UK Government responds to loot box petition and is monitoring convergence between gambling and video games

The UK government has responded to a petition asking for gambling laws to including gambling in video games, which potentially target children and vulnerable adults.

The petition, started by Connor Rhys Deeley, was started in the wake of a general discourse in the games industry around the issue of loot boxes. The DCMS has already replied to a letter written by Cambridge MP Daniel Zeichner on the subject.

This new response does echo some of the same points, mostly that the Gambling Commission has already looked into the situation and is monitoring it for the Government. The response says:

The Gambling Commission has strong powers to regulate gambling and is monitoring convergence between gambling and video games closely. The government is committed to protecting children from harm.

Expanding on that point, the response also addresses some of the different descriptions of gambling and how it relates to games and in-game items. It says:

"Where gambling facilities are offered to British consumers using in-game items that can be converted into cash or traded for items of real-world value, then such activities must be licensed by the Gambling Commission and adhere to strict requirements for the protection of children and the vulnerable, which include measures to prevent underage gambling. It is an offence to invite a child to gamble, and where there is a failure to prevent underage gambling, the Commission will take regulatory and/or criminal action.

A good example of this would be ‘skins gambling’, such as that popularised in the gaming community for games like CS:GO, which has also been addressed in recent months by developer Valve and other organisations. However, the response does go on to say that if items are not tradeable for real money or real life value then it would not be able to be licenced by the Gambling Commission.

"Where the facility exists for players of video games to purchase a key to unlock a bundle containing an unknown quantity and value of in-game items as a prize, and where there are readily accessible opportunities to cash in or exchange those awarded in-game items for money or money’s worth, then these elements of the game are likely to be considered licensable gambling activities. In contrast, where prizes are restricted for use solely within the game, such in-game features would not be licensable gambling. The Gambling Commission is committed to working with the video game industry to prevent gambling-related harm related to their platforms."

So, a game that aggressively monetises itself with a loot box based progression system could fall under these rules would not fall under the gambling rules unless it gains real-world value. However, that’s not to say that the practice isn’t being looked in to via different avenues of legislation. The response also adds:

"Consumers are also protected by the Consumer Protection from Unfair Trading Regulations 2008. This includes a requirement on businesses not to subject anyone to misleading or aggressive marketing practices, or, for example, direct exhortation to buy products, such as games content, including in-game purchases such as loot boxes. The government is committed to ensuring that consumers are properly protected and that children’s vulnerability and inexperience is not exploited by aggressive commercial practices."

For now, it seems the Government has shut the lid on the debate of gambling laws being the applicable legislation for loot boxes in games. But it’s going to be interesting to see where this particular discussion ends up in future.