Just as it is with any other type of business, nothing goes on unless firms have a license. It applies to all firms, no matter where they run their affairs. Similarly, to operate online gambling in India requires a firm to have a permit. Thus, for the Local Regulatory Authority to grant a license, firms have to fulfill specific terms.
Application Process for a License
The first is that any firm has to base its business in India to apply for online gambling business. Only then, the licensing process to set up a gambling activity in India will begin. On top of that, to secure protection to the firms, authorities in India have to adhere to certain terms themselves. These include provisions such as policies related to Know Your Customer (KYC) services. Also, the authorities must follow Due Diligence on their part.
The firms need to provide transparent data on the types of online gambling games. The step so stated is vital to complete the ID process of the Ultimate Beneficial Owner or UBO. Thus, after this, there is one more step left to gain a license. It is to get a transit server. One may ask why such a step is crucial? The reason is the server sends all the data related to online gambling in India to the respective jurisdiction. It is because, in India, gambling/online gambling is, at the end of the day, a state subject. That is why the data needs regulation from the State the firm runs its activities from.
Some More Points on the Application Process
Apart from the already listed steps, there exists another such step. That is, hardware with the client database needs to be present in India. It is to fulfill the need for a Permanent Establishment Requirement. Also, the database should be on the local servers. Besides, the firms need not worry about it. That is because India has in place a network of reliable operators that provide services for hosting such servers. The terms cater only to those firms that are dealing in eGaming, which internet gambling is a part of.
Thus, it marks the formal end of the application process for a business license for online gambling in India.
Requirements of a Business License
Currently, firms can only set up skill-based games under online gambling in India. It is to comply with the provisions of Section 12 of the Public Gambling Act of 1867. On top of that, only a few states have regulations on online games. These states include the States of Nagaland, Sikkim, Goa, etc.
Thus, taking Nagaland to fulfill the purpose of the article, the following are the terms for a license in Nagaland.
- The firm must have the main workforce in India. It would be a mandatory point even if a firm were to set up a business in another state.
- The firm or the individual must not have a criminal past.
- Also, online gambling has to pass through Nagaland’s Director of State Lotteries. And the firm must pay a sum of INR 50000 for the process of application.