Gaming Regulations in India: Regulating the Game of Chance
Introduction
Gambling has been in existence since time immemorial. From the Indus Valley Civilization to the Mesopotamian period, there have been ample pieces of evidence of the existence of the game. It is seen as a ‘Game of Skill’ by some and a ‘Game of Chance’ by others. It involves consideration, risks, prizes and is in itself, a GAME OF PROBABILITY.
On an international level, there is no consensus among countries on how to regulate it. Even on a national level, most of the countries have different laws in different states. Thus, the regulation of gambling on a general level is difficult. There are different types of gambling such as Casinos, Table and Electronic games, Card Games, Betting on Sports Games, Dice Based Games, Bingo, Coin Tossing, Pari-mutuel Betting and Online Gambling, which are used widely all over the world[1].
The main objective of regulating games of chance across various countries is to control games of chance, with a particular emphasis on counteracting gambling addiction, protecting consumers and preventing unlawfulness and crime. Regulatory objectives are as follows-
Ø Prevention of organised crime (e.g. money laundering, financing of terrorism and other illegal activities)
Ø Prevention of consequential crime (theft, burglary, fraud) committed by gambling addicts
Ø Youth protection
Ø Consumer protection
Ø Financial market stability (pyramid schemes)
Game of Chance in India
The majority of gaming operations in India are strictly regulated. There are a few exceptions to this rule, including lotteries as well as horse racing. In India, gambling is a state matter, hence only the state legislatures have the authority to define and regulate such operations for their own states.
The primary legislation governing gaming in India is the Public Gambling Act of 1867, usually referred to as the Gambling Act. Nevertheless, as the State governments have been given the regulating authority to create gaming laws specific to their own States under the Indian Constitution, it is actually the State that creates these regulations in accordance with its own needs.
The Gaming Act is the primary law that certain Indian states have adopted, and other governments have created or passed their own legislation to control and oversee gambling on their own soil. Since the majority of gambling laws that have been passed were passed before internet gambling and betting became common, the laws generally apply to gambling activities that take place offline.
Many Indian governments have been enforcing the gaming legislation since the days of British administration, making all types of gambling and betting illegal in each state. The only states that permitted gaming and betting were Goa and Sikkim, according to the rules set out by each of these governments.
History and Development of Game of Chance
One notable instance that leads some to conclude that gambling was used in earlier times is the mention of dice games in the Mahabharata. These were historically seen as components of human development. Gambling legislation and licensure are comparatively recent developments. Prior to it, gambling was an unrestricted form of income and enjoyment. Gambling is referenced in Atharva Vedic songs, Rig Vedic hymns, and Manu Smriti lyrics. These verses depict gaming as a source of devastation and a financial strain for the trader's clan. Many archaeological studies have shown that there was gambling among some of the primitive man.
The first gambling chip was created in Rome, another well-known location for gaming. Gambling practises and the regulations governing them have changed significantly.
People may easily gamble and place bets today using their smartphones or computers. Gambling has advanced greatly and is continually evolving, from centuries-old forms of amusement to internet gaming. States are already passing unique legislation to control internet gambling.
Constitutional Overview
The Indian Constitution gives individual states the authority to enact laws determining whether or not gambling regulations are allowed. Under Entry 34, read in conjunction with Entry 64 of List II of the Seventh Schedule, the state governments have been charged with the offence. If the Parliament does not use its authority under Articles 249 or 250, it is implied that only state governments may pass legislation governing "betting and gaming." The state governments are also given the authority to pass laws governing the imposition of taxes on gaming and betting under Entry 62.
The control or ban of forms of gambling often sparks fierce debate. Numerous proponents of gambling and businesses that profit from it are against the limits that federal and state laws have placed on these activities. These are regarded as going against the spirit of Article 19(1)(g), or the freedom to engage in any profession or business.
In a famous case from 1957 called State of Bombay v. R.M.D. Chamarbaugwala[2], the legitimacy of prize contests was at issue. The petitioners said that prize contests and lotteries are eligible to safeguarding under Article 301 and claimed that the Prize Competitions Act, 1955, violates the basic right contained in Article 19(1)(g) of the Indian Constitution.
