Online gaming in India has had to overcome many, many hurdles. From some states finding them akin to betting and gambling – and subsequently banning them – to the steady stream of headlines damning it as a social ill. One would think we’re back in the days when rock and roll was considered evil.
The sector has been through numerous cases of adverse legislation, with the courts coming to its rescue each time. Judicial validation has saved the day with the Supreme Court opining that games of skill are distinct from games of chance and are legitimate business activities according to Article 19 (1) (g) of the Constitution of India.
The High Courts have reiterated this opinion on various occasions. In essence, the delineation between games of skill — such as online skill gaming — and games of chance — such as gambling and betting — has always required an intervention.
The Center has realized the positive implications that the online gaming industry has for the economy, employment, start-up ecosystem, innovation and stepped in to solve the conundrum of a uniform regulatory mechanism.
Efforts are already underway, with the announcement of the Ministry of Electronics and Information Technology (MeitY) as the nodal ministry for governance. Online gaming companies have been designated as ‘intermediaries’ in the Draft Rules for the proposed amendment to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
The first step by the Center comes in the form of the constitution of a self-regulatory body (SRB) as a governing authority for the mandatory registration of online games for legal operation in the country.
The Draft Rules provide a host of other mandatory due diligences to be undertaken by online gaming companies. There are exhaustive systems in place for grievance redressal and KYC requirements among other mandates.
The spotlight now needs to focus on establishing the rules for the SRB as the final frontier for clarifying governance for online gaming industry. The possibility of more than one SRB existing calls for a codified and uniform Code of Conduct. The implications of non-standard processes across the spectrum need to be considered.
In the absence of a Common Code of Conduct across SRBs — operating on different issues and norms — there is the fear of “forum shopping”, where intermediaries may approach multiple SRBs as an alternative remedy, adding to the pendency of the issue being decided. Avoiding this situation is critical in the consideration of a common Code of Conduct.
In addition to removing ambiguity from processes, this will also serve to streamline operations, leaving no scope for subjective interpretations or dilatory litigation. There are multiple parameters that this proposed Code needs to address.
Beginning with the technical framework for the approval parameters for games, the Code of Conduct needs to mark out the standards for approval, to remove any ambiguity in the process. Clarity on dispute resolution is another factor that needs to be considered, from both perspectives: that of the user and the intermediary.
The Code needs to further clarify the standards for advertising and marketing communication, in addition to the membership and registration of both online gaming intermediaries as well as online games. As a quasi-judicial authority — where the SRB is tasked with certification and approval for gaming formats — the applicability of the rules needs to be transparent and clear-cut.
The expanding scale of the industry also mandates a clear set of rules for optimum and effective governance.
The concretization of this Code is essential to standardize the governance of the industry. Another tier of checks and measures can be put in place with a Grievance Appellate Committee that will ensure compliance of the SRBs with the proposed Code.
The Code can also act as a ready-reckoner for SRBs for effective governance, adding more coherence to the process. The proposed Code needs to be a repository that is made in conjunction with the government and industry, reaffirming that the way forward for the industry and the economy is together.
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