Karnataka proposes bill to ban online betting except for ’games of skill’

Karnataka proposes bill to ban online betting except for ’games of skill’

Mangalore Today News Network

Bengaluru, July 8, 2025: The state government is planning a total ban on all forms of online betting, wagering and gambling involving “games of chance,” where defaulting individuals and entities can face imprisonment up to three three and be fined up to Rs 1 lakh, according to a new draft law proposed by the home department.

“All forms of online betting, wagering, or gambling involving games of chance, including the use of money, tokens, virtual currency, or electronic funds, are prohibited,” the draft Karnataka Police (Amendment) Bill, 2025, states. The bill is expected to be tabled in the upcoming session of the legislature.

As per the bill, those aiding and promoting illegal online betting can be punished up to a term of six months with a fine that may extend to Rs 10,000. The Bill seeks to amend the Karnataka Police Amendment Act, 1963 and excludes "games of skill" from the purview of the proposed ban.

The Bill defines "games of chance" as those where the outcome predominantly depends on “luck,” “randomness” and "uncertainty." It includes online gambling, betting and wagering. This differs from the earlier definition in the 1963 Act, which included both chance and skill under "games of chance."

Similarly, "games of skill" have been defined as those where the outcome predominantly depends on skill, knowledge, training or expertise of the participants.

The bill comes at a time when the gaming industry’s annual contribution to Karnataka’s GST pool is estimated to be around Rs 1,350 crore. The state is estimated to have 1.4 crore gamers, and the valuation of the skill gaming enterprise in Karnataka is estimated at $5 billion.

Gaming industry stakeholders estimate that the illegal betting and gambling market in India is worth $100 billion. In 2021, when the BJP-led government was in power, a bill was passed in the legislature, which sought to ban online betting even for "games of skill." However, the Act was struck down by the High Court.

4-member regulatory authority 

A new 4-member Karnataka Online Gaming and Betting Regulatory Authority will issue licences to skill-based gaming platforms.

The authority is mandated to distinguish between games of skill and games of chance based on judicial precedents and industry standards. They also have to issue licenses to operators of skill-based gaming platforms. The authority is provided with judicial and administrative powers.

The authority provides licences to skill-based programmes. The eligibility criteria include verification of Know Your Customer (KYC) and anti-money laundering compliance. Licenses shall be valid for three years, renewable upon compliance with the provisions of this chapter.

Participants in these skill-based online betting events must be aged 18 and above. The Authority shall collaborate with the Department of Information Technology and the Karnataka Police Cyber Crime Branch to develop and deploy technology for blocking unregistered online betting platforms.

The Bill also seeks to reward "whistleblowers," who provide credible information regarding illegal betting operators.