India's leading gaming industry bodies adopt voluntary code of ethics. What you need to know

The voluntary code of ethics was curated by IAMAI and signed by members of AIGF, EGF and FIFS

On December 6, four leading gaming industry bodies in India signed a voluntary code of ethics for online gaming intermediaries in a bid to build a "safe, trusted, and accountable" sector with a focus on user protection.

This follows the Ministry of Electronics and Information Technology (MeitY) notifying gaming-related amendments to the IT Act 2021 in April 2023, which will allow multiple self-regulatory organisations (SROs) to determine whether a real-money game, where the transfer of money is involved, is permitted to operate in India or not.

These rules, however, are yet to be implemented in the country, as the ministry has not notified any SROs for the sector until now.

The voluntary code, curated by the influential industry body Internet and Mobile Association of India (IAMAI), was signed by the members of IAMAI's Digital Gaming Committee and the country's three prominent skill gaming industry bodies: the All India Gaming Federation (AIGF), the E-Gaming Federation (EGF), and the Federation of Indian Fantasy Sports (FIFS).

IAMAI's Digital Gaming Committee counts prominent companies and investors such as Nazara Technologies, Krafton, Peak XV (previously Sequoia India), OnePlus, InMobi, and Reliance Jio among its members, while AIGF has members such as Mobile Premier League (MPL), Gameskraft, Deltatech Gaming, Head Digital Works (A23), and WinZO.

“This is a progressive step towards building a transparent and accountable gaming ecosystem with a focus on consumer protection,” said Dr. Subho Ray, President, of IAMAI.

AIGF's Chief Executive Officer (CEO), Roland Landers, said the next level of growth for the industry will depend greatly on a "well-defined regulatory framework."

"We are committed to building a responsible and ethical industry that puts a strong focus on educating players about gaming responsibly and implementing self-checks and self-exclusion, among other things," he said.

EGF represents top rummy and poker operators such as Games24x7, Head Digital Works, and Junglee Games, while FIFS has fantasy sports major Dream11 as its founding member. It's worth noting that Dream11 co-founder Harsh Jain is currently serving as the chairman of IAMAI.

Read: SEBI-like regulator is key for the growth of India’s real-money gaming industry: Dream Sports CEO Harsh Jain

"The year 2023 has been eventful for the sector. The immediate imperative is the implementation of the proposed IT rules by establishing the SRBs with regulatory oversight," said EGF CEO Anuraag Saxena. He said that these rules will play a "crucial role in creating a safe and transparent gaming ecosystem."

Meanwhile, FIFS Director General Joy Bhattacharjya said this code of ethics reinforces the industry's commitment to growing the sector.

All signatories have pledged to "undertake best efforts" to adopt the code's practices.

So, what are the key principles and measures outlined in this voluntary code? We take a look.

Setting limits: Online gaming intermediaries will provide users with the option to set time or spend limits for themselves. They will also offer a self-exclusion feature through which players can willingly suspend their access for a chosen period. In addition, they will use tools to monitor player behaviour and provide appropriate support features to players "demonstrating at-risk behaviour."

This measure comes amid concerns by the central and multiple state governments over addiction, debt, and suicides, driven by losses in real-money games in recent years. In its rules, MeitY has defined a gaming intermediary as an intermediary that offers "one or more than one online game."

Age-gating: Gaming formats involving real money prizes or awards will not be offered to users who are less than 18 years old. Gaming intermediaries will ensure that age restrictions are communicated to players by prominently displaying the “18 or 18+ only” signage across all their platforms for these formats.

These intermediaries will also disable access to accounts when they discover or receive knowledge that the account belongs to a minor.
Anti-deception: Intermediaries offering real-money games will not offer any contest or game where the platform, whether directly or indirectly, through its actions, bots, or any other methods, plays against the users.

They will take measures to ensure that all games are played only between real people and not against automated systems such as bots. This includes obtaining certifications from independent third-party organisations and blocking software usage that generates bots or any other computer code, file, or programme designed to tamper with the game's outcome. Regular audits to verify compliance with applicable laws will also be undertaken.

Read: Explained: GST Council’s 28% tax on India’s real-money gaming sector

Financial measures: Intermediaries shall mandate transactions only through recognised digital banking channels, credit/debit cards, and approved mobile wallets. They will not allow transactions in cash, cryptocurrency, or any unauthorised payment system. They will also refrain from engaging in activities that promote or facilitate money laundering or transactions that are not compliant with applicable laws.

In addition, these intermediaries will implement Know Your Customer (KYC) as well as controls and preventive measures to detect and prevent the use of their platform for money laundering or other unlawful activities. They will also ensure that deposits or payments made by users are used only for playing games on these platforms.

These firms will also specify the amount of platform fees charged, the prizes and how they will be distributed, how winners are determined, how it is protecting player deposits, including its refund policy, timeline for players to withdraw their deposited money or prize money, and partnerships with payment processing entities on their respective websites.

Advertising: Signatories will ensure that the advertisement and promotion of pay-to-play games will not induce or entice minors to play them, misrepresent information about winning probabilities, and remain compliant with the Advertising Standards Council of India's (ASCI) advertising standards with necessary disclaimers and warnings.

These ads or promotions would not suggest that participation guarantees winnings unless it is the case as part of a scheme or promotion within the game. Signatories will also ensure claims of total prize money are truthful, verifiable, not exaggerated, and do not directly or indirectly suggest that an individual user can win the total prize money.

These ads would also not indicate that participating in these games is a means of earning a livelihood or an alternate source of income, nor would they promote it as a financial investment or as a means to solve personal or financial problems.

Data storage: Intermediaries will process and store digital personal and non-personal data as per the country's data protection laws. It will also take measures to comply with the existing cyber security regulations under applicable laws, apart from contributing to developing innovative concepts and initiatives to tackle industry problems.

The signatories will also commit to maintaining a "high priority channel" for law enforcement and appropriate government agencies to take expeditious action on any reported law violation or assist authorities in investigation.

The story till now

The Indian gaming industry clocked $3.1 billion in revenue in FY23, registering a 19 percent growth from $2.6 billion in FY22, according to a recent report by a gaming and interactive media-focused venture fund. The sector is projected to hit the $7.5 billion revenue mark by FY28, it said.

The real-money gaming segment, which accounts for the majority of the overall industry's revenue, is, however, facing a turbulent period due to the government's recent 28 percent GST tax regime.