We refer to our earlier client alert on the Promotion and Regulation of Online Gaming Act, 2025 (the “Online Gaming Act” / “Act”), which received Presidential assent on 22 August 2025 and seeks to establish a uniform national framework for online gaming by: (i) promoting E-sports and online social games (“OSGs”); (ii) prohibiting online money games (“OMGs”) and related advertising and financial facilitation; and (iii) creating a centralised regulatory and enforcement architecture.

In doing so, the Online Gaming Act marks a significant shift from India’s historically fragmented, state-led and litigation-driven gaming regime toward a centralised ex ante regulatory framework. The Gaming Rules materially reduce the practical relevance of the traditional “skill versus chance” analysis in cases involving monetary staking, and instead place greater emphasis on how value enters, circulates through, and exits an online game.

To operationalise the Online Gaming Act, the Ministry of Electronics and Information Technology (“MeitY”) has notified the Promotion and Regulation of Online Gaming Rules, 2026 (the “Gaming Rules” / “Rules”), published in the Gazette of India on 22 April 2026 and effective from 1 May 2026. The Gaming Rules establish the procedural and compliance architecture for classification, determination, registration, enforcement and grievance redressal under the Online Gaming Act. This note sets out the principal features of the Gaming Rules and highlights key implementation considerations.

1. Scope and Regulatory Architecture

1.1 The Gaming Rules establish the operational framework for the determination and registration of OSGs and E-sports and formally constitute the Online Gaming Authority of India (the “Authority”) to discharge regulatory functions under the Online Gaming Act.

1.2 The Authority is a multi-member body comprising a Chairperson from the Ministry of Electronics and Information Technology and ex officio members drawn from the Ministries of Home Affairs, Finance, Information and Broadcasting, Youth Affairs and Sports, and the Department of Legal Affairs. The Authority’s head office is to be situated in the National Capital Territory of Delhi, and it will function as an attached office of MeitY. The Authority is vested with broad powers, including to:

(a) determine whether an online game qualifies as an OMG;

(b) register OSGs and E-sports in specified circumstances;

(c) publish and maintain lists of determined and prohibited games;

(d) issue directions, guidelines and codes of practice;

(e) adjudicate complaints and non-compliance; and

(f) coordinate with financial institutions, enforcement agencies and sectoral regulators.

1.3 The Rules also introduce a broader compliance framework for online game service providers (“OGSPs”), including obligations relating to grievance redressal, data retention, payment facilitation, user safety features and designation of a point of contact. Given the breadth of the definition of OGSP and the Authority’s power to issue directions in relation to offering, facilitating and promoting online games, compliance exposure may also extend beyond platform operators to tournament organisers, affiliates, marketing intermediaries and other ecosystem participants.

1.4 The Authority is designed to function as a digital-first regulator, with online filings, digital hearings and techno-legal processes intended to reduce enforcement friction and enable faster supervisory intervention.

2. Classification and Determination of Online Games

The Online Gaming Act recognises three categories of online games:

(a) E-sports

E-sports are defined as multiplayer competitive events governed by predefined rules, where outcomes are determined solely by skill-based factors such as physical dexterity, mental agility or strategic decision-making. Participation fees and prize money are permitted. However, an E-sport must be recognised under the National Sports Governance Act, 2025 (“NSGA”), and separately registered under the Gaming Rules.

(b) Online Social Games (OSGs)

OSGs are games offered solely for entertainment, recreation or skill development that do not involve staking of money or any other stake with the expectation of monetary gain.

(c) Online Money Games (OMGs)

(i) OMGs are games (other than E-sports), whether based on skill or chance, in which users pay fees, deposit money or other stakes with the expectation of monetary or equivalent enrichment.

(ii) This tripartite classification is central to the regulatory framework. In particular, the Rules materially narrow the significance of the traditional “predominant skill” defence in circumstances where monetary staking, reward mechanics or off-platform monetisation are present.

3. When is Determination Required?

3.1 The Gaming Rules do not require every online game to be proactively determined by the Authority. Determination is required only in limited circumstances:

(a) where the Authority initiates a suo motu review and issues notice to the OGSP;

(b) where an OGSP seeks to offer a game as an E-sport; or

(c) where the Central Government notifies a category of OSGs for determination, having regard to factors such as transaction value, transaction volume or fund authorisation structures.

