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The high court for Uttar Pradesh, India’s largest state by population, has ordered the state government to create an online gaming legislative framework, potentially super-charging reform momentum nationwide.
A single justice of the Allahabad High Court on May 12 directed the Uttar Pradesh government to create a “high-powered committee” to enact a legislative framework “to meet the transformative changes in online betting and gaming”.
Legislative reform stemming from the committee’s work, in tandem with pending rulings from the Supreme Court of India on gaming taxation and online gaming legality, could gentrify online gaming in the state, which has more than 241m people.
Justice Vinod Diwakar ordered that the Uttar Pradesh government committee “examine all relevant factors … to meet out the legislative necessity arising from the transformed socio-technological [environment] concerning online betting and gaming”.
The 12-page order laments archaic elements of British-era anti-gambling legislation that remain on the books, noting the law’s loss of “impact and relevance” amid “negligible” financial and custodial penalties.
“There is a lack of clarity on the legal status of fantasy sports, poker, and e-sports. Jurisdictional issues also arise, as online platforms operate across state, national, and international boundaries,” Justice Diwakar wrote.
At the same time, the court noted the central government’s maximum goods and services tax (GST) on online gaming and gambling generally, and that this “represents a significant policy shift aimed at increasing tax revenues and standardising the taxation framework in it”.
However, the court also justified its intervention in the matter with examples of aberrant gaming, user distress and financial calamity resulting from the “psychologically manipulative algorithms” used in online gaming platforms and easy access to digital payment platforms.
“Therefore, modern, technology-sensitive legislation is urgently needed to address the psychological, social, and national security implications of online gaming,” Justice Diwakar wrote.
“Comprehensive reform must include centralised regulation, age restrictions, financial controls, platform accountability, and public awareness campaigns to safeguard the well-being of India's youth and society.
“Based upon the foregoing discussions, it's high time that a legislative framework be enacted to meet the transformative changes in online betting and gaming.”
The court’s order approvingly cites gaming regulation and two decades of “modern and adaptive” reforms in the UK, including the formation of the Gambling Commission, and commentary on developments in Australia, the United States, Singapore and South Korea.
These paragraphs in the text appear to confirm that the court interprets gaming regulation as a policy framework that accommodates gaming industry interests and is based on a constitutional right to indulge in skill gaming with stakes.
As such, the Allahabad High Court’s ruling could push the Uttar Pradesh government into alignment with major state governments that have recently embraced gaming regulation as a policy trajectory and investment boon.
These states include information technology and start-up hub Karnataka and populous Maharashtra, India’s second- or third-largest state.
Most recently, the Himalayan state of Uttarakhand, a part of Uttar Pradesh state until the year 2000, announced in April that it is preparing a Gaming Act likely to codify online real-money gaming.
These state reforms swung the national pendulum to a reformist direction after years of punitive and prohibitive legislation in Tamil Nadu, Karnataka and other states in possible violation of Supreme Court precedent.
The Allahabad High Court used a mundane appeal against a police raid of a neighbourhood online gaming operation to launch the state-wide reform process.
Two appellants with criminal records, Imran Khan and Irfan Khan, in the city of Agra, were appealing against the raid on the basis that police did not obtain a warrant.
