The Department for Digital, Culture, Media and Sports (DCMS) has responded to recent concerns raised by an MP and by a public petition over the legality of loot boxes in video games.
The petition, started by Connor Rhys Deeley, asks the Government to adapt its gambling laws to include gambling within a video game which targets children. The petition has reached enough signatures to generate a response from the UK Government. If the petition reaches 100,000 signatures, then it can be debated in Parliament.
This has been followed by a recent letter from MP for Cambridge, Daniel Zeichner, who asked the Secretary of State for DCMS, "what steps she plans to take to help protect vulnerable adults and children from illegal gambling, in-game gambling and loot boxes within computer games"
The response came from under-secretary for the DCMS, Tracey Crouch, MP for Chatham and Aylesford. The issue was discussed in a report from the Gambling Commission from March 2017. The response said "Protecting children and vulnerable people from being harmed or exploited by gambling is one of the core objectives of the regulation of gambling in Great Britain and a priority for the government. The Gambling Commission have a range of regulatory powers to take action where illegal gambling is taking place. The government recognise the risks that come from increasing convergence between gambling and computer games. The Gambling Commission is keeping this matter under review and will continue to monitor developments in the market.
The Gambing Commission’s report from earlier this year stated: "As modern video-gaming has become increasingly social in nature, aided by the availability of technology such as open application programming interfaces (APIs), the use of in-game items such as virtual currencies has created some concerning by-products.
"Representatives of the video game industry have explained that in-game items are provided in a ‘closed loop’ fashion, meaning they are not intended to be exchanged for cash, either with the games providers, with other players or with third parties. The networks via which games are accessed, are not designed to have open functionality to facilitate users trading in-game items with each other for money. This approach is underpinned by the terms and conditions governing the use of the networks.
"In our view, the ability to convert in-game items into cash, or to trade them (for other items of value), means they attain a real world value and become articles of money or money’s worth. Where facilities for gambling are offered using such items, a licence is required in exactly the same manner as would be expected in circumstances where somebody uses or receives casino chips as a method of payment for gambling, which can later be exchanged for cash."