Tamil Nadu gaming rules upheld: Aadhaar KYC, time bans get Madras HC nod

The Madras High Court has upheld the Tamil Nadu government’s recent regulations on the real-money gaming (RMG) sector, including mandatory Aadhaar verification and a ban on online gaming between midnight and 6 am. The ruling is a major setback for several online gaming companies that had challenged the rules, Bar and Bench reported.

A Bench of Justices SM Subramaniam and J Rajashekar dismissed all the petitions filed by companies such as Games24x7, Junglee Games, Head Digital Works, WinZO, and the Esports Players Welfare Association (EPWA). The companies had argued that the rules were unfair and infringed on users’ privacy.

The court said the state has the power to regulate online games like Rummy and Poker, especially when played for real money, citing concerns over public health and suicides linked to excessive gaming. It noted that although the Centre’s IT rules on online gaming are yet to come into force, Tamil Nadu’s regulations “fill the legal vacuum”.

“The State cannot remain a mute spectator when people are facing mental and physical harm,” the court observed.

Addressing the privacy concerns raised by gaming companies, the HC bench referred to the landmark Puttaswamy judgment, which recognised privacy as a fundamental right. However, the court clarified that the right to privacy is not absolute and can be subject to reasonable restrictions in the interest of public welfare. “Though personal autonomy must be respected, it cannot override the need to protect citizens’ health,” the court added.

Key features of the Tamil Nadu rules

The Tamil Nadu Online Gaming Authority, set up in 2022, had issued detailed regulations on real-money gaming platforms, aimed at curbing excessive play and protecting users. The rules mandate:

-Platforms must block access between midnight and 6 am

-Players must complete KYC verification using Aadhaar, with an additional OTP sent to the linked mobile number

-Minors are prohibited from playing real-money games

-Platforms must let players set daily, weekly, and monthly monetary limits

-Apps must display caution messages every 30 minutes after one hour of play, and continuously show that “online gaming is addictive in nature”

-Apps must clearly display users’ total spending each time they deposit money, in “reasonably bold letters”

These regulations come after the high court had previously set aside a blanket ban on online Rummy and Poker in November 2023, allowing the state to regulate the time spent and age limits for these games, the news report said.

India’s gaming industry

India’s gaming sector is booming, with revenues rising to $3.8 billion in FY24 — a 22.6 per cent increase from $3.1 billion the previous year, according to Lumikai, a gaming and interactive media venture fund, Moneycontrol reported. Real-money gaming accounted for $2.4 billion of this revenue. The sector is projected to reach $9.2 billion by FY29, growing at 20 per cent annually.