Indian Government Recognizes Difference Between “Online Games” and “Online Real Money Games”

The Ministry of Electronics and Information Technology (MeitY) published the final amendments to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, on 6th April. These new changes have added a differentiation between “online games” and “online real money games.” Furthermore, the rules will allow multiple self-regulatory organizations (SROs) to determine the legality of real-money games in India. 

These amendments were made after MeitY held discussions with stakeholders, including gaming companies, industry bodies, players, lawyers, and more, in the past few months.

MeitY differentiates between “online games” and “online real money games” 

In January 2021, MeitY proposed amendments to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021. The proposed changes aimed to introduce regulatory norms for online gaming in the country. However, the amendment lacked a differentiation between “online games” and “online real money games.” 

The latest changes define “online games” and “online real money games” as follows: 

Online game: A game that is offered on the Internet and is accessible by a user through a computer resource or an intermediary.

Online real money game: An online game where a user makes a deposit in cash or kind with the expectation of earning winnings on that deposit.

MeitY to empower SROs to determine the legality of real-money games

According to the updated rules, games involving real-money gaming will fall under the purview of Self-Regulating Organizations (SROs). This means the responsibility to determine the legality of real money games is now passed on to industry bodies. 

In a press briefing on 6th April, the Union Minister of State for Electronics and IT Rajeev Chandrasekhar reportedly stated that “these rules don't deal with all the sophistication into what is game of chance or game of skill.” He added that gaming companies will only have to go to SRO if there is money involved in the game. He added that MeitY would let the SROs decide “what is addictive” and “what constitutes user harm” and that MeitY would not prescribe any such criteria, as it is likely to evolve.

The Indian gaming industry has been recently overwhelmed by ambiguity over whether games like Rummy or Poker could be considered online games, the government’s recent distinction will certainly help establish a significant difference between “games of chance” or “games of skill.”