Games which are played over a computer network using internet are known as online games. It not only includes simple text based games but also incorporates complex graphic and creation of a virtual world through the gaming platform. Online games are games which offer a mode of online interaction with other players. Initially, sports were considered as games which are played by using physical strength and strategy, however, with the fast growing IT industry online gaming is also being recognised as a sports.
Due to the major hit of covid-19 pandemic, the use of OTT platforms for the purpose of entertainment has drastically increased, with more than 65% of people playing online games. The industry has also earned billions of dollars with millions of players using online gaming as a source of entertainment. With the increase in usage, it has also become important for the law commission to regulate online gaming as, through games, personal data of individuals is also extracted through the devices they use to play such online games.
Through the government notification dates 23rd December, 2022, the government has granted legal recognition to online gaming and stated that online gaming will be considered as a sport and will be regulated under the Ministry of Electronics and Information Technology.
Online games were earlier considered as an activity which is played for enjoyment for children and not as an actual sport. However, a recent judgement of 2022 passed by the Supreme Court stated that online gaming comes under the ambit of sports and is not just for enjoyment purpose.
Online Gaming (Regulation) Bill, 2022
The Online Gaming (Regulation), Bill was introduced in the Lok Sabha on 1st of April, 2022, regulating online gaming in India and giving it a legal status. It was introduced with the aim of establishing an effective regime to regulate online gaming industry, to prevent fraud and misuse on the internet gaming industry. The bill is applicable to whole of India except persons providing backend services in India, including hosting and maintenance services, for any international gaming website based outside India. The bill gives effective measures to protect online gaming by forming an Online Gaming Commission, to oversee the entire functioning of the gaming websites, making periodic and special reports for the central government, suggesting measures in order to prevent illegal online gaming and granting or suspending licence which are issues to the websites.
The bill states that the commission would include one chairperson, one vice-chairperson and five other members nominated by the central government including one person from the field of law, one from the field of cyber technology and one should be a law enforcement officer.
The bill restricts functioning of gaming websites without a license which is to be obtained by applying to the Online Gaming Commission. A license for is granted for 6 years and is to be renewed every six years. The Commission has also been given the power to suspend or revoke the license if they observe any activity which is not fundamental.
Further, the bill of 2022 gives complete power to the online gaming commission to make any rules which they feel are essential in order to prevent illegal activities.
Though it has been more than 6 months since the bill was introduced in the Lok Sabha, yet it has not been passed and implemented, leaving the online gaming industry unregulated.
Draft Rules, 2022
The draft rules formed for regulating online gaming under the Information Technology (Intermediary Guideline and Digital Media Ethic Code) Rules, 2021 were introduced on 2nd January, 2023. The draft rules proposed formation of a self-regulatory body under which all the online games had to be registered. The self-regulatory body should consist of 5 members from different fields including online gaming, public policy, information technology, psychology and medicine. Further it focused on the due diligence perspective of online gaming introducing the Know Your Customer (KYC) Policy, under which the ‘online gaming intermediary shall display a demonstrable and visible mark of registration on all online games registered by the self-regulatory body’. The draft rules also suggest appointment of a compliance officer to ensure all the norms are being followed and there are no irregularities.
The draft rules introduced to regulate online gaming under the IT industry does not include provisions for misuse of the of the online platform, and further does not give a clear vision as to the licensing process for online gaming websites.
Analysing the current scenario of online gaming in India, the Law Commission on 23rd January, 2023 suggested the officials of the Information Technology Ministry to put the online gaming industry on hold till they come up with a comprehensive report on the same.
Online gaming industry, which is one of the fastest growing industries, still remains unregulated. Though there have been attempts to regulate the sector, through various rules and amendments, it has not been successful. Though the Bill mentions about licensing, it does not provide a comprehensive procedure for obtaining the same. The proposed legal framework does not mention the penalties or punishment for contravention of the provision.
The laws which are being enforced in the current times are focusing more on online gambling rather than online gaming. However, the laws which are being made for gambling are also being implemented on online gaming, which are misleading as the ambit of both online gaming and gambling are completely different.
 Shri Varun Gumber v. Union Territory of Chandigarh.
 The Online Gaming (Regulation) Bill, 2022, Sec. 1.
 The Online Gaming (Regulation) Bill, 2022, Sec. 4.
 The Online Gaming (Regulation) Bill, 2022, Sec. 3.
 Draft Notification, 2022, Rule 4B (3)(d).
 Draft Notification, 2022, Rule 4A.
Author – Ketan Joshi
Co-Author – Avantika Singh