India’s online gaming market enters new era
Nalini Jain, co-founder of Pokabunga.com, one of India’s leading poker sites, explains how igaming is set to enter a new, licensed era in this major market.
The Legislative Assembly of the State of Nagaland in India recently passed the Nagaland Prohibition of Gambling and Promotion and Regulation of Online Games of Skill Bill, 2015, which was signed by the Governor of the State of Nagaland on 7 April 2016.
The Act now makes Nagaland the first state in India to regulate the online skill gaming industry and is viewed as landmark legislation with regard to the regularisation of the igaming market across India.
With an internet user-base of more than 400 million and more than 1.2 Trillion Rupees (£12.8bn, €15.9bn) already being transacted in the digital payments space, this opens ups the road for a more regularised, transparent and monitored growth of the igaming sector in India, which is exploding at a highly accelerated rate in line with the rest of ‘digital India’.
The legislation comes at a highly opportune time because poker has been classified as a game of skill. This brings more clarity to the skill games vertical in India.
While states such as West Bengal and Karnataka in India have their own laws allowing poker and other real money games, the licence granted under the Nagaland legislation is envisioned to clearly regulate all games of skill; including online games like poker, rummy, war games, fantasy sports, racing, strategy games, options trading and so on across India.
The legislation also envisages setting up an expert committee to evaluate new games which could qualify as games of skill and evolve best practices and player safety regulations to regulate the ecosystem.
The rules for regulating the legislation are in the process of being drafted and should be finalised in the next few weeks. According to sources the roll out of the first phase of licences could happen in the next three to four months.
It is assumed, however, that they are likely to include strong terms regarding the controlling interests and operations of any entity engaging in this business to be held within the territorial boundaries of India.
It is expected that the notification of the rules and the roll out of the first phase of licences will happen before the end of the year.
The existing poker or rummy operators in the Indian igaming market welcome this legislation and the competition is expected to heat up soon with more players now being drawn into this segment.
However, there is expected to be significant sifting of the market separating the serious and compliant players from the fly-by-night operators.
Vaibhav Gaggar, managing partner of Gaggar & Associates law firm, is the chief legal consultant on the legislation.
He recently commented that a Nagaland licence will allow players across India to play for real money, as games of skill are legal across all states of India except Orissa and Assam. The legislation simply defines what qualifies as a game of skill and helps in regulation for best practices.
It is clear that the Nagaland Act represents a landmark piece of legislation following a number of positive judgments with regard to the regulation of the skill games industry in India.
The hope now is that the betting market will soon be the next vertical to become regulated.
Related article: India legal update: sports betting and skill games