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Legal Scenario in Online Gaming Industry

Why was there a Rise in Video Gaming?

There has been a rise in internet usage and dependency on the web and electronic devices for everything from ordering food and groceries to online payment and over-the-top (OTT) platforms for entertainment. One such area is online video games. The whole idea of overall dependency on the internet has risen significantly after the COVID-19 pandemic. We all heard growing up that playing video games is not suitable for health, increasing obesity and overall development but as of now India has become a country with more than 580 million Internet users. India has also witnessed an increase in mobile users and affordable internet. Smartphones are available at cheap rates and have great accessibility at the same time which means the players can play video games anytime and anywhere. The young generation is more likely to get involved in playing video games and the population composition of the country is such that the young generation of age under 45 years comprises 75% of the total population.

Need for a Video Gaming Regulation

There are three types of gaming in the video gaming industry. Firstly, Video Games can be played individually, between professional players and also as teams. In the 90s e-sports were played online on individual computers or on gaming consoles in video gaming parlours. Secondly, Fantasy Sports is where a team of sports players is chosen and the team aims at the points that are to be gained based on the skills that the player has developed playing the game. And thirdly mental and physical skills-based videogames where the video games are to be played purely based on the mental and physical skills of the player. The games where the effect is based on the chance the way we throw a dice where the effect is not predetermined. These games of chance if connected with gaining or losing money are gambling based. Except for the states of Goa, Sikkim and the Union territory of Daman, the whole of India bans gambling and is considered ethically wrong. The video game industry is put into a grey area where the regulation is very difficult in the absence of any Video games regulation till now. People develop a compulsive need to play games and get dependent on playing video games to perform their day-to-day duties. This addiction to video games is destroying lives and families. With the increase in screen time, the problem of dealing with the gaming industry was a problem and the pandemic has only played a role of a catalyst. Blue Whale challenge (which worked on AI) related deaths were noticed, as well as ‘pubg’ addiction, leading to the ban of both these apps in the country.

Online Gaming Regulation Bill, 2022

On the first day of April 2022, the bill titled Online Gaming Regulations Bill, 2022 was introduced in the Lok Sabha which is the lower house of Parliament in India. Some of the important words concerning the regulation are defined in chapter 1 of the bill. Section 2 (e) defines “Online Gaming” as games that can be played on any computer, smartphone, tablet and any other electronic device. Section 2 (f) defines “Online Gaming Server” as one computer or more sets of computers that are maintained and installed as per licences; these servers are meant to accept, process and store all the transaction related to online video games and the video gaming system is managed by this server. Section 2 (g) defines “Online Gaming Website” as the internet domain or URL address where the online games are running. Section 2 (h) defines “player” as anyone who is participating in any of the licenced video games that are licenced by the commission.

Chapter 2 of the Bill deals with Regulations concerning Online Sports Betting. The gaming industry has grown which is why there was a need for the gaming regulations. The gaming regulations in the bill focus on the following points: -

1. Chapter 2 of the bill talks about constituting an online gaming commission.

2. This commission is supposed to have one chairperson and vice-chairperson along with five members with one legal expert, one technology expert and one expert in the enforceability of laws.

3. This commission is responsible for

(i) Keeping a watch on the online gaming industry;

(ii) Prepared reports and periodicals to be submitted to the Central Government, and to ensure that illegal gaming is not prevailing. The commission is also given the authority to revoke or invoke the licences granted to the companies making online video games in case of non-compliance with the regulation.

4. The act specifies that involving any gaming website or server without a licence would be illegal. If engaged the person may be imprisoned for 3 years with a fine.

5. The licence that is granted by the commission to the companies will have a validity of a period of 6 years after which the licence will be needed to be renewed. The nature of the licence is non-transferable which means this licence cannot be sold or transferred to any other entity.

Online Gaming Scenario in the UK

In the UK the games are mandatorily required to be rated using PEGI (Pan European Gaming Regulation) system by GRA also known as the Game Rating Authority. Games Rating authority is a part of the Video Standard Council. The PEGI system is being used by the parents or guardians to decide on age-appropriate video games for the concerned child. PEGI rating 3, 7, 12, 16 and 18. PEGI 3 rating fits all age groups. PEGI 7 rating includes the mild form of violence which is not realistic but can have a tendency to frighten children. PEGI 12 rating includes the violence and fighting with more magnitude or by involving any sort of sexual insinuation at the same time the bad language used is mild. PEGI 13 covers the scenario where the violence and sexual insinuation are covered even more and appear more real. PEGI 13 also covers the increasingly intense use of bad language. The use of tobacco, alcohol and other illegal drugs can be displayed. PEGI 18 includes gross violence of that sort which stimulates or influences violence and killings of unarmed and helpless. Glorification of usage of illegal drugs and gambling stimulation or clear sexual depiction in the game.


The initiation of making regulations on Online gaming is definitely praiseworthy. But at the same time, these regulations are limited majorly to online sports betting games. Threats while playing video games like Phishing, Data Breach, Spyware and Malware can be considered while developing these regulations in future. The role of the commission can be increased with the regulation of the whole Online video gaming industry. The role of Artificial Intelligence and the addictive nature of the videogames should be regulated with age restrictions.




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