Gaming and Banning: On Ban on Online Games

Why in the News?

Recently, a division bench of the Karnataka High Court delivered a judgment striking down major portions of the Karnataka Police (Amendment) Act, 2021.

Probable Question

How does online gaming addiction impact children? Do you think banning online gaming is a good way to tackle it?

Key Points

• Karnataka Police (Amendment) Act, 2021 is a law that was introduced by the state government to ban online gaming platforms that involved any wagering or risk of money on an uncertain event.
• The Act banned all formats of online games including wagering, betting and gambling of all nature in the state.

Key Highlights of the High Court Ruling

• The Karnataka High Court struck down the amendments to the Karnataka Police Act on three major grounds:
  • Violation of Fundamental Rights of Trade and Commerce, Liberty and privacy, speech and expression.
  • The law being manifestly arbitrary and irrational insofar as it did not distinguish between two different categories of games, i.e., games of skill and chance.
  • Lack of legislative competence of State legislatures to enact laws on online skill­based games. 
• The court held that games, where substantial effort, knowledge and skill is required, are different from games of mere luck or chance.
• The court also held that the State government provided no evidence or data on whether a sweeping ban was justified and neither constituted a committee of experts to study the issue.
• The court pointed that playing online games could help in building the character of an individual and enjoying online gaming could also fall within the contours of freedom of expression and right to liberty and privacy guaranteed under the constitution.

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Other States with Similar Laws

• Earlier, Andhra Pradesh, Telangana, Odisha, Sikkim, and Nagaland have banned online gaming by bringing in laws.
• Since gambling is a “state” subject under the Indian Constitution, regulation differs between states.
• A similar law introduced by the Tamil Nadu government was struck down by the Madras High Court in August 2021. 
• In September 2021, the Kerala High Court had also quashed a notification issued by the State government specifically banning the game of online rummy when played for stakes. 

Why are States Resorting to Banning Online Games?

• Many social activists, government officials and those in law enforcement believe that online games like rummy and poker are addictive in nature; and when played with monetary stakes leads to depression, mounting debts and suicides. 
• Reportedly, there have been a few instances where youngsters, faced with mounting debts due to losses in online games have committed other crimes like theft and murder.
• Earlier, the World Health Organisation (WHO) had warned that “internet gaming has turned worse than drugs” and has classified “gaming disorder” as a mental health condition.
• Online games are susceptible to manipulation by the websites operating such games and there is a possibility that users are not playing such games against other players, but against automatic machines or ‘bots’, wherein there is no fair opportunity for an ordinary user to win the game. 

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Is Regulation on Online Gaming a Better Idea?

• An outright ban may not entirely curtail the playing of such online games, with or without stakes.
• Telangana, which was the first State to ban online games for stakes in 2017 has seen a spurt of illegal or underground online gambling apps.
• Most of which originate from China or other foreign countries and accept payments from players through dummy companies or hawala channels.
• Both the Enforcement Directorate (ED) and local cyber-crime authorities have tried to crack down on such apps but with limited success.

Shifting of users to grey or illegal offshore online gaming apps not only results in loss of tax revenue for the State and job opportunities for locals but results in users being unable to avail remedies for any unfair behaviour or refusal to pay out winnings.

Way Forward

• Experts believe that instead of a complete ban, the state should look at licensing and regulating the industry with various checks and balances such as:
  • Diligent KYC and anti­money laundering processes, 
  • Barring minors from accessing real money games, 
  • Placing weekly or monthly limits on the money that can be staked or time that can be spent, 
  • Counselling for addictive players and allowing self­exclusion of such players etc. 

The regulation of online games may be a better and proportionate solution rather than an outright ban, and it should be left open for the State government to come up with new legislation dealing with betting and gambling in accordance with the provisions of the constitution.

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