Cabinet assigns MEITY administrative powers for 'online gaming'

The Union Cabinet on Monday assigned the Ministry of Electronics and Information Technology the administrative authority for the ‘online gaming’ industry. This essentially kickstarts the union government’s ability to regulate betting and gambling sites (although these services cannot be classified as such legally under Indian law due to various court judgements). 

The Allocation of Business Rules, which outline which ministry takes care of what subject, have been amended to assign MEITY “[m]atters relating to online gaming,” and “e-Sports as part of multi-sports events” has been assigned to the Department of Sports. 

States have made attempts at curbing these so-called “real money gaming” operators, who use that label to run platforms where poker, rummy and other such games can be played for money. But since betting and gambling are a state subject under the Indian Constitution, and real money gaming operators on the internet have prevailed in legal fights to shed that label, attempts to regulate the space have often failed.

For instance, Tamil Nadu has been beaten once in court when it tried to outlaw such platforms, and a second law it introduced for the same purpose hasn’t been signed by the governor. Andhra Pradesh’s chief minister asked the union IT ministry to block some real money gaming sites, but the ministry wrote back last August saying that it would not be able to do so, and said it would be considering a “uniform approach” to online gaming. 

This seems to be that approach. The union government further foreshadowed its new role in the space when it reportedly wrote a letter to all states’ top bureaucrats, asking them to repeal the Public Gambling Act of 1867 for gambling alone, and put in place a fresh law. An inter-ministerial task force has suggested that online gaming be centrally regulated.

It is not clear whether the union will rein in the industry much. The Group of Ministers tasked with coming up with a GST rate for online gaming platforms is at a deadlock, and efforts to impose a 28% slab for winnings from such platforms have slowed to a halt.