Karnataka passes a bill banning online “gambling”; The CAIT calls this a “setback for startups”

In order to ban virtual gambling and limit online gambling, the Karnataka Assembly adopted the Karnataka Police (Amendment) Bill, 2021. The bill, introduced by the Minister of State Interior Araga Jnanendra is following several complaints about cyber fraud.

The bill specifies that “games designate and include online games, involving all forms of betting or betting, including in the form of tokens valued in terms of money paid before or after the issue thereof, or electronic means and virtual currency, electronic transfer. of funds in connection with any game of chance. The draft law amending the Karnataka Police Act of 1963 does not include lottery, betting, betting on horse races at racetracks inside or outside the state.

The bill recently passed by the Karnataka Assembly includes the use of cyberspace (computer resources or any other communication device) as defined in the Information Technology Act, 2000 in the game process to curb online gambling and gambling via the Internet and mobile applications. The bill also provides for an increase in penalties of up to three years of sentence and a fine of up to Rs 1 lakh.

According to this bill, the penalty for the first offense will be 6 months imprisonment and Rs 10,000 fine and one year imprisonment and Rs 15,000 fine for the second. In the event of a third offense, the penalty will be 18 months imprisonment and a fine of Rs 20,000. Those who help with such online gambling will also be punished.

Pressure from the Karnataka government against online gambling and gambling may impact locally developed online gaming platforms, such as Dream 11, Mobile Premium League, Games 24×7 and several others. The General Secretary of the Confederation of All Indian Traders (CAIT), Praveen Khandelwal, urged Karnataka Chief Minister Basavaraj Bommai to reconsider the decision as it may turn out to be a “setback for Indian startups”.

“Sir, the bill will harm the Indian startup sector, the Indian gaming and animation industry and millions of Indian gamers and esports players across the country. This will lead to massive job losses in Bengaluru, where over 90 small Indian game companies are registered, which employ over 4,000 people, and will also have an effect on various other developers and animation studios, ”Khandelwal said. in his letter to Karnataka. CM.

The letter further read: “Unfortunately, the Karnataka bill does not distinguish between a game of skill and a game of chance. Gambling is pure gambling and should be legitimately banned. However, by including games of skill within the scope of the bill, this not only goes against the established jurisprudence of the Honorable Supreme Court and the High Court of Karnataka, but threatens the industry. flourishing gaming startups in India.

Edited by Mehak Agarwal; with contributions from the agency

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