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Loot Boxes Should Be Classed As Gambling And Regulated, MPs Say

Loot Boxes Gaming

MPs have called for loot boxes to be classed as gambling and regulated.

A group of MPs from the Digital, Culture, Media and Sport (DCMS) Committee have called for loot boxes to be banned from being purchased by children. The MPs also want loot boxes to be regulated under the 2005 Gambling Act and have urged games companies and social media platforms to implement age verification tools to enforce any potential future bans.

Loot boxes are items in video games which are purchased with real money and provides players with an assortment of in-game items such as additional weapons, power-ups or skins. However, the contents of a loox box remain hidden until the item is purchased by a customer. At the time of writing, loot boxes cannot be defined as gambling under current laws as the items won do not have monetary value.

The call for regulation came in the DCMS Committee’s report on immersive and addictive technologies that was published today (September 12th) following several months of hearings with gaming and technology firms. The report explains that the Committee heard evidence that loot box winnings can be exchanged for money.

Labour’s Shadow DCMS Minister Tom Watson said the report’s findings suggest a revamp of Tony Blair’s Gambling Act 2005. He said: “This echoes the Labour party’s long-standing position on loot boxes. However, making changes to the existing legislation will not be enough. We need regulation that is fit for the digital age, and this will require a whole new Gambling Act.”

Committee Chairman Damian Collins said in a statement: “Loot boxes are particularly lucrative for games companies but come at a high cost, particularly for problem gamblers, while exposing children to potential harm. Buying a loot box is playing a game of chance and it is high time the gambling laws caught up. We challenge the government to explain why loot boxes should be exempt from the Gambling Act.”

Loot Boxes And Gambling: A Strained Relationship

Last year, loot boxes were classed as gambling in Belgium. As a result, the Belgian government ordered video game developers to remove loot boxes from their games in the country. EA Games, a prominent game developer best known for its FIFA and The Sims franchises, faced an investigation after refusing to remove loot boxes from its FIFA 19 game.

Meanwhile, a study by the Australian Environment and Communications Reference Committee claimed last September that video game loot boxes are “psychologically akin to gambling”. The study found that gamers who suffered from problem gambling were more likely to purchase loot boxes and it suggested that loot boxes could act as a gateway to problem gambling in children.

More recently, in July this year, UK Gambling Commission’s Chief Executive explained that loot boxes cannot be classified as gambling under current laws. Speaking at a session with the DCMS, Neil McArthur explained:

“The Gambling Act tells us that gambling means playing a chance of chance for a prize, and you can certainly see circumstances where a loot box might fall with that definition, but where things become a bit more complicated are where one looks at the definition of prize, and prize is defined as being money or money’s worth.”

However, a further statement from the Commission’s Programme Director Brad Enright suggested that the Commission was ready to begin regulating loot boxes when the current gambling law is amended to encompass them.

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