Union Gaming Legislations
Public Gaming Act, 1867
The Public Gambling Act of 1867 is a fusion of the Irish Betting Act of 1853 and the United Kingdom's Gaming Act of 1845. The term "common-game house" is defined under Section 1 of the Public Gaming Act of 1867, and the Act specifies the penalty for the occupant or owner of the gaming house. This clause specifies what constitutes unlawful gaming. Games including playing cards, dice, tables, or other gaming equipment are illegal when they are stored or used with the intention of making money. It specifies the sanctions for in-public gambling. Additionally, anyone in control of gambling establishments faces penalties under this Act. The punishments are as follows:
1. Penalty or Cost of Owning a Gambling House
A fine of up to 200 rupees or a term of imprisonment of no more than three months, whichever comes first, may be imposed on the owner or manager of a gambling establishment. The following groups of people are penalised under Section 3: Anyone who owns or occupies a gambling establishment, is responsible for its maintenance or management, or makes investments for such uses.
2. Penalty for being found inside a Gaming House
If someone is discovered at a gambling establishment, they might face up to a month in jail or a fine of up to Rs 100, according to Section 4. In gaming establishments, it is not permissible to use dice, cards, counters, money, or other game tools.
3. Penalty for giving false personal information
A violation of Section 7 of the Public Gambling Act occurs when a person is discovered within a casino and, upon being detained by a police officer, refuses to give personal information or gives false information. A fine of Rs 500 or up to one month in jail is the maximum penalty for this offence.
4. Penalty for gambling in public
According to Section 13, the following offences are punishable by a fine of up to Rs. 50 or up to one month in jail:
· For using dice, playing cards, or engaging in any activity that isn't a game of skill on a public street for the purpose of profit or value,
· for forcing animals or birds to struggle in front of the public, for gambling on the fights or helping others place bets.
· Since gaming and betting are covered by state lists, state legislators can create laws that address them. Therefore, it is up to the state authorities whether or not to incorporate the requirements of this Act into their state statutes.
The Lotteries Regulation Act, 1998
A drawing of lots in which prizes are given to the victors among those purchasing a chance" is how a lottery is defined. The Act gives the states the authority to regulate lottery operations, from running them under their control to collecting money for the public coffers. The hereunder are some of the key elements of this Act:
· It describes lotteries as a plan in which the participants who take part receive rewards by lot or luck.
· The legitimacy of the lottery tickets must be reflected in the writing.
· The lottery activities should be run by the state legislature, and money earned from them should go into the state's general fund.
· There shouldn't be more than six bumper draws every year.
· The selling of subscriptions for lottery held in any other state may be prohibited by the state legislature of one state.
· When an agent, marketer, or dealer violates the terms of this Act, they are committing a crime that is punishable by a fine but not by posting bail. The penalty is strict incarceration for a time that may last up to 2 years, a penalty, or both.
Prize Competitions Act, 1955
The Prize Contests Act of 1955 specifies the requirements for organising prize competitions. In accordance with Article 252(1) of the 1950 Indian Constitution, this Act was passed. The maximum number of entries is 2000, and Section 4 of the Act states that the total prize money that is allowed is up to Rs 1,000 every month. The majority of states have distinct laws that address this. As a result, this Act is no longer necessary.
The Foreign Exchange Management Act, 1999
Foreign direct investments are not permitted for the operation of lotteries in India under the Foreign Exchange Management Act, 1999. Under the Foreign Exchange Regulation Act, the Foreign Exchange Management (Current Account Transactions) Rules, 2000 were passed, and they place restrictions on transactions involving outside gambling. Results available on foreign exchange are not permitted while sending lottery prizes, lottery tickets, etc. As a result, gambling is not allowed in other nations.
State Gaming Legislations
While some states have accepted the Public Gambling Act of 1867, others have created their own laws based on its structure. Many states, including Maharashtra, Gujarat, Telangana, Nagaland, and others, have passed their own unique gaming legislation.
Maharashtra and Gujarat
The 1887 Bombay Prevention of Gambling Act covers gambling regulations that are valid in Gujarat and Maharashtra. This law forbids gambling inside these two states' borders. Gaming is described in Section 3 as bets and wagers, with the exception of wagers on dog or horse races. The Act forbids common gambling establishments, and Section 4 of the Act punishes violators with a fine and up to two years in prison.
