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Legal Matters | Ban on activities deemed undesirable is lazy legislation. Governments must do better

Banning, as has been seen repeatedly in the past, will only take an activity underground — often leaving victims unprotected 

November 11, 2021 / 05:55 PM IST
Representative image

Representative image

In the 2020-21 season, 10 out of the 20 football clubs in the English Premier League (EPL) were sponsored by a gambling/betting company. This same year, Dream11, a fantasy gaming company, became the title sponsors of the Indian Premier League (IPL), arguably the hottest cricketing property. MPL, another such company, sponsors the Kolkata Knight Riders, while WazirX, a cryptocurrency exchange, sponsored the recent India-Sri Lanka cricket series.

For nascent business-models, the exposure helps. CoinSwitch Kuber, another cryptocurrency platform, claims that its subscriber base grew 3.5x after its IPL ad-blitz.

The government, of course, would have none of that. Over the past year, several states, such as Tamil Nadu, and Karnataka, have banned online gaming, imposing huge penalties; so much so that Dream11 chose to geo-fence its product so that a person in Karnataka could not legally access it. In Tamil Nadu, the Madras High Court overturned the ban, while the Karnataka ban is currently under challenge at the Karnataka High Court.

The benefits and harms of both cryptocurrencies and gambling, to name just a few ‘vices’, ought to be debated. But a more pertinent question is: Is the government’s all-or-nothing approach — wherein it imposes an outright ban on something it deems undesirable, an acceptable, or even appropriate, solution?

Take cryptocurrencies, for instance. Few years ago, as cryptocurrencies started proliferating, the State used its muscle to ensure that banks could not deal with any person who traded in cryptocurrencies. That was a sure-shot way of ensuring that crypto-transactions stayed out of the formal banking channel. The ban was overturned by the Supreme Court, and after much heaving and sighing, the government is said to be considering a legislation with watered down provisions that would enable these to be traded as asset classes (a la art, or commodities), rather than as currencies.

Close

It is not that cryptocurrencies are not being misused. In fact, there has been evidence for some while that the surge in Bitcoin prices have been used to collect money from unsuspecting investors with the promise of a get-rich-quick scheme. But the solution to such a menace (given the entire offence — deceitful inducement of property, cheating, and so on — happens offline) still remains with law enforcement through traditional criminal law. Banning, as has been seen repeatedly in the past, will only take an activity underground — often leaving victims unprotected. In any case, the proposed punishments were disproportionate, and a prime example of lazy legislation.

The case of gaming companies is more complicated. In states where bans have been legislated, they have been apparently necessitated by reports of suicides by people who’ve gambled their money away. Gambling being ‘addictive in nature’ like narcotics, the governments get an almost free pass to categorise it as objectionable, and legislate bans.

It is useful to examine the approach of the United Kingdom, which has legalised gambling through the UK Gambling Act, 2005; albeit with regulatory protection (such as a recent ban on gambling with credit cards). The Gambling Commission conducts quarterly surveys, the latest of which estimates that about 0.4 percent of the gamblers are problem gamblers, while about 0.7 percent are in moderate risk category. For an industry that 54 percent of the adult population participates in, yields profits of £14 billion, and nets the government £3 billion in revenue, the government deems it more prudent to focus on those at risk rather than an outright ban. (The detailed questionnaire for the survey and methodology is also available for public understanding on the web-page).

In fact, this ought to be a template for governments legislating to restrict any activity.

For instance, cannabis, while being a narcotic, is very rarely tied to serious harm. In fact a large number of cannabis users (India is estimated to have about 30 million users) consume it recreationally, without necessarily being addicted to it. You could argue it isn’t healthy, but that is an argument you could make for a wide spectrum of perfectly legal businesses.

Nevertheless, there is evidence to suggest that police disproportionately target marijuana users possessing miniscule quantities, often from poor backgrounds, and cannot afford legal support. If courts objectively examined whether a marijuana ban was, in fact, necessary, and whether there could be other less disruptive solutions, we can perhaps escape the farce of a supposedly prohibited activity, which is commonly indulged in, and at times, even encouraged by the guardians of our public morality.

Similarly, a large percentage of online gamers in India engage in the activity as recreation. There is no reason to deprive them of their enjoyment. Companies could be compelled to impose limits on exposure, or losses over a period. After all, if activities were banned purely due to the harm it causes to a small proportion of its consumers, then most of what we cherish would be gone from our lives: social media and sugar, to name just two.

Abraham C Mathews is an advocate based in Delhi. Twitter: @ebbruz. 

Views are personal and do not represent the stand of this publication.
Abraham C Mathews is an advocate based in Delhi. Twitter: @ebbruz. Views are personal.
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