India: Tamil Nadu cabinet approves ban on online gambling

The ordinance will now go to the state’s governor for approval.

India.- The state parliament of Tamil Nadu has approved a ban on online gambling. Only the governor’s approval remains for the ordinance to come into effect. The ordinance was drafted after a committee set up by chief minister Muthuvel Karunanidhi Stalin to investigate the impact of online games recommended a ban or at least limits on the activity.

In February last year, deputy chief minister O Panneerselvam introduced laws that punished online gambling with up to two years in prison or a fine of up to Rs10,000 (US$ 137.15). However, in August 2021, the Madras High Court overturned the legislation after online operators filed a petition. The Tamil Nadu government went to the High Court in December to challenge that decision.

The government argued that teenagers and adults were losing their entire earnings and savings through online betting. Authorities also stated that though rummy might be a game of skill, the game using stakes will become gambling.

Meanwhile, the state of Telangana is rethinking its 2017 ban on all forms of gambling. It introduced the ban after reports of gambling addiction leading to suicides and bankruptcy but has found it led to players being targeted by illegal offshore sites outside of government control.

To date, apart from the Supreme Court’s precedent on skill-based gambling, there is no federal statute to govern India’s gambling industry, with each state taking its own stance on the issue.

India: panel recommends new regulator for online skill games

A panel set up by prime minister Narendra Modi has concluded that India should establish a regulatory body for online skill games. The regulator would classify which online games as based on skill or chance, implement rules to block prohibited formats and enforce stricter gambling regulations.

According to Reuters, the report recommends that a separate law should be enacted to regulate online gaming as a “long-term measure”. In the interim, IT law could be used to regulate the industry until a new law is enacted.

The report also suggests India’s IT ministry act as the central ministry for online gaming, except for e-sports and games of chance and adds that any online gaming platform offering real money online games to Indian users should have a legal entity incorporated under Indian law.

The IT ministry will finalise the report after receiving further comments from panellists, including the heads of the finance and sports ministries. It will be then sent to the Cabinet Secretariat for approval, although there is no timeline.