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The government will act as a regulator for the online gaming sector rather an industry-led self-regulatory organisation (SRO). The ministry of electronics and information technology (MeitY) will now prepare a framework for permitting and certifying online games which involve money, officials said.
Earlier, MeitY had proposed an SRO and asked the industry to submit proposals to this effect. However, officials said that the proposals received were heavily dominated by gaming companies and their industry associations, and therefore would not have been able to act as a neutral regulatory body.
As per IT rules, online real money games need to be approved by a regulatory body. Online games, which do not involve real money, do not require any regulatory nod.
The government had notified the online gaming rules on April 6, 2023 and had given three-months to the industry to come up with proposals for SROs. It had planned to notify three SROs.
“The SRO applications we are getting are too industry dominated. So we are rejecting them,” Rajeev Chandrasekhar, minister of state for electronics and IT said.”We have said very clearly, we don’t want SROs that will be controlled by industry. We wanted it to be representative of a wider base and we didn’t receive any application like that,” Chandrasekhar said, adding that in absence of SRO, by default the government continues to regulate the space.
Chandrasekhar, however, did not share further details on the framework the government is coming up with. It was expected that apart from people with experience in online gaming, SROs will also include educationists, psychologists, individuals dealing with protection of child rights and information & communication technology experts.
Officials said that government analysed four proposals submitted by All India Gaming Federation (AIGF), Esports Players Welfare Association (EPWA), All India Gaming Regulator (AIGR) Foundation & from a consortium of the E-Gaming Federation (EGF) and the Federation of Indian Fantasy Sports (FIFS). But, none of them met the stated requirements.
The government has recently set up a group of ministers to discuss the regulatory framework for the industry but it’s likely that a clear regulatory structure will emerge only after the general elections. In December, companies such as Dream Sports, Games 24×7, as well as industry associations had sought clarity from the government on a code of conduct for the sector.
This was related to actual implementation of notified rules, framework on responsible gaming and player protection, financial frauds, gaming certification, among other aspects. These aspects need to be defined by the regulator.
Among other things, the industry has sought a Sebi-like regulator for the sector.
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