This blog captures Ikigai Law’s interview with Mr. Rakesh Maheshwari on the amendments to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021, to regulate online gaming.
In April, Rutuja Pol (Lead, Government Affairs) and Shambhavi Ravishankar (Consultant) spoke to Mr. Rakesh Maheshwari on the online gaming amendments (Amendments) to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 (IT Rules 2021).Mr. Maheshwari was formerly the Senior Director and Group Co-ordinator, Cyber Laws and Data Governance, Ministry of Electronics and Information Technology (MeitY).
Mr. Maheshwari played a key role in the process of stakeholder consultations and drafting of the Amendments. We sought to pick his brain on the “what, why, when, and who”, of the process and what he sees as the future for online gaming and online gaming regulation in India. We also gathered his views on policymaking for emerging technologies and much more!
The interview was conducted for the April 2023 edition of Game On: India, a newsletter we publish monthly in collaboration with the All India Gaming Federation (AIGF).
Here are some excerpts of our interview.
Personal journey at MeitY:
1. What was your journey at MeitY?
I joined the Cyber Law and Cyber Security Division at MeitY 7.5 years ago. I held the Group Coordinator position for Unique Identification Authority of India and Indian Computer Emergency Response Team and was also the Head of Cyber Law Division at MeitY among other roles. I worked on various regulatory, policy and administrative matters including the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 (IT Rules 2021) and the Amendments. I worked on questions from the Parliament on information technology and played an important role in Supreme Court cases on IT.
2. How did you start working on online gaming laws?
After the IT Rules 2021 were published, several stakeholders reached out to MeitY with concerns about legality of online gaming in India. The definition of betting and gambling varies across states in India causing confusion about the legislative powers of the centre and state to regulate online gaming. Betting and gambling are regulated by states in India. At this juncture, I started working on online gaming matters.
MeitY’s approach and objectives:
1. Given that online gaming is a sunrise sector, what were the MeitY’s objectives while drafting the Amendments?
The online gaming sector has potential for immense growth. In this light, the Hon’ble Minister of State, MeitY, Shri. Rajeev Chandrasekhar, spearheaded stakeholder consultations and the process of setting out regulations for the industry. The aim was to promote the sector in a responsible, transparent, and accountable manner by introducing soft touch regulations. However, MeitY wanted to combat harms from offshore betting companies, and user harms including financial frauds.
After several inter-ministerial consultations, MeitY was given the responsibility to deal with online gaming through a formal notification in December 2022. Following that, the rule-making process began within the Indian government.
Formal and informal discussions were conducted with stakeholders before and after the draft Amendments were released in January 2023. MeitY received close to 20,000 responses in the public consultation process for the draft Amendments.
2. Did the officials at MeitY play online games while drafting the Amendments?
While, we did not have time to play online games ourselves we were able to interact with people who helped us understand the nuances of the games.
What were the issues raised by stakeholders from the gaming industry, specifically gamers and gaming companies?
Through the interaction with gamers we learnt that India is doing well in online gaming competitions and has scope to generate employment and revenue. However, there were concerns raised about offshore betting and gambling platforms and the need for effective grievance redressal mechanisms. The industry also suggested various models of regulation including introducing a light touch approach through self-regulation and centralised regulation to combat with the centre state tussle for regulatory powers.
Deep dive into the Amendments
1. Just to sort of sum up your answer, could I play poker without wagering on each decision I make for throwing my hand or changing my hand, because poker or rummy were recognized by various courts of law as games of skill?
It is crucial not to generalize poker or rummy as games of skill since the classification depends on the actual format. The specific format submitted by a gaming service provider or online gaming intermediary to the corresponding Self-Regulating Body (SRB) will be the deciding factor. If there are clear judicial decisions on a given format, they should be honoured.
2. The new rules allow MeitY to expand the obligations of OGIs providing online real money games to any free-to-play games providers in the interest of sovereignty, integrity, security or public order of the state. Can you elaborate on this?
