Tuesday, June 25, 2024

UK Gambling Commission weighs in on loot crate legality

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The U.K. Gambling Commission today posted a statement clarifying that video game loot boxes do not qualify as gambling under current British law. However, the statement also warns that loot boxes show how “the line between video gaming and gambling is becoming increasingly blurred.”

It’s the U.K. Gambling Commission’s job to ensure that the country’s gambling laws are adhered to. In recent months, the UKGC has stepped into such controversies as skin gambling sites, prosecuting the owners of a website devoted to betting using virtual currencies with real world value.

But for most games, virtual currencies have not outlet into real currencies. This is the line where British law defines gambling.

“A key factor in deciding if that line has been crossed is whether in-game items acquired ‘via a game of chance’ can be considered money or money’s worth,” states the commission. “In practical terms this means that where in-game items obtained via loot boxes are confined for use within the game and cannot be cashed out it is unlikely to be caught as a licensable gambling activity. In those cases our legal powers would not allow us to step in.”

Loot boxes in games like Star Wars Battlefront 2 are beginning to attract the attention of lawmakers. Earlier this week, Hawaiian Reps. Chris Lee and Sean Quinlan held a news conference that assailed loot crates as preying on children, naming Star Wars Battlefront 2 specifically.

And in Belgium, the country’s Gaming Commission last week opened an investigation into loot box purchases in video games. The nation’s minister of justice has signaled he wants to go to the European Union to have action taken against games that employ loot crates and in-game purchases.

Electronic Arts suspended in-game transactions in light of the controversy surrounding loot crate systems. The Entertainment Software Association, which represents the interests of games publishers in the United States, recently issued a statement denying that loot crates represent gambling.

“Loot boxes are a voluntary feature in certain video games that provide players with another way to obtain virtual items that can be used to enhance their in-game experiences,” offered the statement. “They are not gambling. Depending on the game design, some loot boxes are earned and others can be purchased. In some games, they have elements that help a player progress through the video game. In others, they are optional features and are not required to progress or succeed in the game. In both cases, the gamer makes the decision.”

Despite the UK Gambling Commission’s clarification on the legality of loot crates, its statement came very close to outright calling for governmental scrutiny.

“Many parents are not interested in whether an activity meets a legal definition of ‘gambling’. Their main concern is whether there is a product out there that could present a risk to their children.

“We are concerned with the growth in examples where the line between video gaming and gambling is becoming increasingly blurred. Where it does meet the definition of gambling it is our job to ensure that children are protected and we have lots of rules in place, like age verification requirements, to do that.

“Where a product does not meet that test to be classed as gambling but could potentially cause harm to children, parents will undoubtedly expect proper protections to be put in place by those that create, sell and regulate those products. We have a long track record in keeping children safe and we are keen to share our experiences and expertise with others that have a similar responsibility. Whether gambling or not, we all have a responsibility to keep children and young people safe.”

Thanks to PC Gamer.

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