The Bombay Race Courses Licensing Act of 1912 specifies the laws for horse racing in Maharashtra. It is lawful since it is seen as a game of skill. This activity generates significant money for the state.
Lotteries are totally lawful in these states and are governed by the Lotteries (Regulation) Act, which was passed in 1998. Other activities like rummy, poker, and cricket wagering are prohibited.
Telangana
Both online and offline gaming is prohibited by the Telangana State Gaming Act of 1974. It encompasses wagering, betting, and internet gaming under its definition of gaming, which is the practise of playing games for rewards or profits. The following actions are punishable under Section 3 in the state of Telangana:
· Playing the horses,
· Speculating on changes in pricing for commodities like cotton,
· Speculating on share or stock market prices,
· Gaming in any other form in locations where there are gaming devices and the person in charge can make money out of it.
· Gaming on any wagering or betting transaction where the outcome depends on chance.
The Telangana Gaming (Amendment) Act, 2017, was also introduced with the aim of outlawing gaming activities that are bad for the interest of the public in terms of their financial position and public welfare. It serves as a zero-tolerance policy as a result. The Telangana gambling legislation was amended in 2017 to expand its scope to cover internet gaming. Additionally, the definition of "common house gaming" has been expanded to encompass the internet.
Sikkim
The Sikkim Regulation of Gaming (Amendment) Act of 2005 grants the government the authority to establish regulations for gambling in the following areas:
· The location, dates, and hours of the gaming,
· The process for issuing and cancelling gaming licences,
· Group of people who are eligible to apply for a licence, and
· Rate of licence issuance and renewal costs.
Additionally, the Sikkim Online Gaming (Regulation) Act 2008, new law enabling online gaming, was just passed. The word "online gaming" is defined under Section 2(k) of this Act as any game in which a participant plays, bargains, or wagers using a communications equipment and obtains a chance to win a prize or lottery.
Within its borders, the State has legalised online sports betting, which is permitted for those to whom a licence has been given. Those who wish to participate in online gaming may submit an application for a one-year licence in accordance with the process and requirements outlined in this Act of 2021.
Meghalaya
The basic gambling law in the State of Meghalaya is the Meghalaya Prevention of Gambling Act, passed in 1970. The Section 13 of this Act makes skill-based games permissible. "A play or game for money, comprising betting and wagering, through which a person voluntarily subjects funds to the danger or peril of losing by chance," is how Section 2 describes gambling. Lotteries, gambling, and wagering on horse races are expressly excluded from this description, keeping them lawful. According to Section 3 of this Act, the punishment for owning or maintaining a charge on a common gaming house is a fine up to Rs 1,000 or six months in jail.
The Meghalaya Prevention of Gambling Act, 1970, grants the State Government the authority to legalise sporting activities under Section 13(2). Betting on various sports is governed under the Meghalaya Regulation of Gaming Act, 2021. Additionally, the state allows wagering on teer (archery) competitions.
Nagaland
Online games are governed in Nagaland under the Nagaland Prohibition of Gambling and Regulation and Promotion of Online Games of Skill Act, 2015. This legislation defines gambling as bets and wagers on games of chance but does not include bets and wagers on games of skill. Moreover, the risking of either real or digital money has been referred to as betting or wagering. Games of skill and chance are also defined under the Act. whereas the latter describes "games where there is a predominance of chance over talent," these included "card-based and action/virtual sporting, quest or puzzle and computation, strategic, or quiz-based games." The Act's Schedule A specifically lists games of skill.
Goa, Daman and Diu
Gambling and the operation of public gaming establishments are prohibited under the Goa, Daman, and Diu Public Gambling Act of 1976. Casinos and other games of chance are not prohibited, though. The following activities take occur at the following locations, which are common gaming establishments in Goa, Daman, and Diu:
· Playing with commodity prices or market fluctuations
· Gambling on the share or stock market price, gambling on the occurrence or absence of any natural event
· Punishment for gambling at common gaming establishments is outlined in Section 4 of the Goa, Daman, and Diu Public Gambling Act, 1976. Anyone who is discovered at a public gambling establishment faces a maximum 3-year jail sentence and a fine of Rs 5,000.