The rules are designed to target games that could have a potentially harmful impact if left unregulated or allowed to grow chaotically. The primary focus is on real money games, particularly skill-based games, as various courts across the country have recognized the legitimacy of skill games. The majority of games, where the potential of the industry lies, are left untouched by these regulations. The rules aim to address games that pose risks to the country’s sovereignty, integrity, and security, or those that could cause public disorder.
1. Regarding the arm’s length functioning of an SRB from its OGI members, how will MeitY assess this demonstration, and what would MeitY look at or be interested to see to prove that there’s an arm’s length functioning?
The rules specifically address the issue of the board of directors (BoD), their numbers, and expertise. The board of directors is responsible for making key decisions, particularly in determining whether a game falls within the permissible definition and fulfils all other due diligence requirements as specified in rules 3 and 4. Since the board’s composition must be visible and approved by the Ministry at any given time, this should help ensure arm’s length functioning. It is crucial to ensure that the SRB remains a neutral body, maintaining an arms-length distance from the members it represents.
2. Do all board members have to be present to personally verify and assess each game? Will the BoD individually verify each game, or will sub-committees be formed for different genres of games?
While SRBs must function within the ambit of the Companies Act, 2013 as they are Section 8 companies. The BoD is ultimately responsible for the verification decisions of online games. But it would be useful to have technical evaluation committees for verification of online games.
3. Will the frameworks for verifying online games evolve over time? Will MeitY weigh in on these frameworks?
Yes, the frameworks will continue to evolve as long as they maintain the basic principles of accountability, transparency, and ensuring user safety. MeitY may weigh in on these frameworks as needed, but the experiences learned from these rules will likely be incorporated into the new Digital India Act (DIA) when it is drafted.
4. What is key to making self-regulation work?
The key factors include the reputation of the SRB, the board members’ ability to make fair decisions, the enforcement of criteria laid down by the SRB, and a robust grievance redressal mechanism. It is in the best interest of the online gaming industry to behave responsibly and ensure the success of these rules and the frameworks created by them.
What are your thoughts on the recent developments related to online gaming laws in various states?
The position about regulation is very clear. The centre will look into matters related to online gaming and the states will regulate matters related to betting and gambling. It would be beneficial if the centre and state resolved any issues which may arise amicably.
Online gaming and the Indian digital economy
Will the Amendments play a role in facilitating the USD 1 trillion economy mission?
The Amendments improve predictability while allowing for flexibility in the online gaming sector. This will be crucial in the growth of this sector and the Amendments will have a positive impact on the online gaming sector and the economy.
Policymaking for emerging technology
1. How can industries such as AI, augmented reality, and virtual reality learn from the gaming industry’s experience in policymaking?
Sectoral laws play an important role in regulating various industries. The relevant ministries can engage in stakeholder discussions to introduce effective laws. MeitY generally aims to introduce lateral laws and in this light stakeholder consultations for the DIA are ongoing. Emerging technologies like AI are likely to be regulated under the DIA.
2. Do you have any suggestions or words of wisdom for someone who’s just starting out in terms of understanding Tech policy and maybe even wanting to contribute in the future in terms of research and future developments?
It is important to understand the policies, terms, and conditions wherever professionals are working. This includes the user interface and industry interests. It is also important to study these policies and consider the audience for whom they have been written, to make sure they are easily understandable, while also being aware of the laws within which they are applicable.
Technology policy professionals should also be aware of the extraterritorial nature of laws, especially in the cyberspace, and understand how they can impact a professional’s work. This is important because one’s aspirations may not be limited to working within their own country. Knowing how different legal frameworks interact and affect professionals’ work will be crucial in their careers.
This post has been authored by Neeraja Seshadri (Associate), Shambhavi Ravishankar (Consultant) and Rahil Chatterjee (Associate) with inputs from Rutuja Pol (Lead – Government Affairs) and assistance from Shantanu Dhingra (Extern).
You can access the full interview here
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