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Both the lower and upper houses of parliament, the Lok Sabha and the Rajya Sabha, have passed the Promotion and Regulation of Online Gaming Bill, 2025, introducing a comprehensive framework that both promotes e-sports and social gaming while imposing a blanket ban on money-staked online gaming. The Bill is significant for a number of reasons discussed in this article, and particularly because it criminalizes promotional and sponsorship activities linked to online money games.
Legislative Background
The Bill was introduced in response to mounting public concerns over the rapid expansion of online money gaming in India. Reports of addiction, suicides linked to financial losses, and instances of fraud and money laundering prompted a national-level intervention. Until now, regulation of gaming in India has been fragmented, with different States adopting different approaches, often leading to contradictory court rulings. The new Bill aims to establish uniform rules under central law.
Scope of the Bill
The Bill applies to both domestic and international operators, covering any platform accessible in India. Its extraterritorial reach means global companies with India-facing services cannot avoid compliance by operating offshore.
The Bill creates three distinct categories of games:
- E-sports: Defined as organized, multiplayer competitive events conducted in physical or virtual environments, recognized under the National Sports Governance Act, 2025. These events must be registered with the designated Authority or agency and cannot involve betting or wagering.
- Online social games: Games offered for entertainment, education, or skill development purposes, provided they involve no monetary stakes or expectation of winnings. Charging a subscription or access fee is permitted, but these fees must not operate as stakes.
- Online money games: An online game, irrespective of whether such game is based on skill, chance, or both, played by a user by paying fees, depositing money or other stakes in expectation of winning which entails monetary and other enrichment in return of money or other stakes; but does not include any e-sports
Section 5 of Bill prescribes,"No person shall offer, aid, abet, induce or otherwise indulge or engage in the offering of online money game and online money gaming service." Thus, the Central Government intends to implement a complete ban on the operation and offering of online real money gaming platforms in India, irrespective of whether the game is based on skill or on chance.
Section 6 of the Bill prohibits the making, causing to be made, aiding, abetting, inducing, or otherwise be involved in the making or causing to be made any advertisement which directly or indirectly promotes or induces any person to play any online money game.
Section 7 of the Bill further specifies that banks, financial institutions or any other person facilitating financial transactions or authorization of funds shall not be permitted to engage in, permit, aid, abet, induce or otherwise facilitate any transaction or authorization of funds towards payment for any online money gaming service.
Advertising Ban in Detail
The Bill's most direct impact on the advertising ecosystem lies in Section 6, which prohibits the advertisement of online money games in any form. Key implications include:
- Comprehensive prohibition: Applies across all media—television, print, radio, digital, social media, and influencer marketing.
- Indirect promotion: Campaigns that indirectly promote money gaming (e.g., through sponsorships or cross-brand promotions) fall within scope.
- Criminal liability: Violations may result in up to two years' imprisonment or fines of up to INR 50 lakh (~USD 60,000), or both.
While ASCI previously issued advertising guidelines, this is now a matter of law with criminal penalties.
For advertisers and agencies, this means rethinking client portfolios, campaign approvals, and risk assessments when dealing with gaming-related clients in India. The Bill significantly affects the endorsement ecosystem as well, creating new compliance obligations for celebrities, athletes, and influencers: Individuals endorsing prohibited money gaming platforms may be prosecuted under the Bill.
Current Scenario
The Bill is almost certain to face extensive litigation with several petitioners challenging it in the Supreme Court, particularly on two constitutional grounds:
Skill vs Chance Jurisprudence
For over a decade, Indian courts have drawn a distinction between games of skill (protected under the constitutional right to carry on trade) and games of chance (prohibitable as gambling). In State of Andhra Pradesh v K. Satyanarayana & Ors. and State of Bombay v R.M.D. Chamarbaugwala1, the Supreme Court specifically tested the game of rummy based on the principle of skill versus chance and held that rummy is a game of skill, unlike three-card games such as "Teen Patti Flush", which is a game of chance. Such landmark rulings and some of the more recent judgments on fantasy sports have upheld the legality of skill-based games involving stakes.
The new Bill, however, collapses this distinction by banning money games altogether, whether based on skill, chance, or a combination. This represents a significant departure from established jurisprudence and is expected to be a central ground for constitutional challenges.
Federalism Challenge
Gaming has historically been treated as a State subject under India's Constitution. States like Tamil Nadu, Kerala, and Karnataka have enacted their own laws to regulate or prohibit online gaming. By introducing a sweeping central ban, the Bill raises questions of legislative competence: does the Union Parliament have the authority to override State powers in this domain? Legal challenges are likely to argue that the Bill intrudes on matters constitutionally reserved for States, potentially setting up a significant federalism dispute before the Supreme Court.
These challenges will likely shape the trajectory of enforcement. Even if the Bill is upheld, courts may strike down or modify certain provisions, creating a dynamic and evolving compliance landscape.
Practical Guidance for Stakeholders
At this stage of uncertainty, stakeholders should adopt forward-looking compliance strategies:
- Contractual restructuring to include strong indemnities, termination clauses, and specific definitions of prohibited conduct.
- Compliance reviews for all campaigns involving gaming to ensure that none fall within the banned category of money games.
- Technology safeguards: Platforms and intermediaries may need to invest in geo-blocking and audience segmentation tools to prevent exposure of prohibited ads to Indian audiences.
Conclusion
The Promotion and Regulation of Online Gaming Bill, 2025 represents a decisive intervention in India's digital and advertising ecosystem. By banning online money games and criminalizing their promotion, the Bill imposes new liabilities on advertisers, agencies, and endorsers. At the same time, it legitimizes e-sports and social gaming, creating new opportunities for compliant sponsorships and campaigns.
India's approach is one of the strictest globally, contrasting with the UK's regulated advertising regime and the US's state-level patchwork. For global brands, this highlights the importance of jurisdiction-specific compliance: campaigns acceptable in one market may expose endorsers and agencies to criminal liability in India. For now, there is a very high chance that the Bill is going to be challenged in court.
Footnote
1. 1968 AIR 825
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