Rajasthan
In Rajasthan, gambling is not allowed when it takes place in a public gaming establishment. The Rajasthan Public Gaming Ordinance of 1949 establishes gambling penalties and restricts the location of gaming establishments within the state of Rajasthan. Gambling also involves bets and wagers. However, taking part in the lottery system is authorised. According to Section 3 of the Ordinance, maintaining or owning a common gambling establishment is punishable by up to six months in jail, a fine of up to Rs 500, or both.
Tamil Nadu
The Tamil Nadu Gaming Act of 1930 and the Tamil Nadu Prize Schemes (Prohibition) Act of 1979 are the laws that govern gaming in Tamil Nadu. While the latter forbids the holding of prize competitions, the former penalises the ownership and maintenance of common gambling establishments.
Delhi
Games of chance are not allowed in Delhi, and the Delhi Public Gambling Act of 1955 governs gambling in the capital city. Gaming other than wagering or betting on horse races is prohibited by Section 2 of this statute. In accordance with Section 3, maintaining or owning a gambling establishment is punishable by up to six months in jail and a fine of Rs 1,000.
Uttar Pradesh
The most populous state in India, Uttar Pradesh, is also a centre for gambling. In Uttar Pradesh, there are numerous clandestine casinos that run afoul of the law. In addition, the state forbids playing games like poker, rummy, and flush. Horse racing is nonetheless permitted, and Uttar Pradesh is home to the biggest Indian horse racing track, the "Lucknow Race Course."
West Bengal
The West Bengal state law that governs gaming establishments and other forms of gambling is the West Bengal Gambling and Prize Competitions Act, 1957. It keeps lotteries and horse racing beyond the realm of prohibited gambling. The penalty for maintaining or operating a common gaming establishment is outlined under Section 3 of the Act and may include up to 3 years in jail as well as a fine of Rs 2,000.
Odisha
The Orissa Prevention of Gambling Act, 1955 governs gambling in Odisha, while the Orissa State Lottery Rules, 1939, provide the rules for the state lottery. There is no difference between games of skill and games of chance under the Orissa Prevention of Gambling Act of 1955. The term "gambling" is defined under Section 2(b) of the Act to include betting, betting, and other activities involving stakes or money. The word "lottery" is deliberately left out of the concept of gambling. Gambling offences are punishable by up to one month in jail, a fine of Rs. 100, or both, according to Section 4 of the Act. The maximum penalty for maintaining or operating a common gambling establishment is six months in jail or a fine.
Assam
The Assam Game and Betting Act, passed in 1970, forbids the operation of betting establishments. A "bet" is defined as wagering money or a valued security on the occurrence or outcome of any unknown event, with the exception of putting money on a lottery, under Section 2(a) of the Act. Additionally, it does not include wagers on horse racing made by a licenced bookmaker on the day the race is scheduled to take place at the racing club.
Pondicherry
The Public Gambling Act of 1867 is similar to the gambling laws of Pondicherry. The Pondicherry Gaming Act, 1965 is the law that governs gaming in this city. The Act forbids all forms of gambling, with the exception of lotteries and horse racing. The UT does not, however, run neighbourhood lotteries. All games, including as casinos, card games, sports betting, and lotteries, are performed freely on digital platforms because there is no reference of online gaming in the legislation.
Kerala
One of the earliest Indian states to legalise lotteries was Kerala. The Kerala Paper Lotteries (Regulation) Rules, 2005 govern how the lottery is conducted. Both comprehensive details regarding the lottery events and all of the instructions are included. The Kerala Gaming Act, 1960, also governs various forms of gaming. In contrast to games of chance and those including especially money or stakes, horse racing and skill-based games are absolutely prohibited by state law.
Game Of Chance Vis-À-Vis Game Of Skill
A game of skill is based on the skills and expertise acquired and honed by the individual. A game of skill offers participants the flexibility to test their athletic prowess. They are encouraged to become acclimated to a particular set of instructions while searching for methods to develop and use new techniques with routine training.
Competent players typically recognize how to apply tactics to their gaming in order to succeed. Generally speaking, a player's odds of succeeding in a game of skill are higher the more seasoned they are. Thus, consistent practise is necessary to succeed in a game of skill.
A "game of chance" is primarily decided by an arbitrary element of any kind. Even when talent is used in games of chance, victory is still mostly determined by probability. While the majority of chance-based games rely on fate, other games, like poker, also require some amount of ability to win. Games of chance typically need less professional expertise, making them simpler to master.
