Online gaming: Regulation, not bans, is key to protecting users and curbing illegal activities
The Promotion and Regulation of Online Gaming Act, 2025, aimed at protecting vulnerable populations, is proving counterproductive, leading to a rise in offshore online betting and gambling. Studies show a significant shift from regulated domestic platforms to illegal offshore ones, which circumvent laws and facilitate money laundering and terror financing. These offshore platforms use advanced evasion tactics like VPNs and encrypted channels, making effective regulation difficult for domestic authorities. The article highlights that paternalistic bans rarely change consumer behavior but instead push users to unregulated channels. Drawing parallels from the UAE and Sri Lanka, which are moving towards regulated licensing frameworks, the author advocates for a strong domestic regulatory framework with accountability and consumer safeguards to address the menace, generate tax revenue, and fund awareness campaigns.
Key Points
- The Promotion and Regulation of Online Gaming Act, 2025, intended to protect users, has inadvertently led to a surge in illegal offshore gaming.
- Offshore platforms facilitate money laundering and terror financing, using VPNs and encrypted channels to evade domestic oversight.
- Blanket bans are ineffective as they merely shift user activity to unregulated and more volatile channels.
- International examples from UAE and Sri Lanka demonstrate a shift towards regulated licensing frameworks for online gaming.
- A robust domestic regulatory framework is essential to protect consumers, ensure accountability, generate tax revenue, and fund enforcement and awareness.
Exam Facts
- Promotion and Regulation of Online Gaming Act, 2025.
- CUTS International study found increased offshore participation (e.g., 68.3% to 82% in Delhi NCR).
- Ministry of Electronics and Information Technology blocked 8,376 URLs.
- UAE moved to a federal licensing framework in 2023.
- Sri Lanka expects a Gambling Regulatory Authority by June 2026.
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