In recent news, the Union government of India has introduced new rules for online gaming companies. The new rules aim to help India achieve its goal of becoming a one trillion-dollar digital economy by 2025-26. In this essay, we will discuss the new IT rules for online gaming companies, the self-regulatory bodies and who can join them, and how the new rules impact the online gaming industry in India.
New IT Rules for Online Gaming Companies
The Indian government released the first version of the new IT rules in January 2021 and worked with the industry to finalize them. The final version requires online platforms to stop misleading or fake information from being shared. Online gaming companies must act as digital intermediaries, check games and customers, remove fake information, and follow self-regulatory body rules.
The new rules also ban offshore betting ads and prohibit gaming companies from offering gambling. Platforms must inform users of rules, privacy policy, terms of service, and user agreements, including KYC procedures and deposit protection measures. Rule 4A outlines the online real-money game verification process.
Self-Regulatory Bodies and Who Can Join Them
The government will select three self-regulatory bodies to make rules for the online gaming industry. Trusts and for-profit organizations cannot apply, and there are specific requirements for the members who can join these bodies. Existing industry groups will not qualify as self-regulatory bodies, and it may take up to eight months to form them, according to an industry expert.
The bodies must be registered under the Companies Act, have members from the gaming industry, and have a board of directors without a conflict of interest. They must also publish a list of members, frameworks for verifying online real-money games, and a grievance redressal framework, along with contact information for a grievance officer. They must update the list of allowed online real-money games and provide details about the applicant and the validity period of the verification.
Impact of the New Rules on the Online Gaming Industry in India
The new rules encourage gaming companies to be more responsible and promote responsible gaming behavior. Gaming companies must display a verification mark from an online gaming self-regulatory body to indicate that the game has been verified, and unverified games cannot be advertised. Although gaming companies receive intermediary protections under Section 79 of the IT Act, online gambling is still not considered legal. The regulation of gambling is the responsibility of the individual states, and they have the power to regulate it within their borders.
Why In News
In a bid to regulate the online gaming industry in India, the Union government recently updated the Information Technology Rules, making it mandatory for online gaming companies to act as digital intermediaries and weed out fake information.
These companies are also required to comply with rules set by self-regulatory bodies, which are expected to be formed within the next eight months. These changes aim to encourage responsible gaming behavior and promote India’s goal of becoming a one trillion-dollar digital economy by 2025-26.
MCQs about New Rules and Self-Regulatory Bodies for Online Gaming Companies in India
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What is the main purpose of the new IT rules for online gaming companies in India?
A. To ban offshore betting ads and prevent gaming companies from promoting gambling.
B. To require online platforms to stop misleading or fake information from being shared.
C. To help India achieve its goal of becoming a one trillion-dollar digital economy by 2025-26.
D. All of the above.
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What are the self-regulatory bodies, and who can join them?
A. They are industry groups that qualify as self-regulatory bodies, and anyone can join them.
B. They are government organizations that make rules for the online gaming industry, and anyone can join them.
C. They are registered companies with members from the gaming industry and a board of directors without a conflict of interest, and specific requirements must be met to join them.
D. They are non-profit organizations that make rules for the online gaming industry, and existing industry groups can join them.
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What is the impact of the new rules on the online gaming industry in India?
A. The new rules make online gambling legal in India.
B. The new rules encourage gaming companies to be more responsible and promote responsible gaming behavior.
C. The new rules require online gaming companies to offer gambling.
D. The new rules ban all online gaming in India.
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