Undoubtedly, there are aspects of chance and components of skill in any game. The main conclusion that must be reached in order to establish if a game is a "game of chance" is that the factor of luck outweighs the portion of ability[3]. Therefore, a game of chance is one where the result is decided by luck instead of ability[4].
Any game of skill and a game of chance differ significantly from one another. The first distinction is "who" the aforementioned person is competing against. If the alleged player is competing against the establishment, they are playing a game of chance. On the contrary, it is considered to be a game of skill when the participant is up versus opposing competitors. Additionally, a game would be labelled as a game of skill if someone could conclusively show that it relies mostly on abilities like arithmetic, analytics, and strategy, with a tiny bit of randomness or chance.
The Debate
There have been several discussions between lawmakers and gamblers over the legality of games of chance in various parts of the world. Games of chance nearly always need some amount of ability to play, according to advocates of legal gambling, thus they ought not be viewed as prohibited.
It's important to note that many academics have researched chance in relation to gambling and the way a player may change specific variables to increase their odds of winning, which many people view as a type of skill.
However, lawmakers look at the adversary of the player to decide if a game is skill-based or random. Any game in which the player competes against the house is dependent on chance. However, the game is categorised as a skill-based game when the participant is competing against other players. A game employing fortunate numbers is not regarded as a skill-based game, but those that need strategy and cognitive skill sets like arithmetic acumen may be.
Judicial Overview
Numerous lawsuits have been brought by associations involved in gaming to designate these activities as games of skill so that they can acquire legal standing and never be considered unlawful. However, when the Hon'ble Courts are asked challenging questions, a response to such queries is given along with an articulate justification of their view of that particular issue. The Courts have occasionally carefully considered the relative weights of chance and skill for each game to find which one predominates and if placing a wager in such games would constitute gambling.
It has been ruled that the facts and conditions unique to each case should be weighed when determining whether a game is regarded to be one of skill or chance[5].
The Hon’ble Supreme Court explained the distinction between the three-card game "Rummy" and "Teen Patti," holding that while the aforementioned was a game of pure chance, the other needed a specific amount of skill because one had to remember the order in which the cards fell, and the accumulating of Rummy necessitates significant skill in deciding which cards to retain and which ones to toss away. The Apex Court concluded that rummy qualifies as a game of skill since it is played more often[6].
When the subject of horse racing came up, the Hon’ble Supreme Court ruled that it should not be classified as gambling or gaming but rather as a game of "mere skill," where "mere talent" refers to a significant level or preponderance of competence. This was construed in this way on the assumption that horse racing is determined by the innate potential of the horse, the expertise and aptitude of the rider, the shape and general stamina of the horse, the load it can hold, and the range of the race; all fair factual information that can be evaluated or researched by racegoers. As a consequence, it was decided that talents rather than random chance were responsible for the forecast of the race's outcome[7].
In relation to the game of poker, the Hon'ble High Court of Karnataka noted that it is a game of skill and that, when played in compliance with the rules established by the State, no licence is needed to perform a game of skill, which would also include poker, on property intended for leisure activities[8]. It was further reiterated that poker is not considered a form of gambling in the West Bengal Gambling and Prize Competitions Act of 1957 and therefore law enforcement officials are not allowed to meddle with such games.
The Hon’ble Gujarat High Court, however, held a different perspective[9]. Poker has been deemed a "game of chance" by the Supreme Court in the wake of its ruling in the K. Satyanarayana case. The same Court is still considering an appeal of this judgement, nevertheless.
The debate over whether poker is a skill-based game or not continues to this day, and in many jurisdictions, playing poker online is seen as illegal. The game has even been altered by a number of service operators and internet resources to make it a more difficult game. To support this, several websites removed the element of chance from the game; as a result, the players' talents have become more important in deciding the game's victors.
International Perspective
While implementing gambling laws, it becomes crucial to examine the region and state where it is being applied to as the cultural differences among regions create disorientation and it is difficult to implement a uniform law for the whole country. This is the reason why there are different gambling laws within a country that varies from state to state. In countries like the USA, European Union and India[10], it has become a common rule that the gambling rule changes from state to state or country to country in case of the EU.
