Govt sets up panel to regulate online gaming

Published on May 25, 2022 03:40 PM IST
The committee has been mandated to study global best practices and recommend a regime for a uniform regulatory mechanism
 (Shutterstock)
(Shutterstock)
ByDeeksha Bhardwaj

NEW DELHI: The government has set up a committee to regulate online gaming and to identify a ministry to oversee it, according to documents HT has examined. The panel will include the chief executive officer of government think tank NITI Aayog and secretaries of the ministries of home, sports and youth affairs, information and broadcasting, electronics and information technology, etc.

The committee has been mandated to study global best practices and recommend a regime for a uniform regulatory mechanism. It will take into account ease of doing business as well as compliance, a level playing field, and protection of gamers from user harms such as addiction. The panel will also develop a broad structure of the proposed central laws required, consult experts and submit a report in three months.

A group of ministers has found merit in imposing 28% Goods and Services Tax (GST) on online gaming to bring it at par with levies on casinos, racecourses and gambling. It is, however, yet to formally submit its report to the GST Council, the final decision-making body

Global fantasy sports revenues were estimated to be around $20.36 billion in 2020. They are expected to reach $38.60 billion in 2025. Almost all major sports across the globe have fantasy leagues attached to the dominant leagues.

State laws in the US regulate what constitutes gambling and how gambling is regulated. Many states consider fantasy sports as a “game of skill” rather than a “game of chance” and as such, they do not come under gambling legislation. Some states consider them gambling others do not. Therefore, it creates inconsistent regulation.

Kazim Rizvi, the founder of the tech policy think-tank The Dialogue, said fantasy sports are fast becoming a trend and played a significant role in leading the digital gaming movement in the country. “It is a country with a mobile-first population and a mobile gaming market worth $2.4 billion in 2020. Asia is the top region in the mobile gaming industry and India is the biggest fantasy sports market with over 200 companies and 130 million users, and a market of 34,000 crore.”

Rizvi said India needs to regulate fantasy sports and have central legislation or central guidelines. “An enabling uniform national regulatory environment by the Centre can encourage responsible gaming, and ensure consumer protection through measures such as age-gating and regulatory certainty.” He said such a regulatory environment will allow for the growth of the fantasy sports industry and allow India to maximise the potential of this sector. “Moreover, we need a parent or a nodal ministry that enforces the regulations.”

Rizvi said as part of a light-touch regulatory approach, a self-regulatory organisation can play a significant role in setting and enforcing rules and standards relating to the conduct of companies that operate in the fantasy sports and online gaming industry.

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