Key Points

The Bill was brought in to encourage e-sports and online social games while prohibiting harmful online money gaming services, advertisements, and financial transactions related to them. The Bill seeks to completely ban offering, operating, or facilitating online money games, irrespective of whether based on skill, chance, or both.

The Bill was passed in Lok Sabha on Wednesday and in Rajya Sabha a day after. The Promotion and Regulation of Online Gaming Bill, aims to promote e-sports and online social games, while outlawing online money gaming.

There will be no punishment for those playing online money games; it is only the service providers, advertisers, promoters, and those who financially support such games who will face the consequences, said sources earlier.

Through this legislation, the government aims to promote e-sports and give them legal recognition.

This bill will help provide legal support to e-sports. Earlier, there was no legal backing for e-sports, sources said.

For the promotion of e-sports, which has been recognised as a legitimate form of competitive sport in India, the Ministry of Youth Affairs and Sports will establish a dedicated framework. The government will also promote online social games.

The government believes that the harms of addiction, financial losses, and even extreme consequences such as suicides associated with online money gaming can be prevented by the prohibition of such activities.

There were reports of money laundering and terror financing, the sources added.

Failing to fulfil the law, can attract imprisonment up to three years and/or a fine of up to Rs one crore for offering or facilitating online money gaming. For advertising money games, imprisonment up to two years and/or a fine up to Rs 50 lakh may be attracted. For financial transactions related to money games, imprisonment up to three years and/or a fine up to Rs one crore is being provided.

Any repeat offences may attract enhanced penalties, including imprisonment of three to five years and fines up to Rs two crore. Offences under key sections to be cognizable and non-bailable.

The Central government may authorise officers to investigate, search, and seize digital or physical property linked to offences. Officers would be empowered to enter, search, and arrest without a warrant in some instances of suspected offences.

Secretary, Ministry of Electronics and IT S Krishnan had earlier this morning told ANI that once the President gives assent to the Bill, a notification will follow to announce the date on which the Bill will come into effect.

"We also have to draft the rules under the bill, and issue the rules which are required to be drafted. As the bill is structured, even without rules, because the rules govern certain aspects, there are certain provisions in the bill which can come into force without the rules, but that is a decision we will take," Krishnan said.

The secretary has acknowledged that the new legislation is expected to result in some loss in GST collections. Going by estimates, the annual losses to the exchequer are expected to be around Rs 15,000-Rs 20,000 crore.

The MeitY secretary stressed that the legislation has been brought in with the larger objective of safeguarding social interests and ensuring responsible regulation of the online gaming sector.

"I think when the government has a larger social objective in mind, I think revenue loss is not the primary consideration. In any case, the bill had the approval and the consent of the Finance Ministry as well," the secretary said.

Asked when the new legislation would come into effect, the secretary, without getting into specifics, said, "We are working on it, should get it done quickly."

- ANI