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Sikkim Government clarifies its stand on the online gaming licenses for the first time [Exclusive]



Exclusive: The Sikkim government has finally clarified all aspects relating to the online gaming licenses that it started issuing since 2009.

An officer associated with Director of Sikkim Lotteries, Basanti Rai’s office confirmed that a total of nine Letter of Intents (LOIs) have been issued by the Sikkim government while only four of these nine LOI holders have procured provisional license required for setting up the necessary infrastructure.

The lottery department confirmed that none of the provisional license holders have received the full license required to start the online gaming website as they have not fulfilled the technical standard requirements. The department added that full license will be issued as and when the operators fulfill the technical requirements and other conditions laid down in the terms of the provisional license.

The lottery department denied that the license holders were facing legal difficulties in commencing operations and said that the Sikkim Online Gaming (Regulation) Act 2008, other rules and issue of licenses was duly done with the “consent” of the Central government.

On being asked whether the recently notified Information Technology (Due diligence observed by Intermediaries Guidelines) Rules, 2011 [IT Rules 2011] would affect the licenses as reported by me earlier, the officer said that the online gaming licenses were issued as gambling was a state subject under the Indian Constitution and thus the Sikkim government was competent to issue the licenses.

The officer however added that since subsequent to the issue of the licenses, doubts have been raised as regards to the legality of the licenses, the Sikkim government will “correspond with the Central government” to resolve the issue and seek clarifications.

It may be noted that the LOI contains clauses which absolve the Sikkim government of any liability if any state government or the Central government passes any law which prohibits or criminalises online gaming, thus highlighting the ambiguity of the legality online gaming in India.

Read my earlier exclusive posts on Sikkim online gaming licenses:

The farce called Sikkim online gaming licenses

Clearing the confusion about Sikkim Online Gaming Licenses

Jay has researched extensively on gaming laws and has been cited by various media houses and journals as an expert. He has helped leading newspapers in their stories on gaming laws. Jay completed his B.A. LL.B. (Hons.) degree from NUJS, Kolkata in 2015 and is currently based out of Mumbai.



  1. Amit Patel

    July 25, 2011 at 5:47 pm

    What is the end outcome of statement released by the officials? Will it be possible to see online betting actually happens in nearby future?

    • Jay Sayta

      July 25, 2011 at 7:38 pm

      With the problems that the license holders are facing at the moment, it will take some time for the license-holders to start operations if the legal difficulties are settled.

  2. Amit Mittal

    September 25, 2011 at 8:57 pm

    Can a online betting site incorporated in Malta or any authorised area for that matter get a LOI in sikkim?

    • Jay Sayta

      September 25, 2011 at 11:23 pm

      Only Indian incorporated companies can participate in the Sikkim online gaming process. Thus only Indian companies can apply for LOI and the licenses.

  3. Ravi

    October 10, 2011 at 3:41 am

    hello Jay

    I want to know (let us assume),if all the legal difficulties in commencing operations is sorted out, and websites start working. Then—–

    1) Is it mandatory for websites to setup there SERVER and operate from Sikkim only, will they be able to operate from any other place (except Sikkim) in India?


    2) If they operate from somewhere else, will their rules and regulations (taxes, license etc.) are liable only towards Sikkim government or they have to consider state (from which they are operating) rules also?

    • Jay Sayta

      October 10, 2011 at 10:35 am

      Either the main server or mirror server or both have to be located in Sikkim. The provisional license of 120 days is issued precisely for this reason- for allowing necessary infrastructure relating to servers and website to be set up.

      Thus they would be liable only to the Sikkim government to the taxes, i.e. the gross gaming yield or any other taxes as the case may be.

  4. Vijay

    March 1, 2012 at 12:49 pm

    Any updates ?

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