The Promotion and Regulation of Online Gaming Bill, 2025 (‘Bill’), is a sweeping new central law that seeks to overhaul India’s online gaming sector. The Bill pursues two primary objectives: it prohibits any real-money stake, whether the game turns on luck, skill, or both, and bans any downstream financing, publicity, or repayment that supports these activities. Simultaneously, the Central Government signals approval of e-sports and “social” titles whose mechanics do not involve staking money, holding them up as activities that build competence and community. Rather than refining the precedent that was never clear, the Bill aims to replace the old structure with a new one.
Over the last decade, the nation’s online gaming sector has evolved from the fringes to a core pillar of the broader digital economy. Growth has been steep, driven by cheaper and wider availability of the internet, the near-ubiquity of low-cost, high-capacity smartphones, and a large and youthful base. This rapid, national-scale expansion, however, has unfolded beneath a legal framework that offers neither description nor defence.
The gaming industry has operated in a “regulatory grey zone”, governed by a patchwork of archaic, state-level anti-gambling laws, most of which were enacted long before the arrival of the internet. This has led to a fragmented and often contradictory regulatory environment, where the legality of a particular online game could change from one state to another.
Salient Features of the Bill
Key Definition:
- Online Game: An “online game” is defined expansively as any game played on a digital device via the internet.
- E-sport: Section 2(c) defines the term “e-sport”, carving out a safe harbour for online gaming. For a digital game to be classified as such, it must satisfy multiple rigorous conditions:
- It must feature direct competition between identifiable individuals or groups;
- the eventual ranking can be ascribed to a discernible degree of player expertise.
The provision further stipulates that “e-sport” activities “shall not include the deployment of gambling instruments or the offer of pecuniary or stake-driven incentives in any manner.” This stipulation elevates the classification of e-sport from an industry-generated label to an instrument of public law, removing any ambiguity that might have permitted expanding or exploitative interpretations by market participants.
- Online Money Game: The critical and dispositive clause appears in Paragraph 2(g). An “online money game” is described as any digital game in which the player “by paying fees, depositing money or other stakes in expectation of winning which entails monetary and other enrichment… irrespective of whether such game is based on skill, chance, or both”. This formulation represents a deliberate, frontal, and categorical legislative supersession of half a century of judicial exegesis. By encompassing skill-based amusements such as skill-based fantasy league, ordered rummy, and discretely structured poker within the statutory ban, the Bill erases the doctrinal substrate that had hitherto underwritten the entire regulated market. The definition in Paragraph 2(g) thus functions as the central and terminative predicate of the statutory prohibition, enabling indeed necessitating intervention by the regulators.
- Online Social Game: Section 2(i) defines “online social game” to cater the remaining casual gaming market. These are games introduced for entertainment, recreation, or skill development that do not involve the staking of money with the expectation of monetary gain. It is important to note that the definition clarifies that such games may allow access through a subscription or one-time fee, provided such payment is not in the nature of a stake or wager. This carves out a protected space for a large and vital segment of the gaming industry.
Authority on Online Gaming:
The central institutional mechanism under the Bill is the ‘Authority on Online Gaming’, established under Section 8, Chapter IV. The Central Government may, by notification, either constitute a new Authority or designate an existing authority/agency to discharge these functions.
Under Section 8(2), the Authority’s powers are expansive. It may:
- determine (suo motu or upon application) whether a particular game constitutes an “online money game”;
- recognise, categorise, and register online games, including e-sports and social games;
- issue directions, guidelines, and codes of practice binding on all persons offering, organising, or facilitating online games.
Section 8(3) imposes a statutory obligation on operators to comply with the Authority’s directions, while Section 8(4) authorises the Central Government to prescribe rules regarding the composition, qualifications, tenure, disqualification, and powers of Members, as well as grievance redressal mechanisms. Section 8(5) further empowers the Authority to respond to user complaints, thereby institutionalising consumer protection.
In sum, the Authority is envisaged as a hybrid body with developmental, classificatory, and enforcement powers centralising regulatory oversight of a sector hitherto governed inconsistently by state legislatures.
Prohibition of Real Money Game:
Chapter III of the Bill, covering Sections 5 to 8, introduces a strict and comprehensive framework designed to prohibit and shut down the operation of online real-money gaming.
