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On Monday, September 26, the Tamil Nadu Cabinet approved an ordinance to ban online gaming in the state. Once approved by the Tamil Nadu governor, the ordinance will be promulgated in the state, making all online games for stakes illegal.
The development comes after the Supreme Court issued notice on September 9 on a petition filed by the Tamil Nadu government challenging the Madras High Court’s judgment that had struck down the state’s previous attempt at banning online games like rummy and poker played in cyberspace with stakes.
States like Telangana, Andhra Pradesh, Kerala, and Karnataka, have sought to prohibit games of skills. However, the High Courts of Karnataka, Tamil Nadu, and Kerala have struck down such amendments to legislation banning online skill gaming as unconstitutional.
If the headline feels like déjà vu, there is a reason for that. Let’s do a quick recap of what has in happening in Tamil Nadu’s online gaming sector.
About two years ago, on November 2020, Tamil Nadu Governor Banwarilal Purohit promulgated the government-approved ordinance banning online gaming. A hard-fought legal battle subsequently unraveled in the High Court.
The Tamil Nadu Gaming and Police Laws (Amendment) Act 2021 was introduced and passed in February 2021. Game operators and other industry stakeholders challenged the law in the Madras High Court in July. A month later, on August 3, the first bench of the Madras High Court passed a historic judgment delivered via video conferencing, striking down the blanket ban for being ‘excessive and disproportionate.’
The joy was short-lived as the very next day, State Law Minister S. Regupathy stated that public interest was more important than regulating real money online gaming. He clarified the government’s intentions, saying that a law banning online games like rummy would be tabled soon, following due procedures and specifying valid reasons.
Last November, the Tamil Nadu government moved the Supreme Court against the Madras High Court’s order that struck down the Tamil Nadu Gaming and Police Laws (Amendment) Act of 2021.
Amid mounting political pressure to regulate the online gaming sector, the Tamil Nadu government had set up a committee for promulgating an ordinance on online rummy, headed by Justice K Chandru, a retired Madras High Court judge. On June 27, the committee submitted its report, expectedly, towing the lines of the political consensus on the issue – and recommended a complete ban on online rummy and other online games for stakes.
In its 71-page report, the committee has stated that no skill is involved in any online games, and they invariably lead to players getting addicted to the games and, over time, getting into debt. It ruled out the possibility of regulating the games, underlining that it was impossible to do so.
Following the Justice K Chandru committee report calling for a complete ban on all online games, the Tamil Nadu government sought public and stakeholder opinion on the matter.
Sources in the state government revealed over 10,000 emails were received on the issue, with people from a broad group sharing their thoughts. This included parents, teachers, students, youth, psychologists, social activists, and online gaming operators. The initial data gathered revealed that 70% of online games were played for entertainment, and 10-15% involved money.
Among those who made submissions was Dr. Sandip H Shah, a leading psychiatrist based out of Godhra, Gujarat, who shared his research showing there’s no direct link between suicides and online gaming.
While the Tamil Nadu government was testing the waters to see if another blanket ban would be possible or if stringent restrictions could curb the online gaming industry, on September 9, the Supreme Court issued a notice on the state government’s plea challenging the Madras High Court’s August 2020 judgment. The apex court directed the case to be listed after ten weeks, with respondents, including skill-based gaming firms Junglee Games, Play Games24x7, Head Digital Works, and industry body All India Gaming Federation (AIGF), given four weeks to file their replies. The state government can subsequently file a rejoinder (if any) within two weeks.
A week later, the Supreme Court issued a similar notice to skill-based gaming companies and industry bodies on a Karnataka government plea against a similar order by the Karnataka High Court that overturned a blanket gaming ban in the state. A Supreme Court bench comprising Justice Abdul Nazeer and Justice V Ramasubramanian clubbed the Karnataka government’s appeal with the Tamil Nadu government petition. Both cases are expected to be heard jointly by a new bench.
Less than two weeks after this directive was issued by the Supreme Court, the Tamil Nadu government approved an ordinance “prohibiting online gambling” during a cabinet meeting chaired by Chief Minister M.K. Stalin at the Secretariat. Once the Tamil Nadu Governor, R. N. Ravi, promulgates the ordinance, it will be enacted into law after being passed by the Legislative Assembly; in that case, we could be looking at an encore of how things played out in 2020-2021.
Given that the Supreme Court is hearing a repeal of the previous online gaming ban, online gaming companies will likely approach the High Court for a stay on the ban until the Supreme Court makes a decision.
This is a developing story. Keep following PokerGuru for the latest updates.