have to register with a self-regulatory body, and only games cleared by the body will be allowed to legally operate in India. Online gaming companies will not be allowed to engage in betting on the outcome of games, the proposed rules say.
- The Proposed Rules include several important recommendations, including the creation of a self-regulatory body, a grievance procedure, and strict know-your-customer standards for verification.
2.1 Self-Regulatory body
They will have a board of directors with five members from diverse fields including online gaming, public policy, IT, Psychology, and medicine. It must make sure that nothing in the registered games is in the interest of the sovereignty and integrity of India, defense of India, security of the state, friendly relations with other nations, or public order, or incites the commission of any cognizable offense related to the aforesaid.
2.2 Registration of online games
Online games must register with a self-regulatory organization, and only those approved by the organization will be permitted to legally function in India.
2.3 Prohibition on betting
According to the proposed regulations, online gaming organizations will not be permitted to place bets on the result of games.
2.4 Compliance officer
Online gaming platforms will also need to appoint a compliance officer to make sure the platform is abiding by the rules, a nodal officer to act as a liaison with the government and help law enforcement agencies, and a grievance officer to handle user complaints.
3. Need for the Rules
- Around 40 to 45 % of the gamers in India are women, and therefore it was all the more important to keep the gaming ecosystem safe.
- It is believed to be a great first step for comprehensive regulation of online gaming and will reduce the state-wide regulatory fragmentation that was a big challenge for the industry.
- The goal is to regulate online gaming platforms as intermediaries and place due diligence requirements on them.
- The proposed rules aim to grow the online gaming sector and encourage innovation.
4. Issues with Online Gaming
- Many social activists, government officials, and those in law enforcement believe that online games like rummy and poker are addictive; and when played with monetary stakes may lead to other issues.
- Some people are losing money and falling into a debt trap. Some of the victims took their own lives.
- The study shows that online games are addictive whether these games involve skill or mere tricks.
- Reportedly, there have been a few instances where youngsters, faced with mounting debts due to losses in online games have committed other crimes like theft and murder.
- Shifting of users to grey or illegal offshore online gaming apps not only results in loss of tax revenue for the State and job opportunities for locals but results in users being unable to avail remedies for any unfair behavior or refusal to pay out winnings.
5. Online gaming sector in India
- The revenue of the Indian mobile gaming industry is expected to reach USD 5 billion in 2025.
- The industry grew at a compound annual growth rate (CAGR) of 38% in India between 2017-2020, as opposed to 8% in China and 10% in the US.
- It is expected to grow at a CAGR of 15% to reach Rs 153 billion in revenue by 2024, as per a report by VC firm Sequoia and management consulting company BCG.
For Prelims & Mains
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For Prelims: Ministry of Electronics and IT (Meity), Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
For Mains: 1. What are the draft rules for Online Gaming in India and explain why the rules are needed to regulate online gaming in India.
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Source: The Indian Express
