Will foreign betting companies dominate the rules of the game?

- Advertisement -

The Center has decided to regulate the online gambling industry in accordance with the way social media platforms are regulated today. The industry in general has welcomed the proposed amendment, which can crack down on new companies abroad. Mint explains how this can work.

What are the changes in the amendment?

The draft notice defines online gambling as any game “that is offered on the Internet and is accessible to a user through a computing resource if they make a deposit with the expectation of winning.” Add the need to create a “self-regulatory organization.” ‘ (SRO), requests any online gaming company in India to appoint a complaints officer, compliance officer and nodal contact person, physical contact address and need to do document verification Meet your client (KYC) of users accessing online gaming platforms The proposal also establishes the need to disclose the risks for users.

How can it affect foreign companies?

So far, foreign gambling companies have not been affected by online gambling rulings in Indian courts, but now they will have to come under the purview of regulations if they want to continue operating in India. Once an organization establishes and registers its office in India, it will be regulated as a private limited company governed by laws including the IT Rules. Furthermore, any foreign-based gambling company will now need to obtain playable titles offered under its platform in order to be licensed by an SRO, which, again, would make it more difficult for the unregulated transmission and operation of said platform in the country.

See full image

Graphic: mint

Do you separate games of skill and chance?

No. The published draft only provides a general definition of online gambling and does not segregate between ‘chance’ and ‘skill’, an extremely important aspect that is currently under consideration by the Supreme Court. The order covers any game that a user plays over the Internet for a fee while hoping to win with it.

How will it affect Indian startups?

Most of the Indian online gaming industry stakeholders said the amendment is a step in the right direction. Local gaming companies had so far raised concerns about state-level bans and heavy taxes that could halt Indian gaming businesses, while allowing foreign companies, which would fall outside the scope of the laws from India, will capture your market share and revenue, without paying anything. tax to the Indian government. Local startups believe the move will help domestic businesses.

Will online gaming be within the purview of the Center?

No. According to lawyers and industry experts, the IT Rules are just a set of rules that provide basic compliance oversight of online gaming service providers, and do not provide an overarching legal framework that clearly defines what is allowed. And why not. that some members of the gaming community have been asking for. States remain free to receive calls about online gaming. New companies will need to ensure they comply with both state regulations and new IT rules, once they are adopted.

See all the news and technology updates on Live Mint. Download The Mint News app for daily market updates and live business news.

more less

- Advertisement -

Related articles