Regulatory pushes against video game loot boxes—which many see as an unregulated form of gambling—has just gotten more organized as the U.S. State of Washington has joined with 15 other countries pledging to work to reclassify the trading and gambling of virtual items in video games.
The UK Gambling Commission announced the agreement. Germany, France and Spain are among the other countries in the agreement.
The Washington State Gambling Commission signed an agreement which commits the regulatory agencies to work together to address the “risks created by the blurring of lines between gaming and gambling,” according to a press release.
The agreement says the coalition will also focus on third-party sites that aid in the trade of virtual items.
Controversy has sprung up around loot boxes, which give players undisclosed virtual items to players when purchased. Virtual items are referred to as skins and can be anything of use in a particular game from special weapons and other items to useful in-game character skills.
Players already trade and gamble these skins, often on third-party websites. Since a player doesn’t know what skins are included in the loot box until purchased, many regulators feel their acquisition and trade is a type of gambling since players value some items more than others. Video game makers argue that all loot boxes give some skins, so their purchase is not a gamble.
However, loot boxes have also gained attention since a large number of gamers are underage, and regulators and problem gambling advocates say their trade is an introduction to gambling for minors.
Belgium and the Netherlands have already declared loot boxes as gambling and some gaming platforms, such as Steam, have moved to limit trade and movement of the items.
The new coalition, however, is by far the most organized move against the trade of loot boxes so far. The participating countries include Austria, Czech Republic, France, Gibraltar, Ireland, Isle of Man, Jersey, Latvia, Malta, The Netherlands, Norway, Poland, Portugal, Spain, the United Kingdom, and the US’s Washington State Gambling Commission.
Neil McArthur, chief executive and signatory of the UK’s Gambling Commission explained the intent behind the effort.
“We have joined forces to call on video games companies to address the clear public concern around the risks gambling and some video games can pose to children,” Neil McArthur, head of the UK Gambling Commission said in a press release. “We encourage video games companies to work with their gambling regulators and take action now to address those concerns to make sure that consumers, and particularly children, are protected.
“We want parents to be aware of the risks and to talk to their children about how to stay safe online,” McArthur said.
The move also comes as an Australian Senate inquiry into loot boxes has found links between spending on the boxes and problem gambling and concluded that in-game purchase of loot boxes was psychologically akin to gambling.
The inquiry was titled “Gaming micro-transactions for chance-based items” and investigated whether loot boxes constitutes a form of gambling.
The inquiry found there is an undeniable link between loot boxes and problem gambling and that “The more severe gamers’ problem gambling was, the more likely they were to spend large amounts of money on loot boxes.”
“These results support the position of academics who claim that loot boxes are psychologically akin to gambling,” the inquiry said. “Spending large amounts of money on loot boxes was associated with problematic levels of spending on other forms of gambling. This is what one would expect if loot boxes psychologically constituted a form of gambling. It is not what one would expect if loot boxes were, instead, psychologically comparable to baseball cards.”
The inquiry recommended that games containing loot boxes should carry parental advisories, indicate the presence of gambling content and potentially be restricted to players of legal gambling age, according to a report at Asian Gaming.
