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UK government threatens games industry with new laws for loot boxes

Game companies will need to start regulating themselves over loot boxes, says the UK government, or face legislation.

All the way back in 2017, a petition was sent to the UK government requesting it update gambling laws to include loot boxes. At the time, the government didn’t view loot boxes as a form of gambling, but it looks like its position is beginning to change.

Over the weekend, the government issued a statement to games companies telling them they need to take more direct action to protect children and young people from loot boxes.

While it currently has no plans to go so far as to ban them, as some countries have, it says it will consider legislation if companies don’t introduce sufficient methods of protection.

This has come about following the results of an investigation by the Department for Digital, Culture, Media and Sport. In 2020, it was requesting evidence that proved loot boxes are a form of gambling.

While the government’s statement on the matter doesn’t explicitly call them gambling, it does say that a link was found, with those who purchase loot boxes more likely to experience gambling problems as well as mental health and financial issues.

It also acknowledges that some measures, such as parental controls, have already been implemented by the likes of Microsoft, and that it ‘wants to build on this with strong protections for children across the entire games industry.’

‘We want to stop children going on spending sprees online without parental consent, spurred on by in-game purchases like loot boxes,’ says culture secretary Nadine Dorries.

‘Games companies and platforms need to do more to ensure that controls and age-restrictions are applied so that players are protected from the risk of gambling harms. Children should be free to enjoy gaming safely, whilst giving parents and guardians the peace of mind they need.’

As for what exactly the government wants companies to do, it says companies and platforms should ‘provide spending controls and transparent information to all players’ and ‘support the minority of players who spend a disproportionate amount of money on loot boxes.’

A new group consisting of games companies, platforms, and regulatory bodies is already being put together to ‘develop industry led measures to protect players and reduce the risk of harm.’

The government is also launching a Video Games Research Framework to help find better evidence that improves understanding of the positive and negative impacts of video games.

It remains to be seen how much of the industry will actually comply with this. Let’s not forget that when countries like Belgium and the Netherlands banned loot boxes altogether, the first reaction of EA (publisher of loot box heavy games like the FIFA series) was to just stopped selling the games, rather than removing loot boxes.

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