The rule prohibits online games including betting and wagering, as well as “any act of risking money, or otherwise on the uncertain outcome of an event, including on a game of skill,” which went into effect late Tuesday.
Following a prohibition on online gaming in Karnataka, the Sequoia Capital-backed Mobile Premier League (MPL) was among the first several gaming businesses to begin limiting access to customers on Wednesday.The latest prohibition has heightened fears that rising state rules could strangle India’s young but expanding gaming industry, where international investors have poured millions of dollars into the country in recent months.MPL’s gaming app sent out messages to Karnataka users on Wednesday morning, saying: “Sorry for the inconvenience! “Your state’s law prohibits you from participating in Fantasy Sports,” “Fantasy games are locked,” and “cash games are locked.”
Fantasy cricket and football games are available on the casino app, with real-money wagering available. Paytm First Games was still active, but Dream11, one of India’s most popular gaming apps supported by Tiger Global, was not. MPL and Paytm did not answer right away, while Dream11 declined to comment.After Telangana and Andhra Pradesh, Karnataka, home to some of the world’s largest digital businesses and India’s tech capital Bengaluru, is the latest state to outlaw such online games. Tamil Nadu had enacted similar legislation, but the bill was overturned by the state’s high court.These states are essential for the gaming business, according to an industry source who told Reuters earlier that they account for around 20% of total sales for businesses.
“The industry will oppose this in court and seek legal remedies,” said Roland Landers, CEO of the All India Gaming Federation.Two other industry insiders told reporters on Wednesday that the new Karnataka rules would be challenged in court by gamers and some businesses. The rule, which imposes steep penalties and prison terms for violators, was enacted in response to rising fears that online gaming platforms, like gambling, are addictive and can lead to financial ruin.
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