3.2 This is a notable feature of the framework: determination is not universal, but event triggered. The Authority’s power to initiate notice-based suo motu scrutiny preserves significant regulatory discretion with the Authority, since the Rules do not provide clear thresholds or guidelines for issuance of such notices.

4. How the Authority Will Determine Whether a Game is an OMG

4.1 In determining whether a game is an OMG, the Authority must assess both form and substance. The inquiry is not limited to labels or formal game design but extends to the commercial and functional realities of the product. The regulatory focus is therefore not merely on what the game is called or how it is presented, but on how value enters the game, circulates through it, and is capable of being extracted by users.

4.2 The Authority must consider, among other things:

(a) whether users pay fees, deposit money or place stakes at any stage of participation;

(b) whether users expect monetary gain or equivalent enrichment;

(c) whether payments are genuine entry / subscription fees or function as wagers;

(d) the structure and operation of the game’s revenue model; and

(e) whether rewards, benefits or in-game assets can be transferred, redeemed, monetised or used outside the game environment.

4.3 This last factor is particularly significant. The Rules expressly extend the inquiry beyond direct cash payouts to off-platform monetisation and secondary utility of in-game assets. This materially expands the scope of the OMG analysis.

4.4 The Authority may examine gameplay mechanics, technical architecture, revenue flows, user interface and payment design, and may seek expert or technical input where necessary. Determination is to be completed, as far as practicable, within 90 days from the date of receipt of a complete application or from the date of issuance of notice in a suo motu proceeding (excluding time taken to obtain information from the OGSP).

4.5 Procedure followed by the Authority:

(a) While making a suo-motu determination, the Authority will issue a written notice to the online game service provider specifying the grounds of the proposed determination, seek such information as it considers necessary, and provide a reasonable opportunity to submit representations and supporting material.

(b) Where determination is undertaken upon an application, the Authority will examine the details furnished by the applicant, call for additional information where the application is incomplete or inadequate, and may return the application for recorded reasons if the material provided is insufficient for making a determination.

5. Outcomes of Determination

5.1 The consequences of determination differ depending on the outcome.

(a) If the game is determined to be an OMG

The Authority will issue a determination order classifying the game as an OMG and publish the game on its list of online money games. Such games become subject to the prohibitions and enforcement consequences under the Online Gaming Act.

Importantly, an OMG determination is game-specific and OGSP-specific. It does not automatically apply to similar games offered by other operators.

(b) If the game is determined not to be an OMG

The consequences depend on the category of game:

(i) E-sports: the Authority will inform the applicant that the game is not an OMG and proceed with registration (subject to NSGA recognition).

(ii) OSGs: the Authority will issue a formal determination order confirming non-OMG status.

5.2 For OSGs, the determination remains valid unless the OGSP makes changes affecting payment facilitation or fund authorisation. The Authority may also revisit prior determinations where the game is modified post-clearance.

5.3 This makes post-launch product governance critical. Determination is not a one-time exercise; continued validity depends on maintaining the integrity of the approved commercial model.

6 Registration Framework

6.1 Registration is not mandatory for all online games. It is required only where:

(a) the Central Government notifies a specific online game or a class of online games for mandatory registration; or

(b) the game is proposed to be offered as an E-sport.

6.2 The Authority may also require registration during determination if it forms the view that the game merits registration based on user risk, transaction profile, scale, or public interest considerations.

6.3 Where registration is granted, the Authority will issue a digital Certificate of Registration (“CoR”), valid for up to ten years (as specified by the applicant), unless earlier surrendered, suspended or cancelled.

6.4 Each registration is game-specific and operator-specific.

7. Suspension, Cancellation and Enforcement

The Gaming Rules confer broad enforcement powers on the Authority.

7.1 A CoR may be suspended or cancelled (after hearing the OGSP) on grounds including:

(a) material modification of the game such that it may qualify as an OMG;

(b) repeated non-compliance with directions, codes or guidelines;

(c) expiry or withdrawal of NSGA recognition (for E-sports);

(d) false statements in the application process;

(e) failure to pay penalties; or

(f) violation of applicable law.

