May 27, 2022

The Problem with Loot Boxes

Gambling reform has been a divisive topic over the past few years. It’s almost impossible to get anyone to agree on the same rules – one corner is always arguing that the regulations are too strict while the other side advocates for tighter restrictions. One thing that’s been repeatedly discussed by governments around the world is the idea of loot boxes in games.

What Are Loot Boxes?

Loot boxes are an added extra that players can buy with real-world money. The contents of the boxes are random – players are given a list of possible items that they could get from the box, ranging in how valuable they are in-game. While the idea of loot boxes is nothing new, how they are viewed has changed in recent years after it was revealed that some young players had taken a parent’s credit card to buy boxes.

The biggest argument with these boxes is that they aren’t too dissimilar from gambling. When you gamble you know that you might win a large value prize, a small prize, or nothing. When you open loot boxes you’re guaranteed to get something, but it could be a low-value item or a higher value item. The way that loot boxes work puts them on the same level as slot machines or scratch cards. The difference with gambling is that there is an age limit and regulations in place to protect younger people from harm. Games that have loot boxes, like FIFA, are often played by people under the age of 18 (legal gambling age in most countries) which results in younger people potentially being exposed to gambling which could lead to addiction.

Why Are People Against Loot Boxes?

It isn’t that people are against loot boxes themselves, but more so that there are no rules in place surrounding them – despite the fact that they do offer people a way to gamble. Campaigners have argued that loot boxes specifically target the people that gambling laws are designed to protect, and there are no regulations in place to stop this. In April 2021, a study conducted by researchers at the University of Plymouth and Wolverhampton University found that loot boxes “are structurally and psychologically akin to gambling”. In the same study, it found that large numbers of children were opening loot boxes – of the 93% of children who play video games, 40% had opened loot boxes. When you consider that a loot box generally offers people paying physical money to win a virtual prize it is easy to see why this type of gambling should be closely monitored, especially when being offered to those under the age of 18. Campaigners say this model of using loot boxes is similar to advertising casino offers in a video game setting and as such, should be treated in the same way as other gambling methods, where you need to be over the age of 18 and show a verified form of photo ID in order to be able to take part online.

This study isn’t alone in finding the link – several researchers have warned of the damage that loot boxes can do, and governments have started to listen. Belgium was one of the first countries to ban loot boxes when they declared them illegal in 2018. The Belgian government called loot boxes “a violation of gambling legislation”. The new legislation meant that any loot boxes that could be bought for real money had to be removed from video games in Belgium. Failure to comply could result in companies facing criminal law trials, a potential fine of up to £700,000, or even up to 5 years in prison for the publishers.

Will the UK See a Ban of Loot Boxes?

Belgium isn’t the only company to have discussed banning loot boxes. The UK government’s gambling reform was updated to include a discussion around loot boxes and their legality, given their addictive nature. The current 2005 Gambling Act doesn’t cover loot boxes, meaning that the regulatory body can’t use its powers against the publishers.

In June 2020, the UK Government launched a “call for evidence”, looking at the impact of loot boxes on gambling-like behavior and potential addiction. The call for evidence overlapped with a wider call for evidence of general gambling-related harm, ahead of a White Paper that is expected to be published in May 2022.

A White Paper is like the first draft of new legislation. White Papers are released with general topics of discussion, which will then be debated and potentially put into law over the process of many months of development. The May 2022 White Paper is expected to list the areas that the gambling reform will focus on. The UK Gambling Commission has already announced that adverts are no longer allowed to feature any kind of youth culture or be of any appeal to younger people. So far there has been no word on how the government will view loot boxes, but considering a call for evidence was announced it’s likely that we’ll see some kind of regulation for video game gambling, even if an outright ban on loot boxes isn’t proposed.

The Future of Loot Boxes

Although it is widely thought that the UK won’t go as far as banning loot boxes, it is widely accepted that some regularisations surrounding them will need to come into play. When you consider that games such as FIFA Football offer loot boxes and microtransactions, it is easy to see why we would need to have some guidance in place. The tricky part will come with implementing these rules; for example, just because the law is that you need to be over the age of 18 to take part, this will be hard to monitor with online and computer games that are aimed at all ages. This is probably one of the reasons that any regulations are taking so long to put together, because they need to rule that work and can be monitored and that could be harder to do – although following online casino influence will certainly help.

About the author 

Elle Gellrich

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