In countries like Japan, gambling was illegal for a long time but recently betting in sports activities has been legalised and various casinos have also been opened. What is interesting to note is that there are some countries where gambling of any kind is strictly prohibited such as the United Arab Emirates and Brunei because the concept of gambling goes against the culture and ethics of the country. North Korea also doesn’t allow for any kind of gambling, however, it is allowed for tourists with guided tours.
It's noteworthy to know that Indian nationals are not subject to any restrictions on websites relating to overseas gaming. However, there are problems with these sites' currency conversion. Each nation has a unique stance on the legalisation of gambling. Others enforce a full prohibition on these games, classifying them as immoral pursuits. Some nations view gambling as a kind of business and trade and permit it within their national borders.
The United States Of America
There are federal laws in America regulating gambling, and the states and locals also have their own laws for the same. The Indian Gaming Regulatory Act, 1988 gives the right to Native American Tribes to regulate gaming on their lands. It is a federal law which restricts the boundaries of such games, if it is prohibited by the criminal law, as opposed to public policy or any other federal law.[11]
Another federal law which expresses the regulation of online gaming is the Unlawful Internet Gambling Enforcement Act of 2006. The Act focuses on the financial transactions being sought for the use of gambling business and regulates them for any such use of online gambling. Another important Act is the Interstate Wire Act, 1961 which prohibits interstate betting by use of a wire communication facility for any betting game or sports event but exempts it if it is legal in both the states where the money is being transferred to.
Canada
Gambling in Canada is regulated on the Federal level by the Criminal Code of Canada. According to the law in Canada, gambling of any kind is prohibited but there are certain exceptions to the same. Section 204 of the said Act provides for certain exemptions such as betting on lawful races or sports games and pari-mutuel system on running or trotting.
The Ministry of Agriculture and Agri-Food has the responsibility to regulate such bettings as has been prescribed. Furthermore, Section 207 of the said Act provides for lotteries to be lawful if regulated by the Government. Other than this, there are separate laws for each State such as Ontario has laws regulated by the Ontario Lottery & Gaming Corporation Act, 1999 and New Brunswick regulates it by Gaming Control Act.
Mexico
In Mexico, gambling is regulated by the Gaming Regulations. It regulates all gambling games and is governed by the law except the National Lottery, which is ruled through its own regulation.
European Union
The European Union works as a one-state in certain matters but in the case of gambling, there is no specific legislation or regulation that provides for laws concerning the same. There is only one specification, that is, every country of the EU has to comply with the provisions mentioned in the Treaty on the Functioning of the European Union (TFEU).
There are provisions which provide for the functioning of businesses in any country of the European Union. There are fundamental freedoms provided under the Treaty which have to be complied with. Other than that, the type of games which have to be regulated within a specific country is at the discretion of that country.
Some countries are restrictive in nature and only allow poker or casinos. While some are regulating laws for online gaming as well. In France, the regulations are governed by different laws for horse racing, betting and online gaming. In Germany, there has been no structural consensus on a variety of factors and there have been questions about the monopoly of gambling. Where the various countries in the EU have been so strict in regulating online gaming, Italy has been very liberal about the same.
United Kingdom
The UK has been much standardised in regulating gambling and making provisions for the same; the major Act regulating it being the Gambling Act of 2005. There are specific and very strict laws that provide for different types of games. The laws are made with an objective that such games do not give rise to crimes in the country. The Act also establishes a Commission to oversee the activities of gambling and the provisions of licensing as well.
The Gambling Act of 2005 defines "gambling" as include gaming, betting, and taking part in a lottery. "Playing a game of chance for a reward" is what gaming refers to. Additionally, it defines what a "game of chance" is. It claims that regardless of whether there is exceptional ability present or not, any game with a component of luck qualifies as a game of chance. But it expressly leaves sports outside of its purview. Making or taking a wager on the possibility of something happening or not happening, whether something is genuine or not, or even on the result of a racing, contest, or other event is referred to as wagering.