7.2 The Authority also has exclusive adjudicatory jurisdiction for non-compliance under the Online Gaming Act. It may:

(a)impose penalties;

(b)suspend or cancel registration; and

(c)prohibit an OGSP from offering, facilitating or promoting games for a specified period.

7.3 Procedural framework for inquiry and imposition of penalties:

(a) The Authority will issue notice setting out the particulars of the alleged non-compliance, along with relevant documents and the date and time for further proceedings, which are to be conducted in digital mode unless physical presence is considered necessary.

(b) On the date of the proceeding, the Authority shall explain regarding the alleged contravention, in relation to any direction or order made under section 8(3) of the Online Gaming Act and may thereafter either record an admission of non-compliance and impose penalty, or call upon the service provider to show cause why an inquiry should not be initiated.

(c) The Rules further permit the Authority, after considering the notice, documents and submissions, to determine whether an inquiry should be held, and in cases of non-appearance, to proceed in the absence of the online game service provider after recording reasons.

7.4 The Authority is required to apply a proportionality assessment when imposing sanctions, including by reference to user harm, recurrence, unfair gain, mitigation steps and overall gravity.

7.5 Notwithstanding this, the enforcement posture remains stringent. Violations involving OMGs may also trigger criminal exposure under the Online Gaming Act, including non-bailable offences and potential vicarious liability for company personnel.

8. Grievance Redressal and Appeals

The Gaming Rules create a two-tier grievance and appellate framework.

8.1 Internal grievance mechanism

Every OGSP offering a registered OSG or E-sport must establish and maintain an effective grievance redressal mechanism.

8.2 Appeal to the Authority

If a user is dissatisfied with the OGSP’s response (or receives none), the user may escalate the grievance to the Authority within 30 days from the date on which the OGSP has conveyed its decision on the grievance, or in case of non-redressal within the applicable timeline. The Authority shall endeavour to dispose of such appeals within 30 days and may direct corrective or remedial action.

8.3 A further appeal lies to the Appellate Authority under Rule 7.

This introduces a formal user-facing adjudicatory channel and elevates grievance handling into a core regulatory function. The Rules provide a structured appellate mechanism by specifying the orders of the Authority against which an appeal may be filed before the Appellate Authority. Such orders include determinations under Rule 10, directions requiring registration under Rule 12(2), registration of an e-sport under Rule 13(3), cancellation of a CoR under Rule 14, orders passed on user grievances under Rule 20(4), and penalties imposed under section 12 of the Online Gaming Act.

9. User Safety as a Core Compliance Requirement

9.1 The Gaming Rules elevate user safety from a platform-design consideration to an express compliance obligation. OGSPs offering OSGs and E-sports are required to implement user safety features appropriate to the nature and risk profile of the relevant game.

These include:

(a) age verification and age-gating mechanisms;

(b) parental controls;

(c) time restrictions;

(d) user reporting and grievance tools;

(e) counselling support; and

(f) fair-play and integrity monitoring measures.

9.3 For consumer-facing and youth-accessible platforms in particular, these requirements should be treated as core product and compliance obligations rather than ancillary user-experience features.

10. Payment and Fintech Controls

10.1 One of the most consequential aspects of the Gaming Rules is the direct compliance burden imposed on banks, payment intermediaries and fintech participants.

10.2 Before facilitating payments for an OSG or E-sport, banks and payment intermediaries must verify the relevant CoR or determination order.

10.3 Further, where the Authority identifies a game as an OMG, banks and financial institutions may be directed to suspend, restrict or discontinue payment facilitation and fund authorisation in relation to that game.

10.4 This effectively deputises financial intermediaries into the gaming enforcement architecture and is likely to result in:

(a) enhanced merchant diligence;

(b) stricter onboarding requirements for gaming platforms;

(c) more conservative transaction monitoring; and

(d) faster de-platforming of high-risk operators.

