Tamil Nadu governor RN Ravi has approved an ordinance to ban online gambling and regulate online gaming in the state. Following the approval, the Tamil Nadu prohibition of online gambling and regulation of online games ordinance, 2022 came into effect.
The prohibitions include online gambling, playing online games of chance like Rummy and Poker with money and other forms of stakes, advertising in any media platform which directly and indirectly persuades a person to play. According to the ordinance, no banks, financial institutions or any other forms of payment gateways can be involved in transactions.
As part of the regulations the local online games providers can provide service only after receiving a registration which will be valid for three years.
The non-local online games providers are prohibited from providing any online gambling service, those with money and stakes and any online games that go against new regulations.
Anyone violating the new rules will face imprisonment upto Punishment for online gambling service providers is imprisonment which may extend up to three years and a fine amount up to Rs 10 lakh.
Anyone who violates the new regulation will have to face imprisonment which may extend to three months and one year along with a fine of Rs 5000. For person advertising imprisonment Rs 5 lakh respectively.
Commenting on the development, Roland Landers, CEO – The All India Gaming Federation, said, “The Tamil Nadu government has passed an ordinance that will result in banning most online games of skill including rummy and poker. What this ordinance in effect does is treat and conflict games of skill as gambling and games of chance. This is disappointing as it disregards the 6 decades of established legal jurisprudence and also the recent judgment of the Madras HC which struck down a similar law.”
“As the apex industry body for online gaming, we at the All India Gaming Federation have been engaging with the government to understand their concerns and have also made them aware of the proliferation of offshore gambling websites and apps which flourish when constitutionally protected India apps are banned. We had provided various consumer protection and other measures which stopped short of an outright ban. In such a scenario this is unfortunate. What is also surprising is that the State government has already appealed the judgment of Madras HC and the SC had recently issued notices on the same. Instead of waiting for the SC judgment and in the meantime respecting the categorical decision by their own HC, they seem to have taken another unconstitutional decision which will eventually only benefit online gambling operators,” he added.
Landers further added, “The ban can have an adverse effect on the state and will push more and more people towards illegal offshore websites. The sector needs the support of state governments now more than ever. Landers further added, “India is the fifth largest online gaming market globally and skill-based gaming, a sunrise sector, is giving birth to an increasing number of unicorns within the country. The sector has been a strong financial contributor to the Indian economy even during an unprecedented period of slowdown and is further expected to generate revenues in excess of 5 billion by 2025. Any form of the ban will impact the overall business of a sector, as will the overall online skill gaming ecosystem due to the recent TN ordinance.”
Other states banned online games
In August 2022, Kerala government said it was considering amending its gaming laws to regulate online games, months after the Kerala High Court set aside a state government notification prohibiting online rummy games.
Though the State had banned online rummy in 2021, the High Court revoked the ban considering a plea by gaming companies.
The Karnataka High Court in February 2022 struck down a state government law that banned online gaming.
In September 2022, the Supreme Court agreed to hear a plea by the Karnataka government, challenging the Karnataka High Court judgment, which struck down provisions of law prohibiting betting and wagering in online games.
Telangana, Andhra Pradesh and Odisha have prohibited both online gaming and online gambling.
