Karnataka Govt’s Bill banning online games ‘non-progressive’: IAMAI

Internet and Mobile Association of India (IAMAI) has said that the Karnataka Police Act (Amendment) Bill, tabled in the State Legislative Assembly, will provide a conducive environment for the online skill gaming industry. However, the Bill introduced in the Assembly appears to have been drafted without considering the various legal and constitutional positions by including a wide definition of ‘gaming’ in amendments against various Supreme Court and High Court judgments.

The Bill has been introduced in the backdrop of a PIL filed in Karnataka High Court to ban online gambling. After the Cabinet approval of the Bill, Law Minister JC Madhuswamy informed the media that the Bill is to ban online gambling and games of chance in the state.

IAMAI is of the view that the Bill may hurt Karnataka’s position as the country's start-up hub and lead to the loss of jobs and revenue for the state. There are 92 gaming companies registered in Bengaluru, which employ over 4,000 people. In the past three years, international investors have invested around Rs 3,000 crore in gaming and animation start-ups in the state.

Karnataka is often recognised for its several exemplary initiatives in developing futuristic policies to support new and disruptive technologies and having a regulatory framework conducive to start-ups working in emerging technologies. Karnataka was one of the first states to come up with an AVGC (Animation, Visual Effects, Gaming and Comics) policy, recognising the immense potential the sector holds for the digital economy.

IAMAI is hopeful that the state government will continue to take a progressive stand and relook at the bill to bring it in line with the Supreme Court and various High Court’s judgments and help create a vibrant, inclusive, globally competitive, and sustainable start-up ecosystem in Karnataka.

Legislative actions such as this may create a cloud of confusion and create regulatory uncertainty, which may unintentionally result in investors recalibrating their investments in the state and many existing companies may consider shifting base from the state. Hence, IAMAI has requested the Government of Karnataka to take a progressive view and ensure that legitimate online gaming companies, which are protected under Article 19(1)(g) and Article 14 of the Constitution of India, continue to operate in the State.