AMID GROWING concerns the current rules lack legal teeth to effectively deal with the online gaming sector, the Centre has initiated a process to review the regulations, specifically to address apprehensions over offshore betting apps masquerading as online games and the potential for money laundering posed by players in the sector.
It is learnt that the fresh attempt is being led by the Union Home Ministry, with an inter-ministerial panel being formed to formulate tighter rules.
The primary contention is understood to arise from the self-regulatory model adopted in the current rules. Introducing tough norms to curb online betting is also a key reason.
In April, the Ministry of Electronics and IT (MeitY) had notified rules for online gaming which allowed for the setting up of self-regulatory bodies to vet the legitimacy of online games, with oversight of the government, among other provisions. These rules were notified after recommendations by an inter-ministerial task force.
An informal inter-ministerial group of ministers (GoM) was formed around three months ago to brainstorm an “all of government” approach to take stock of the online gaming ecosystem. The panel will seek to harmonise current gaming rules in a way that addresses concerns that some ministries have.
The group is learnt to include Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, IT Minister Ashwini Vaishnaw, Minister of State for Electronics and IT Rajeev Chandrasekhar, and Commerce Minister Piyush Goyal, among others. Essentially, while the IT Ministry has so far been the nodal ministry for online gaming, other ministries — primarily Home and Finance — also want to have a say.
For instance, it is understood that the Home Ministry wants to understand how the rules would manage to deter online gambling platforms, while the Finance Ministry wants to share inputs around possible violations of money laundering norms.
Internally, it is understood the Home Ministry wants to take a tough stance on offshore betting platforms and wants this to be reflected in any regulation governing the online gaming sector. The stance on regulating betting platforms was also prompted after the fallout of the Mahadev betting app, which has been at the centre of a major political storm in Chhattisgarh.
“The 28 per cent Goods and Service Tax (GST) action on the online gaming space was the first plan of action on the sector. The rules for online gaming were promulgated a few months before the GST was imposed. But, there is a consensus that the rules need to be stricter, especially to rein in betting sites and to effectively prevent any potential of money laundering,” a senior government official said.
As a result of the conversation around this group, the gaming rules notified by the IT Ministry have taken a back seat given that they are likely to be changed once the GoM formally shares its recommendations. The IT Ministry is yet to accept any proposal to set up self-regulatory bodies despite having received multiple applications. These bodies are unlikely to be formed until the GoM gives its recommendations on how the regulations should change. The group has not officially met yet owing to Assembly elections in various states and is expected to formally meet sometime in the first two weeks of next month, most likely on December 15.
Queries sent to the Home Ministry, Finance Ministry, IT Ministry and Commerce Ministry did not elicit a response until publication. When the IT Ministry had notified the gaming rules, it had made it clear that only those self-regulatory bodies that have no members with a potential conflict of interest because of their relationship with gaming companies will be accepted to operate. However, The Indian Express has learnt that the majority of the applications the ministry received included members who may not be “entirely independent” of gaming companies.
Source from: https://indianexpress.com/article/india/citing-betting-concerns-gom-set-to-tighten-online-gaming-rules-9041327/