Apart from it, there are other legislations that concentrate on specific types of games such as Horserace Betting & Olympic lottery Act, 2004, Categories of Casino Regulation, 2008 and Gambling (Licensing & Advertising) Act, 2008. There are various other regulations that provide a structured pattern to the regulations of gambling in the UK.[12]
Australia
In Australia, there is a federal law for gambling and every State has its own separate regulation for such games. The Interactive Gambling Act, 2001 is the federal law that governs gambling in Australia. It provides for regulations to licensing as well as to online gambling in Australia. The Act lays emphasis on legal gambling by way of licensing and excluded lottery service. Apart from it, every State has its own regulation for gambling. This Act defines "gambling service" as any betting, lottery, lottery winner, or gaming provider that requires money or other compensation and where the outcome is determined by chance or skill.
For example, Victoria has the Casino Control Act, 1991 and Gambling Regulation Act, 2003 among other laws. Similarly, New South Wales has Betting & Racing Act, 1998 and Casino Control Act, 1992 among other acts as well. Therefore, in consonance with the federal law on the Central level, gambling is regulated majorly on State level by rules made by the respective States.
South Africa
South Africa's National Gambling Act, 2004, governs gambling, and it describes a "gambling machine" as any electrical, mechanical, or audio-visual equipment that is performed in exchange for money or that is utilised as a mode of payment amongst users or administrators. Additionally, the phrase "gambling games" as used in the Act applies to any activities that necessitate the provision of a contribution and result in monetary gain or loss for the participant. The outcome of the game is determined by the player's ability, chance, or both.
Conclusion
In order to determine the legality of any game, especially when played for real money, a determination of whether such game will contravene any applicable Gambling Legislations will need to be made. Given that most online games are played with real money, it is important to determine whether the Game is a ‘Game of skill’ or ‘Game of Chance’ (since games of chance when played for real money are prohibited across various countries). ‘Games of Skill’ mean such games which require a preponderance of skill, or where the success largely depends on the skill of the player. It does not, then matter that such games have an element of chance involved as well- so long as the success is largely dependent on the skill of the player.
Once a determination of whether a game is a game of skill or a game of chance has been made, it is important to understand which states such a game will be permitted in. Based on the analysis provided above, we believe that such games are likely to be allowed in most countries.
As is evident from what has been discussed above, the legal landscape of many countries in respect of online gaming is confusing, inconsistent and certainly not helpful for the growth of an otherwise vibrant industry. In order for such an industry to prosper in the country, we will need to ensure that a robust, modern and consistent legal framework is developed across the country which the gaming industry can then comply with.[13]
Authors: Mansi Jha (https://www.linkedin.com/in/mansi-jha-2b2345221) and Ojaitra Arora (https://www.linkedin.com/in/ojaitra-arora-5a627b202)
[1] Vishruti Chauhan, Gambling Laws Across the World, Blog iPleaders (Aug 17, 2020)
https://blog.ipleaders.in/gambling-laws-across-world/#Different_laws_over_different_regions
[2] 1957 AIR 699
[3] Shri K.L. Mansukhani v. Senior Inspector of Police & Ors., 1999 SCC OnLine Bom 843
[4] Black’s Law Dictionary, 6th Edition
[5] Manoranjithan Manamyil Mandram v. State of Tamil Nadu AIR 2005 Mad 261
[6] State of Andhra Pradesh v. K. Satyanarayana AIR 1968 SC 825
[7] Dr. K.R. Lakshmanan v. State of Tamil Nadu (1996) 2 SCC 226
[8] Indian Poker Association (IPA) v. State of Karnataka (2013) SCC OnLine Kar 8536
[9] Dominance Games Pvt. Ltd. v. State of Gujarat (2017) SCC OnLine Guj 1838
[10] Gowree Gokhale, The Curious Case of the Indian Gaming Laws, Nishith Desai Associates (Oct 23, 2019) http://www.nishithdesai.com/fileadmin/user_upload/pdfs/Research%20Papers/The_Curious_Case_of_the_Indian_Gaming_Laws.pdf
[11] DUCHARM S. (Nevada), CATANIA F. (New Jersey), PATTON C. (Mississippi), TURNER G. (Colorado), RYDER M. (Illinois) “NATIONAL GAMBLING IMPACT STUDY COMMISSION REPORT” 3.1-3.27
[12] The Gambling Act, No. 19, Acts of Parliament, 2005 (UK)
[13] Brian L. Glassberg, So You Think the Government Can't Regulate Internet Gambling? Don't Bet On It, Cyber Harvard
https://cyber.harvard.edu/fallsem98/final_papers/Glassberg.html