With the user base of online games growing in India, it is necessary to ensure that such games be offered in conformity with Indian laws and that the users of such games be safeguarded against potential harm. Towards this, the Ministry of Electronics & Information Technology (“MeitY”) released draft amendments to the IT (Intermediary Guidelines & Digital Media Ethics Code) Rules, 2021 in relation to online gaming (“draft amendments”) for public consultations on January 2, 2023. The key changes proposed in the draft are:

• The definition of online game is set out as a game that is offered on the internet and is accessible by a user through a computer resource if he makes a deposit (in cash or in kind) with the expectation of earning winnings (in cash or in kind that is distributed to a user based on the performance). Accordingly online gaming intermediary means an intermediary that offers one or more than one online game.

• Additional due diligence is to be observed by online gaming intermediary, namely:
• Display of a visible mark of registration on all online games registered by the self-regulatory body.
• Ensure that all internet intermediaries do not host any online game which is not in conformity with Indian laws, including laws relating to gambling and competent age of contract.
• Inform the user through the terms and regulations, privacy policy, terms of service and user agreements all the policy related to what the game offers, withdrawal, refund of the deposit made with the expectation of earing winnings, manner of determination and distribution of such winnings, fees and other charges payable by the user, risk of financial loss and addiction associated with the online game, KYC procedure to be followed at registration, steps taken to protect the deposit of a user and framework of the self-regulatory body.
• Prominently publish on its website, mobile based application or both, a random number generation certificate and a no bot certificate from a reputed certifying body for each online game offered along with relevant details.
• For all users who register from India must verify their identification and follow the prescribed procedure regulated by the Reserve Bank of India. Also, users who register for their services from India or use their services in India have to voluntarily verify their accounts by using appropriate mechanism, including an active Indian mobile number and where any user voluntarily verifies their account, such user shall be provided with a demonstrable and visible mark of verification which shall be visible to all. Such data cannot be used for any other purpose until and unless the user has expressly consented to such use.
• Appointment of (i) Chief Compliance Officer to ensure compliance with the Act and rules made thereunder and who shall be liable for any non-compliance with the due diligences or in relation to any relevant third-party information or data or communication links made available via the intermediary’s platform; (ii) Resident Grievance Officer; and (iii) Nodal Contact Person for 24×7 coordination with law enforcement agencies and officers to ensure compliance to their orders.
• Requirement of a physical contact address in India be published on its website and mobile based application.
• Set up an appropriate mechanism for grievance redressal so that the user can track the status of their grievance with a unique ticket number.

• Each online game offered by the intermediary will have to be vetted and registered with the self-regulatory body registered with the IT ministry. Every registered self-regulatory body shall evolve a framework to secure the interests of the user, undertake testing and verification to establish conformity of online games with such framework, continuously update and further evolve such framework, testing and verification protocols, and shall prominently publish the same on its website and mobile based application. The self-regulatory body must establish a dispute resolution mechanism for time-bound resolution of complaints not resolved by the online gaming intermediary. Such appeals will go to the Grievance Appellate Committee. If the self-regulatory body is not compliant with its responsibilities and has failed to rectify such non-compliance under MeitY’s notice, MeitY can suspend or revoke the registration after providing an opportunity of being heard.

• If a game offered online without any deposits is considered to create a risk of harm to the sovereignty and integrity of India or security of the State or friendly relations with foreign States of public order or on account of causing addiction or other harm among children, MeitY may notify such game to be registered with a self-regulatory body and comply with the related due diligences as per the IT Rules, 2021.

Feedback is invited from the public on these draft amendments which can be submitted online at https://innovateindia.mygov.in/online-gaming-rules/ by January 17, 2023.