Old game, new rules: Government taskforce to set spend limits for online gaming

In an effort to ensure "consumer and gamer protection" an inter-ministerial group has been created to create regulations for the amount of money individuals can spend while engaging in online gaming. The task-force has been set-up by the Ministry of Electronics and Information Technology (Meity), sources privy to the matter told the Economic Times.

The seven member taskforce has members from various ministries such as the Niti Aayog, as well as secretaries of the Ministry of Home Affairs, the Department of Revenue, Department for Promotion of Industry and Internal Trade, the Ministry of Information and Broadcasting as well as
the Meity secretary. According to the report by Economic Times the draft regulations will be finalised over the next month.

The taskforce has suggested an amendment to the Information Technology Act of 2000 to have rules which will help regulate the gaming sector. An official present at the meeting told ET that the rules will be introduced in a manner similar to the  Intermediary Guidelines and Digital Media Ethics Code introduced in 2021.

Also read: Explained: Why government has proposed amendments to the IT Rules 2021

“The Rules for Gaming under the IT Act will also contain the clauses on self-regulation,” sources privy to the matter noted that the gaming sector needs a self-regulatory organisation ( SRO) to look into and adjudicate various aspects related to online gaming.

Also read : Why Online Fantasy Sports badly needs a clear, singular policy

“Gaming is not really a homogeneous group. Gaming companies are almost always (led by) young innovators. But that does not mean that for the next five years the industry will work solely on trust, hope and chance. There need to be concrete regulations,” an official said, emphasising the need for concrete regulations.

“The government is happy to support an industry led SRO. But it should not be a toothless body,” the official added, expressing the government's intention for an industry-led SRO.

The first two proposals for an SRO have faced rejection from the Meity, wherein industry representatives have been asked to rework the clauses, a senior government official disclosed.

Officials also mentioned that the model for the self-regulatory body being proposed by the Internet and Mobile Association of India (IAMAID) for social media intermediaries could be adopted.

Also read: Industry group proposes self-regulatory grievance redressal board for social media firms

Officials told the Economic Times that the SRO which is likely to be a five to seven member body is likely to comprise of central government's representatives, industry members  as well as technical experts from various fields such as law or human rights among others.

According to a report by Moneycontrol, a meeting was held earlier this year in June where representatives from the gaming sector were asked to to draw up comprehensive policies on various aspects including an objective definition of games of skill and chance. The meeting happened at a time when the gaming segment has minted two startup unicorns (companies with more than $1 billion valuation) in the past year - MPL and Games24x7. Dream11 parent Dream Sports became the first unicorn in the space in 2019.