New Regulatory Framework For Online Gaming May Introduce Spending Limits: Report

An inter-ministerial group, set up by the government to come up with a framework to regulate online gaming, is reportedly likely to introduce rules governing the amount of money individual players spend on the games.

Set up by the Ministry of Electronics and Information Technology (MeitY), the inter-ministerial group is also planning to set a limit on the money spent daily by players on in-game purchases, the Economic Times reported.

The idea behind introducing spending limits is to protect consumers and gamers, sources were quoted as saying.

As per the report, the draft regulations are likely to be finalised over the next month, following which they will be released for public consultation.

Earlier this month, the inter-ministerial group also suggested that MeitY amend the Information Technology Act of 2000 to include rules for the gaming segment, drawing parallels with the Intermediary Guidelines and Digital Media Ethics Code that were introduced in February 2021.

The seven-member panel, which was formed earlier this year, includes government think-tank Niti Aayog’s CEO as well as secretaries of home affairs, electronics and IT, information and broadcasting, and sports ministries. It also includes secretaries of revenue, and industries and internal trade departments.

The rules for online gaming under the IT Act will also contain clauses on self-regulation, and the gaming sector has been asked to come up with a self-regulatory organisation (SRO). 

While the government is happy to support an industry-led SRO, the body should not be a “toothless” one, an official was quoted as saying.

Industry representatives had approached the government with two proposals on SROs, however, MeitY rejected the proposals and asked them to rework the clauses. 

It has been proposed to include members from government, industry and technical experts from various fields in the SRO, which will be a five or seven-member body headed by a retired judge from the Supreme  Court or one of the high courts.

Besides administrative duties, SRO would have the power to decide if a game is game of skills or game of chance and can issue content takedown notices if needed. 

In June, MeitY held a meeting with 40 online gaming platforms, including gaming unicorns such as Mobile Premier League (MPL), Dream11 and Nazara Technologies, to discuss the national framework for them.

Online gaming has gained immense popularity over the last few years, with the number of online gamers in the country reaching 390 Mn in 2021. It generated a revenue of nearly $1.3 Bn during the year. However, the industry continues to face regulatory hurdles in the absence of uniform regulations for the gaming sector across the country.