11. Key Implementation Concerns

While the Rules establish a comprehensive framework, several operative concepts remain open-textured and are likely to depend materially on future guidance, interpretive practice and enforcement positions adopted by the Authority.

11.1 Ambiguity around “other enrichment”

(a) The Rules include within the OMG inquiry rewards, winnings and benefits capable of redemption, monetisation or off-platform use. However, the scope of “other enrichment” remains unclear, particularly in relation to:

(i) in-game cosmetics;

(ii) virtual items;

(iii) skins;

(iv) transferable tokens; and

(v) secondary-market assets.

(b) Absent further clarification, this may create interpretive uncertainty for games with tradeable or transferable in-game economies.

11.2 Subscription and access-fee models remain reviewable

(a) While subscription fees and one-time access fee models remain permissible in principle for OSGs, they are unlikely to be determinative in themselves. Such models may still invite regulatory scrutiny where, in substance, the payment architecture resembles staking, wagering or reward-linked participation.

(b) This reinforces the broader regulatory emphasis on economic substance over formal product characterisation.

11.3 Unclear scope of “payment-facilitation changes”

The validity of a determination order depends on the absence of changes affecting payment facilitation or fund authorisation. However, the Rules do not define what constitutes a relevant change.

(a) This creates avoidable ambiguity, particularly for routine product updates such as:

(i) UI / UX changes;

(ii) pricing presentation updates;

(iii) ad-free variants;

(iv) accessibility improvements; or

(v) non-monetisation feature changes.

(b) This ambiguity creates scope for challenging determination orders based on lack of objective standards, a lack of clarity regarding re-opening settled determinations, and on whether the alleged modification is commercial, technical, or monetisation-related. Since the Authority may direct the OGSP to cease offering the game pending fresh determination where it believes a modification requires re-determination, a platform may need urgent writ or appellate relief on an interim basis.

11.4 Financial-sector conservatism

Given the Authority’s powers to issue directions to banks and payment intermediaries, coupled with criminal exposure under the Online Gaming Act, financial institutions are likely to adopt a cautious and conservative compliance posture.

This may materially affect merchant onboarding, transaction approvals and platform continuity.

12. Recommended Next Steps

The immediate compliance implications are significant.

(a) OSG operators should review monetisation models, reward mechanics, payment flows and user-facing disclosures to mitigate classification risk. Internal change-management protocols should be implemented to track product modifications that may affect determination status.

(b) E-sports operators should prioritise NSGA recognition, align tournament structures with skill-based criteria, and build anti-betting and integrity controls into platform design.

(c) Banks, fintechs and payment intermediaries should implement merchant verification protocols, CoR / determination order checks, and controls for identifying and restricting OMG-linked transactions.

13. Conclusion

13.1 The Gaming Rules mark a significant shift toward a centralised, enforcement-led framework for online gaming regulation in India. They establish a comprehensive architecture for classification, determination, registration, payment control, enforcement and user protection, while materially increasing compliance expectations across gaming and financial ecosystem participants.

13.2 The framework is broad, interventionist and operationally significant. Its practical impact will depend on how proportionately the Authority exercises its powers, and how quickly interpretive guidance is issued on key areas of ambiguity.

13.3 While the framework is now operational, its constitutional validity is likely to remain subject to continued judicial scrutiny. In parallel, several of the Rules’ most commercially significant concepts will need to be clarified through subordinate guidance and enforcement practice.

13.4 The most significant disputes are likely to arise from OMG determination, re-determination after product changes, payment-facilitation disruption, penalty action, and CoR suspension or cancellation. Therefore, businesses operating in or adjacent to this sector should prepare for both regulatory engagement and adversarial challenges at short notice.

13.5 With the Gaming Rules taking effect on 1 May 2026, stakeholders should treat compliance readiness as an immediate priority.

Authors – Sachin Mehta, Arunav Roy and Pratika Shankar – Partners

Disclaimer: This publication only highlights key issues and is not intended to be comprehensive. The contents of this publication do not constitute any opinion or determination on, or certification in respect of, the application of Indian law by Talwar Thakore & Associates (“TT&A”). No part of this publication should be considered an advertisement or solicitation of TT&A’s professional services.