Section 5 establishes the core prohibition, making it illegal for any individual or organization to offer, support, or promote online money games. The rule is intentionally broad, affecting not just game operators but also intermediaries like content platforms, tech providers, and network services. Significantly, this ban removes any previous distinction between games of skill and games of chance, meaning that former exceptions for “skill-based” games like real-money fantasy sports, online rummy, and poker no longer apply.
Section 6 states that all advertising or promotional activities for online money gaming are completely forbidden. This ban applies to all forms of marketing communication across both traditional and digital media. The law explicitly targets promotions in digital catalogues, app stores, social media platforms, and celebrity or influencer endorsements to ensure no method of publicity is overlooked.
Section 7 restricts the flow of money by preventing all financial institutions, payment gateways, and money transfer services from processing any transactions to online gaming. This order covers banks, e-wallet providers, and card networks, requiring them to actively implement measures to reject or freeze any payment related to online wagers or gaming credits.
Section 8 entails the penalties for violating the rules in the preceding sections. Anyone who breaches these provisions will face severe consequences, including substantial monetary fines and potential criminal prosecution, which will be carried out by designated authorities under the act.
Penalties and Compliance:
This Bill establishes a comprehensive compliance regime with severe penalties to deter illegal online skill gaming. It creates a high-stakes legal landscape designed to ensure only fully compliant operators can function.
Criminal Penalties: The law imposes a range of serious criminal penalties. Operating an illegal online skill game in breach of Section 5 can result in a term of three years of rigorous imprisonment and a fine of up to INR 1 crore. Advertisers who violate Section 6 face up to two years of imprisonment and a fine of up to INR 50 lakh. Financial service providers who fail to comply with Section 7 risk the same penalties as illegal operators: three years of imprisonment and a fine of up to INR 1 crore.
For those with a prior conviction, the penalties are enhanced. Repeat offenders face a minimum of three years’ imprisonment, extendable to five, and a fine of up to INR 2 crore. Crucially, violations of Sections 5 and 7 are cognizable and non-bailable, which allows for swift arrest and prosecution without the possibility of bail.
Officer Liability and Administrative Actions:
Company officers who oversee operations can be held personally liable and face the same criminal penalties as the company itself. Their only defense is to demonstrate they had rigorous compliance procedures in place or that the violation occurred despite their reasonable care and attention.
Beyond criminal charges, the Bill also empowers the Executive to impose swift administrative penalties. Section 12 allows for fines of up to INR 10 lakh, along with the suspension or cancellation of an operator’s license. Specific games can also be temporarily or permanently banned. To further amplify the law’s reach, the Executive can use Section 69A of the Information Technology Act, 2000, to block websites that are in violation of the statute.
Conclusion
The Bill establishes a cohesive and far-reaching governance framework through four distinct pillars.
The first pillar is based on intentionally broad definitions outlined in Sections 2(c), 2(g), and 2(i). By doing away with the traditional legal distinction between games of skill and games of chance, the statute shifts the legal focus. It designates the entire transaction as gambling, irrespective of a player’s strategic competency or a monetary stake. This ensures a comprehensive legal framework that covers every nuance of online play.
The second pillar centralizes authority through the newly constituted national Authority under Section 8, a departure from the previous fragmented state-level regulatory approach. This new Authority is not merely an arbiter; it is the architect of the entire commercial ecosystem. It is empowered to certify, supervise, and promote e-sports and social contests while simultaneously enforcing compliance and exercising adjudicatory powers over all remote gaming activities.
The third pillar, detailed in Sections 5-7, establishes a comprehensive prohibition on the promotion and provision of online monetary gaming. It mandates the removal of such content from all communication mediums and instructs banks and payment gateways to sever all related transactional pathways. This effectively dismantles the legal, social, and economic environment that had previously sustained real-money gaming, thereby recasting the entire transactional horizon.
Finally, the fourth pillar ensures strict enforcement through a rigorous system of penalties. It includes provisions for cognizable and non-bailable offences, which allow for swift arrest and prosecution. It also holds corporate directors and officers accountable for violations and establishes a system of administrative sanctions, such as the suspension or cancellation of an operator’s registration. These measures collectively create a high-stakes landscape designed to clear the field of any operations that do not strictly adhere to the statute’s conditional pathways to legality.
