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Tuesday, February 7, 2023

Peeling The Onion Of Tamil Nadu’s Latest Law on Gambling and ‘Games of Chance’

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Exhausting the Grey Areas: The Latest Updates on Tamil Nadu’s Law on Gambling and ‘Games of Chance’

In October 2022, the state of Tamil Nadu outlawed online gambling, including rummy and poker. Three weeks later, an ordinance replacement measure was approved by the state, although it has not gone into effect until the time of this publication.

Objections To The Current Legislation

On the one hand, the state law’s minister emphasised that no comprehensive ban has been suggested, thus abiding by the doctrine of proportionality. “Games are not entirely forbidden,” he said. “They can be classified as games of skill or games of chance, and only online gambling is prohibited.”



However, this claim did not go down well with the All India Gaming Federation (AIGF), which filed a constitutional challenge against the legislation soon after it was announced. Their main issue with it is that some criteria for prohibiting online games of chance may also ban online games of skill. 

Because really and truly the line between what classifies as a game of luck and a game of skill is rather blurred. It is true that the former games are entirely dependent on chance whereas players need to use their talent, technique and experience for games of skill. However, to illustrate, although claiming to be a game of skill, most online games are greatly dependent on luck. At the same time, it is also true that players of all skill levels need to use some form of skill or technique when playing blackjack, rummy or poker with no deposit bonuses attached to them. This is why the Governor’s claim is not as straight-forward as it may sound. 




The Online Gaming Authority

The Tamil Nadu government suggested establishing an Online Gaming Authority, which would exercise the powers conferred by said ordinance. This Authority was thought to serve as a regulator of online games by determining games’ time limit and money limit while imposing the necessary restrictions on all online games. Playing any online game in contravention of the regulations will be punishable with three months of imprisonment, a fine of Rs 5,000, or both.   

The ordinance also requires online game providers to obtain a certificate or registration from the TN Online Gaming Authority for providing any gaming service. Failure to do so would be punishable with three years of imprisonment, a fine of Rs 10 lakh or both. 

The reason why online providers are being treated differently than land-based operators was clarified in an Explanatory Statement which argued that when participating in an offline setting it is possible to know with who one is playing and how the game is being played. On the other hand, with online games “there are chances for cheating and money laundering as the game is played based on a (computer) programme written by the creator of the game”. It was further emphasised that online games are more addictive and may bring about negative consequences on people, especially children.  




Further Points of Contention

PRS Legislative Research contested this explanation, claiming that there is no evidence to prove that this is applicable to all types of online games.  Furthermore, it was argued that the need for all online games to be registered may not meet the test of proportionality, which requires that the lowest level of restrictions be imposed to meet any valid objective.

The Current Position of The Tamil Nadu Government

However, Governor R N Ravi backed up the Government’s position with legislative evidence:




“the proposed Act is within the ambit of the Constitution, and has been framed considering the entries in List 2 of the Seventh Schedule of the Constitution. The power of the state government on making laws on gambling can be traced to Entry 34 List II of the Seventh Schedule of the Constitution on betting and gambling: public order, public health, theaters and dramatic performances.”

Law Minister Raghupathy further corroborated the Governor’s claim by adding: “This Act is not against the Constitution. This draft law to ban online gambling is constitutional.” 




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