Madras HC wants online sports regulated, seeks curbs on virtual gambling

Wonders why the law is so quick to come down on physical gambling while permitting virtual

The Madras High Court has said a comprehensive framework is necessary to regulate online sports and curb illegal activities. The Court is also of the view that there should be a regulatory body to monitor and regulate and legal gaming, both in the real and virtual spaces. 

In the D Siluvai Venance vs Inspector of Police (Koodankulam Police Station) case, Madras High Court Justice B Pugalendhi today wondered why the police was so prompt in implementing the Tamil Nadu Gaming Act if a person was caught playing cards, while online rummy was permitted not only in the state, but also in other parts of the country.

The court noted that online services such as RummyPassion, Nazara, LeoVegas, Spartan Poker, Ace2Three, PokerDangal, Pocket52, My11Circle, and Genesis Casino are mushrooming and several advertisements are appearing in almost all the social media and websites. In its order it said that these these advertisements were mostly targeting unemployed youth, inducing them to play such games on the hope of earning money comfortably. 

The Assistant Inspector General of Police, Law and Order, filed a status report in which he stated that there was a growing addiction for online gaming/gambling, particularly among youngsters, which was causing financial crises in families. Online gaming companies in India are now required to comply with multiple laws, both Central and State, but most aren't, given the techno-legal requirements of different laws of India.

He admitted that there is no rule in Tamil Nadu at present to regulate and license online skill games such as rummy, bridge, nap, poker and fantasy sports.

The Court further stated that India has a rich heritage with a diverse range of sports / games. Sports is not only an important source of entertainment, but also imparts the value of hard work, discipline and co-operation. To regulate the physical sports / games, we are having a legislative set up, but having such a set up to deal with the emerging online games / virtual games is the need of the hour.

"A comprehensive framework by a regulatory body is necessary to regulate the online sports and curb any illegal activities as well. In fact, such regulation of online sports would encourage investment in the sector, which could lead to technological advancements as well as generation of revenue and employment", said in the Order.

The Court further said that it hopes and trusts the state Government will take note of the present situation and pass suitable legislation, keeping in mind the law of the land as well as the judicial precedents in this regard. 

The court said it is not against virtual games, but laments the absence a regulatory body to monitor and regulate legal gaming in the real world and virtual world. "Needless to say that if the Government intends to pass a legislation in this regard, all the stakeholders should be put in notice and their views should be ascertained," it said.

Commenting on the order, Roland Landers, CEO of All India Gaming Federation said "We welcome the order of the Madras High Court which iterates that the Court is not against virtual gaming, and which calls for the government to devise a regulatory framework to provide clarity to the sunrise online gaming industry with a view to encourage investments leading to technological advancements as well as generation of revenue and employment. As the foremost representative of stakeholders of the online gaming industry, AIGF looks forward to wholeheartedly supporting the government in carrying out these directions of the Hon’ble Court. Our self regulation charter and panel of experts are at the government's disposal for further engagement."

The Indian online gaming industry is growing at an exponential rate, and is expected to be worth $1.1 billion by 2021, according to Google-KMPG. The projected user base is estimated to more than 628 million gamers.