Framework Of Spending Limits Expected To Be Implemented By MEITY

The online gaming industry is making its presence felt in the Indian market – something that’s only natural given the monstrous size of the market. So much so, there has been an increase in popularity and usage with games with in-game purchases among players.

Traditional gambling games in this country, like Rummy for instance, are now available online, as are daily fantasy games. For quite a while there has been a running battle of sorts in fact between some of the providers of rummy and DFS apps and Google Play regarding the latter’s decision in September 2020 to suspend these apps from its portals because they didn’t follow its gambling policies.

And now, the Indian government is getting into the act as well, by setting up a group to draft a framework that ensures all forms of online gaming that are legal in the country are regulated, thereby guaranteeing protection from financial harm and other issues for all players and consumers.

The group set up by MEITY to draft the regulatory gaming framework

The group that is being set up to draft the regulatory gaming framework to oversee and regulate online gaming activities in the country comprises members from different ministries and has been set up by the Ministry of Electronics and Information Technology (MEITY).

Recently published reports have divulged that the inter-ministerial group is in talks about setting a limit on daily spends by players to safeguard their protection. There has never been a more relevant time for such issues to be addressed. Once customers start depositing money, it becomes more tempting for them to avail of attractive promotional offers like no deposit bonuses. Without certain restrictions being implemented, players may fall into the trap of spending too much money than they should.

The objectives that the group will work with are simple:

• Set up a draft framework that will help regulate online gaming
• Regulate the amount that a player spends – daily or at other periodic intervals – on in-game purchases

There are 7 members in this inter-ministerial group that was set up in May 2022, and they include, besides the MEITY secretary, secretaries and members from the following governmental sectors:

• The Ministry of Home Affairs
• The Ministry of Information and Broadcasting
• The Department of Revenue
• The Department for the Promotion of Industry and Internal Trade
• NITI Ayog

Timeline and suggestions for draft regulation

As with all such endeavors, one of the primary and most important action items is to set up a timeline for implementation of said framework. Thankfully, there is a timeline in place – a report carried by one of the premier newspapers of the country, The Economic Times, suggested finalization of these draft regulations could be achieved as early as October 2022.

Once the draft regulations are finalized, the next step would be to open them up for public review and consultation. Recommendations made by the group so far include a suggestion earlier this month asking MEITY to amend the Information Technology (IT) Act of 2000 and bring gaming into its ambit by putting in rules for this rapidly burgeoning sector, according to a government source for the newspaper.

The government has already asked the gaming sector to introduce rules for itself, by putting together a Self-Regulatory Organization (SRO) to oversee and adjudicate the different issues and segments associated with online gaming. This request is not new – the MEITY has already rejected 2 proposals for setting up of an SRO and recommended revisiting some of the clauses in it.

Why an SRO?

One question immediately arises out of this scenario – what is the need for an SRO in the current scheme of things? To put it succinctly, it is important to have concrete regulations in place to avoid loss and harm to players.

Gaming is not really a homogenous group, and in this day and age, companies are predominantly led by youths who have a flair for innovation. Moreover, as time passes, it is becoming clearer and more evident that concrete regulations need to be put in place. Fortunately, the government was willing to help out by putting together an SRO.

What would an SRO look like and what would be its responsibilities?

At first glance, the SRO would likely consist of an executive body with 5 to 7 members. At the head of the body would be a retired Supreme Court judge. If such a person was not available it could be one of the judges from one of the country’s high courts.

The SRO need not have absolutely outrageous looks and systems; it could in fact be on the lines of the body for all social media intermediaries that the Internet and Mobile Association of India (IAMAI) has recently proposed.

The role of the SRO would mostly be administrative in nature, and there would be an advisory element to it as well. Other responsibilities would include the authority to issue notices to apps to take down specific content that is in violation of stated conventions as and when required, besides being able to take a call whether a specific game involves skill or just plain luck.

Key takeaways

The meeting between the MEITY and gaming platforms saw vast representation – there were representatives from over 40 gaming platforms. All of them had reservations – of some form or the other – about the regulations of varying individual state governments within the country.

For the representatives from the gaming community, like Nazara Technologies, a gaming firm, the owner of the Mobile Premier League (MPL), Galactus Technology Private, and Sporta Technologies, the brains behind Dream 11, the requirement was simple – set up a central regulatory framework that works and is stable as well as predictable.

Another key point that popped out post the meeting between members of these 2 entities was the need for special measures to ensure the safety and protection of women gamers. This is an area that hasn’t been addressed as much as it should have been.