India’s High Court Decisions Provide Guidance on Online Gaming Laws but Policymakers Need to Do Their Homework

Several recent HC rulings restored the gaming market to its earlier constitutional boundaries but also raised many questions. Until legislators manage to assemble proper regulation for online games, legal battles on state and national level might well continue.

Why Do State Gaming Bans Keep Being Struck Down?

The decision of Karnataka High Court to strike down amendments to the Police Act banning all online games for money is the latest in a series of unsuccessful state-level legislation on the matter. Attempting to outlaw all online gaming for stakes has ended up impacting skill games like rummy, poker and fantasy sports, repeatedly declared legitimate by the Supreme Court and local High Court rulings.

GOVERNMENT LOTTERY IN INDIA

Karnataka followed the approach of Tamil Nadu and Kerala outlawing all online games on the sole criterion of money being paid-in or risked. Apex courts in Chennai and Kochi, however, rejected the very notion that an entire sector of digital entertainment could be banned without proof, preparation or constitutional conformity.

The entire political movement to block India’s booming online gaming market is based on the conviction of certain social activists and public officials that games like rummy or poker are addictive in nature. Playing them for stakes, they say, often leads to debt and in turn to depression, with many young players even turning to crime to make up for the losses.

Such claims are not only unproven. They omit to mention the government lottery in India, the favorite real-money game of the majority of desi players. It is legal in most states, and aspects such as addictiveness, game fairness or financial planning are rarely doubted. Lotteries are also usually used to finance state projects and welfare programs, making them an economic sector with great social importance.

Adding to these reasons, the courts stress the violation of fundamental rights (of trade and occupation), the arbitrary decision to ban all games (without regard for skill or chance) and the local authorities’ lack of legislative competence to enact similar laws for all online games.

State governments provide no evidence – scientific or otherwise – to back their measures, relying on political sentiment and seeking to appease interest groups. Encroaching on personal rights, liberties and entertainment choices, however, is hardly the proper way to deal with the tech industry’s fastest growing segment.

Regulation a Better Solution

The Supreme Court has explicitly upheld the nature of games like rummy, poker and fantasy sports as legitimate – involving effort, skill and knowledge. This has been the case with horse racing decades ago, as a number of games for money have established their legitimacy on a national scale. States have been left with the prerogative of deciding on how to treat games of chance instead.

Karnataka High Court judges were the latest top-level legal figures to counsel legislators on the effectiveness of proper gaming regulation. Certainly a better proposition than outright bans, gaming laws have the potential to control real-money gaming through licenses, operator requirements and player checks and limits.

Telangana’s experience with an online gaming ban went poorly after 2017, analysts remind. State residents fell for unlicensed offshore apps (many from China) and outright black-market dealers. People lost any kind of protection for their payments, no game mechanics was under control and cyber-crime units were overwhelmed with work, achieving only sporadic success in their fight.

Protecting the public interests and ensuring player safety is only possible through modern online gaming regulation. Measures for anti-money laundering, KYC player processing, age and spending limits, counseling for vulnerable players and self-exclusion options are only some of the proven methods to raise the quality of gaming operators and guarantee the security of India’s tech-savvy young generation.

Charu Verma
Charu decided to unite her Honors Degree in New Media and lifetime of geekiness to pursue a career in tech and gaming journalism. You can usually find her writing about a variety of topics and drooling over new gadgets and games.