Why Game Loot Boxes Could Eventually Be Regulated

loot box regulation

Whether opening game loot boxes is a form of gambling or not has been an on-going discussion by many jurisdictions. In the United States, the UK, and Ireland, loot boxes are still not classified as gambling and some are still uncertain about it.

Loot boxes are now widely present in the world of gaming. Mobile, PC, and console games have loot boxes, crates, chests, or mystery boxes that players could purchase. There are still free loot boxes that players could get as a reward but many would still spend money on this. Some would even spend so much to the point that they end up having debts. Sounds familiar? It does sound like a problem that people who are addicted to casino games have.

When opening these boxes, the players get the chance to win in-game items that they can use in their gameplay. It could be skins, weapons, armors, and even cosmetic items. This may sound harmless to some but the problem with this system is that players are unaware of what they will get as what they are technically purchasing is only a chance of getting the items they like.

Different Stands on Loot Boxes

Ireland is still uncertain on how loot boxes should be classified as there is still no specific law directed towards this. The recent Oireachtas (Irish legislature) report did acknowledge their uncertainty about this gaming system.  However, the country has already signed up to the declaration of gambling regulators on their concerns that are related to the blurring lines of gaming and gambling.

They then recognize that there are already growing concerns about this system and they are now calling out gaming companies and platforms with this system to come up with solutions to these problems. Currently, the country doesn’t have a gambling regulator who could offer guidance in regulating this sector of gaming. However, the lack of uncertainty that they have regarding this matter will likely be addressed once a regulator is appointed.

Meanwhile, things are already stirring up a bit in the UK. Well, there is still no law that sees loot boxes as gambling in the UK but the House of Lords have already recommended that this should be brought within the UK’s Gambling Act.

In July 2020, the House of Lords urged the government to classify loot boxes as gambling. They said that the government should act immediately and bring loot boxes within the remit of gambling legislation and regulation.

The report from the House of Lords states, “There is academic research which proves that there is a connection, though not necessarily a causal link, between loot box spending and problem gambling. We echo the conclusions of the Children’s Commissioner’s report, that if a product looks like gambling and feels like gambling, it should be regulated as gambling.

“The liberalization of gambling by the Gambling Act 2005, the universal adoption of smartphones, and the exploitation of soft-touch regulation by gambling operators have created a perfect storm of addictive 24/7 gambling.”

Despite this, however, loot boxes are still not officially classified as gambling in the UK. The government has only called for evidence on loot boxes as a form of gambling. There is still no decision on this but there is a chance that they would agree with the House of Lords.

When it comes to the EU, they have also already given loot boxes some attention. There is a divergence when it comes to how EU states approach the issue but the EU Parliament has already reported that some video games have problematic design features that create an irresistible urge to play. They also said that these features could influence the motivation of the players in a way that may lead to problematic outcomes that concern psychological and financial aspects.

Why Regulations Are Being Pushed

With all that, it generally appears that there is no specific law that prohibits loot boxes just yet. Currently, it’s only Belgium that’s known to have banned loot boxes. The same goes for the Netherlands but only for certain loot boxes. China is already aware of the issue and has already started to regulate it by limiting its availability to the players.

It’s perfectly understandable why there are now governments that are looking into this as there are already reports of loot boxes problems. It has been reported that there are players who would spend so much money on these loot boxes that they end up having debts. What’s even alarming is that minors are also spending money on this.

There still are people who would argue that loot boxes shouldn’t be classified as gambling but as more governments look into this, there could be more solid pieces of evidence that could arise. Loot boxes may either be banned or regulated in certain countries shortly.

About the author

Tom

35 years old, married with children (1). My gaming is done exclusively on the Xbox One these days, but my gaming history goes all the way back to the Atari 2600. FPS and racing games mostly, but I dive into other genres on occasion.

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