Sikkim is the most liberal State for allowing online gaming and betting in India. As per the Constitution of India, gambling and betting is a State Subject and States are free to enact laws as per their own requirements.
The Sikkim Online Gaming (Regulation) Act, 2008 has provided a legal framework for online gaming in India. This is a revolutionary piece of legislations as it has tried that no other State has been able to achieve. The 2008 Act has been notified (PDF) and it is now operational in the State of Sikkim. Even an authorised officer (PDF) has been appointed under the 2008 Act by the Sikkim Government.
In order to make the provisions of 2008 Act operational, the Sikkim Online Gaming (Regulation) Rules, 2009 (PDF) were formulated. Perry4Law and Perry4Law’s Techno Legal Base (PTLB) have discussed these Rules 2009, along with necessary 2009 amendments, for the larger interest of all stakeholders.
Under the Sikkim Online Gaming (Regulation) Act, 2008 there are provisions regarding granting of provisional and regular licences.
A provisional licence is first issued by the Government of Sikkim if it is satisfied that the application made by the applicant complies with all the requirements prescribed in this regard. A fee of Rs. 1 lakh must be given by the applicant and he/she/it must set up the necessary infrastructure and other requirements so as to be in a position to commence operation of online games and the sports games.
If the Government is satisfied that the applicant is fully ready to commence operations of online gaming and sports gaming activity and has complied with the stipulations prescribed in the said provisional licence and such other terms and conditions prescribed in the Act and Rules, the Government may grant a regular licence for operation of online games and sports games in Form-2A for five years on payment of a fee of five lakh rupees.
For enabling the conduct of Online Games and Sports Games specified under Rule 3 of the Sikkim Online Gaming (Regulation) Rules, 2009 the following terms and conditions shall apply:
(1) The provisional licence is issued for the specific purpose of enabling the applicant company to set up and establish the entire requisite infrastructure and other components necessary for actual commencement of online gaming and sports gaming activity.
(2) The provisional licence does not confer any right to the licensee to commence its online gaming and sports gaming unless and until all the requirements stipulated by the State Government are fulfilled and the regular licence is issued by the Government.
(3) The Licensee shall operate Online Games and Sports Games from Sikkim only.
(4) The Licensee shall commence actual online gaming and sports gaming operations, i.e., “go live” within 120 days.
(5) The licensee should make available only the games specified under rule 3 of the Sikkim Online Gaming (Regulation) Rules, 2009. If the licensee intends to include new games, prior approval of the Government must be obtained.
(6) The Licensee shall allow any Officer authorized by the Government to inspect the setup process or inspect premises from where the online games are to be operated.
(7) The Provisional licence is valid for 120 days from the date of issue and immediately on the licensee intimating in writing to the Government that it is ready to commence actual online gaming and sports gaming operations, i.e., “go live” and on such determination by the State Government that the applicant licensee has complied with the stipulations prescribed hereinabove and such other terms and conditions prescribed in the Act and Rules, the licensee may be granted a regular license for a period of five years on payment of fees of five Lakhs rupees as provided under the Rules.
(8) The Licensee shall pay to the Government a sum of one lakh rupees as Provisional License fee through a Bank Draft in favour of the Director, Sikkim State Lotteries, and submit the same before issue of the said licence.
(9) The provisional license is liable to be cancelled if the licensee violates any of the above terms and conditions and the provisions of the Sikkim Online Gaming (Regulation) Act, 2008 and the rules made thereunder.