The Tamil Nadu government has officially announced that it will be banning online gambling after the new legislation received the support of the state Governor, R.N. Ravi. A gazette notification was issued following the news, to alert the public on the new ban as well as to reveal plans to set up a panel to regulate online gambling.
The ordinance to ban online games with stakes was approved back in September by the Tamil Nadu cabinet and had been pending for several months prior to the Governor’s assent. The approved bill states that any individuals offering online gambling games or services with monetary stakes like poker and rummy will be hit with a fine of up to ₹10 lakh. The government has also stressed that carrying out these crimes could result in a 3-year prison sentence.
But it doesn’t stop there. Providers will not be the only ones who may face rather harsh penalties. As stipulated by the newly published legislation, those who indeed choose to participate in online gambling may also be punished. This applies to those who are seeking out no deposit bonus codes or simply play free online slot games. Penalties may range from up to 3 months imprisonment, fines as high as ₹5,000, or in certain cases, both.
Increased Gambling Harm
The new legislation appears to directly respond to a report published by the Justice K. Chandru Committee exposing the link between gambling addiction and suicide. The report called for the ban of all online card games, highlighting the numerous mental health issues problem gambling often leads to including depression and anxiety. In fact, within the past three years, 17 individuals took their own lives due to the negative effects of online gambling.
While the report detailed the negative impacts problem gambling can have on players’ personal lives such as going bankrupt and losing their jobs, it also revealed a worrying connection between gambling addiction and family violence. Unfortunately, it is those that care the most about the long-suffering individuals who experience physical and emotional abuse.
With the new legislation, the Tamil Nadu Government hopes to combat the rising rates of problem gambling by imposing a fine of up to ₹5,000 or a 3-month prison sentence, depending on the severity of the case. The bill also prohibits financial institutions’ payment gateways and banks from authorizing payments to any online gambling sites for games with monetary stakes.
Industry Impact
Fearing prosecution, top representatives from gaming companies have called for further clarification on the new ban in the form of frequently asked questions (FAQ). The issue lies in the fact that states often have their own varying interpretations of gambling and wagering. As such they could pass their own legislation accordingly, depending on what they deem to be a game of chance which could lead to a monetary prize.
Under the constitution gambling and betting are state subjects, which is why the new regulations put the power in their hands to decide which online games will be allowed to operate in India. While the new framework does take note of the difference between online games and those that permit betting and wagering, it’s the decision to leave “wager on an outcome” open for interpretation that has industry leaders concerned, fearing the ambiguity may lead to disputes.
Tamil Nadu Online Gaming Authority
The new ban will see the establishment of the Tamil Nadu Online Gaming Authority, which will be led by a high-ranking government official along with four additional members including a high-ranking former police officer, a technology expert, an online gaming expert and a renowned psychologist. The gaming authority will act as the governing body responsible for issuing licenses to local online game providers and for regulating online games.
Additionally, members will also need to notify the State Government should they come across any online games of chance, so they may be added to the Schedule. Like the Civil Court under the Code of Civil Procedure, the Authority will need to deal with complaints lodged against online game providers and provide resolutions.
Final Thoughts
The Tamil Nadu Government’s decision to ban online gaming could have a detrimental effect on the industry which was said to grow more than triple in size over the next four years. Additionally, with individual states being able to determine which games are deemed legal remains a point of contention due to differentiating opinions on what is classified as a game of chance or skill. All in all, it remains to be seen if the ban will have its desired effect of lowering the problem gambling rate or if it will drive players to seek out other means.
