What are the draft rules for online gaming in India?

Self-regulatory bodies, mandatory know-your-customer standards for verification, and grievance mechanisms are among the key proposals. online game rule draftwas released by the Department of Electronic Information Technology (MeitY) on Monday.

Online games must be registered with a self-regulatory body, and only games approved by the body can legally operate in India. According to the proposed rules, online gaming companies are not allowed to bet on the outcome of games.

Minister of Electronics and IT Rajeev Chandrasekhar said, “With approximately 40-45% of gamers in India being female, it is even more important to keep the gaming ecosystem safe.”

Chandrasekhar described online gaming as “a very important part of the startup ecosystem and part of the goal of a trillion-dollar economy,” and the government is committed to making all opportunities available to India. He said he will work hard to make sure it’s available to startups.

What do the draft rules say?

The proposed rule aims to protect users from potential harm from skill-based gaming and was introduced as an amendment to the Information Technology (Intermediary Guidelines and Digital Media Code of Ethics) Regulations 2021. . This attempt is to regulate online gaming platforms as intermediaries. Impose due diligence requirements on them.

“It is not allowed to bet on the outcome of games according to the principles laid down under the rules. All online gaming companies must be registered with self-regulatory bodies,” Chandrasekhar said.

The self-regulatory body will have a five-member board of directors from various disciplines, including online gaming, public policy, IT, psychology, and medicine. Registered games “do not benefit the sovereignty and integrity of India, the defense of India, national security, friendly relations with foreign countries or public order, or any recognizable offense related to the above.”

There may be multiple self-regulatory bodies, all of which must inform the Center of the games they have registered, along with a report detailing their registration criteria. Chandrasekhar said that in the future, the government may regulate the content of online games “to ensure that games do not contain violent, addictive or sexual content”.

Like intermediaries, online gaming companies must conduct additional due diligence, including user KYC, transparent withdrawals and refunds, and fair distribution of winnings. As for KYC, you must follow the standards set out for entities regulated by the Reserve Bank of India (RBI).

Game companies must also secure a random number generation certificate. This is typically used by platforms that offer card games to ensure that the game’s output is statistically random and unpredictable. You should also get a “no bot certificate” from a reputable certificate authority.

Similar to social media and e-commerce companies, online gaming platforms should also appoint a compliance officer to ensure that the platform complies with the code, a node officer to act as a liaison with the government and assist law enforcement agencies. . A complaints officer who resolves user complaints.

MeitY is soliciting comments on the draft rule by January 17, and the final rule could be ready next month.

Indian Online Gaming Sector

India’s mobile gaming industry revenue is expected to reach $5 billion by 2025. This industry has grown at a compound annual growth rate (CAGR) of 38% in India from 2017 to 2020. 8% in China, 10% in China. percent in the United States.

It is expected to grow at a CAGR of 15% to reach Rs 153 billion in revenue by 2024, according to a report by VC firm Sequoia and management consulting firm BCG.

How have stakeholders reacted to the proposed rule?

Online gaming companies and industry groups welcome the rule.

“We welcome the release of the draft rules that will bring online gaming under unified central regulation,” said Sai Srinivas, co-founder and CEO of Fantasy Gaming Platform. MPL.

“We are grateful to the government for acknowledging the longstanding needs of gamers and the online gaming industry. We hope that the fragmentation of each regulation will be eased,” said All India Gaming Federation (AIGF) CEO Roland Landers in a statement.

“Technological innovation, the creation of culturally relevant intellectual property, and increased access to smartphones and high-speed internet in the depths of Bharat will continue to expand the industry over the next few years, but the necessary stability is just in time. “It was a great experience,” said Saumya. WinZO Games co-founder Singh Rathore said: “The online gaming industry will greatly benefit from a stable policy framework that clarifies what is acceptable. The sector will evolve to be more accountable and safer for end consumers. The central framework will also suspend the state’s routine blanket ban,” he said.

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