Gaming, primarily in the form of mobile, console, and PC gaming, has existed in India for decades. Real Money Gaming (RMG), while not as old as generic entertainment and competitive gaming, has spent the last decade consistently growing in the number of engaged users. It took the COVID pandemic to really skyrocket gaming to the heights it has reached today, and it doesn’t seem to be slowing down.
Since the pandemic hit, investments in this sector have shot up exponentially. What was previously just a playground with a handful of enablers is now a thriving full-fledged sector that is active, competitive, growing, and offering more in terms of value, entertainment, and engagement.
The growth of the gaming and RMG sector has been so rampant that when it comes to the law and policy side of this sector, the government is having to play catch up. For example, digital financial fraud has seen many new cases taking place day after day, but we still don’t have the laws to define these cases as an offense. The courts in India are still debating the definition of “skill gaming” and “online gambling.” The sector is populated with a lot of gray areas, which is understandable as to the government, this is all very new.
These gray areas have ramifications that impact players and companies. Some states decide to completely ban online gaming while utterly failing to define online gaming. That means if you were from that particular state, you could go to jail for playing a tournament with a participation fee, even if the game in question is Dota 2.
Some states decide to completely ban online gaming while utterly failing to define online gaming. That means if you were from that particular state, you could go to jail for playing a tournament with a participation fee, even if the game in question is Dota 2.
In such times, a gamer, any kind of gamer for that matter, or a developer or startup who operates an online gaming company that has an aspect of money transactions, be it “RMG” or in app purchases, need to know their rights, and that is where EPWA (Esports Gamers Welfare Association) comes in. “EPWA is a Non-For-Profit organization dedicated to ensuring the rights of eGamers and players in India are protected. The services offered by our organization range from legal to educational and are tailored to address the key issues that eSports and other online gamers and players in India face,” explains Shivani Jha, Tech Policy Lawyer, and Director of EPWA.
Shivani is a lawyer who has been working in the legal and regulatory space for almost a decade. “There was a huge policy gap. So the idea was to create a think tank or an organization that puts forth user issues,” explains Shivani. “Over the last two years, EPWA has evolved to become a very inclusive group.” When Shivani and her team began EPWA, they were mostly lawyers and “esports players,” as she calls it. In this case, an “esports player” is defined as a person who either plays online games like Dota 2, CS: GO, Call of Duty, etc. Eventually, we noticed cross-gaming across platforms from players which included poker/rummy or even fantasy chess and casual games. The issue here is that under the law they are all ‘users’, and the companies are ‘platforms’, the format on which a user plays, is eventually ceasing to matter.
“Over a period of time, we realised that there are a lot of non-traditional esports players who want to be our members or who have approached us for a solution to their legal problems” says Shivani. EPWA now has over 18,000 members from 24 states across India. EPWA members include esports pros like Moin Ejaz, Team India’s Dota 2 captain who led the country to a bronze medal at Commonwealth Esports Championship; India’s Global Poker face Muskaan Sethi; chess pro Ankit Rajpara; to name a few.
Shivani proceeds to explain the wide gap in communication between gamers and lawmakers. “We’ve had esports players have issues with existing bodies or poker players’ issues with platforms come to us. They have all faced some or the other issue in the absence of a regulatory framework. This includes criminalisations and bans in states. With the self-regulatory bodies coming up which will provide online solutions to users within 15 days of complaints, users may have some relief.”
“We’ve had esports players have issues with existing bodies or poker players’ issues with platforms come to us. They have all faced some or the other issue in the absence of a regulatory framework. This includes criminalisations and bans in states.”
Shivani Jha – Director, EPWA
When asked about what the process of solving an issue is, Shivani explains: “So in terms of trying to solve problems, we take as much as we can. These things happen through the regulatory dialogue and not by individual problem-solving.” EPWA along with players, teachers, parents and child rights experts have participated in stakeholder meetings where a lot of player concerns were heard.
“EPWA has been involved in sending representation to state governments as well as the centre to ensure players do not face criminalisation and are not treated as gamblers as per state laws. it’s essential that user safety remains the center of these online gaming regulations that have just come into place.”
When asked about how tech and gaming savvy the policymakers in our country are, “now they’re very savvy. They either have experts on their panel that understand this space, and if they don’t understand, they admit it and try to learn and pick it up. But don’t forget that these are real people, and they have at least one person around them playing games or glued to online gaming. It seems they are first-hand aware of the problems faced by users.”
One of the major issues faced by the government is people playing on offshore platforms and non-registered platforms advertising themselves as legit places to play, as Shivani describes. “The government also wants to encourage gaming, PM Modi in his speeches envisions a digital India which includes mobile gaming. We have the talent to create the next best gamers and even games. There is a push to encourage investments, keeping this in mind even the AVGC (Animation, Visual Effect, Gaming and Comics) committee has been set up that encourages animation, visual effects, gaming and comics.” The AVGC sector is considering a very important entity by the government in the Media dna Entertainment sector.
“There is a surely discouragement towards offshore gambling apps posing as gaming.” This is a pretty serious and legit problem, and as far as iLLGaming is concerned, this needs to be countered with resolve and speed. “To operate in India legally, offshore companies need to have three compliance officers based in the country, plus a registered office. Next, they need to be verified by a Self Regulatory Body as a permissible online game” explains Shivani.
The government also wants to encourage gaming, PM Modi in his speeches envisions a digital India which includes mobile gaming. We have the talent to create the next best gamers and even games.
Shivani Jai – Director, EPWA
Speaking purely from a gamer’s perspective, gone are the times when you could enjoy unregulated access to gaming. It was only a matter of time before the authorities stepped in. In a way though, some regulation is needed to protect both the player and the organizations involved. Any industry, if not regulated the right way, becomes a haven for predatory practices and that needs to be stopped.
Taxing an industry has always been a government’s stepping stone for regulation. The gaming industry recently fell victim to this, with the infamous announcement of a 28% GST levy to gamers. “With so many regulatory and judicial developments in the sector, it seemed obvious that the GST Council will not tax gamers at par with the gamblers. However, the way the minutes of the meeting read, it is unfortunate that there is no protection for users. This development indicates an increase from 1.8 rupees per 100 rupees spent on a game to 28 rupees per 100. This will not only discourage players from playing, but the professionals for whom it’s a livelihood will be burdened by taxation. This may not even spare entry amount on the tournament fee” claims Shivani.
Shivani’s views are in line with the views of the majority of this industry represented both by users and business owners. Such heavy taxation, as echoed by the industry leaders, seems uncalled for and will discourage both gamers and investors.
Update: Since the interview conducted on July 5, 2023, EPWA has also applied to be a self-regulatory body on July 6, 2023
