Thus far, the fight to regulate video game loot boxes has been a piecemeal effort moving forward in very different ways in different jurisdictions. Today, though, an international group of regulators from 15 European regulation bodies and Washington state in the US signed a declaration stating their increasing concern “with the risks being posed by the blurring of lines between gambling and other forms of digital entertainment such as video gaming.”
The declaration identifies four specific areas of concern:
- Skin betting—Third-party sites that allow users to wager money or in-game items for a chance at earning better items. Valve has already faced pushback from Washington State regulators for Steam’s role in “facilitating” such skin-gambling schemes.
- Loot boxes—In-game purchases that offer randomized rewards. Some loot boxes have already been ruled as illegal in the Netherlands and Belgium, and there have been some attempts to do the same from some US lawmakers.
- Social casino gambling—Apps like Big Fish Casino in which users can optionally spend money on virtual gambling chips if they don’t feel like waiting for the in-game currency to replenish. A US District court ruled Big Fish Casino constituted illegal gambling earlier this year, and there are multiple active lawsuits surrounding other such games.
- “The use of gambling themed content within video games available to children.”—In addition to the above, this would seemingly apply to games with poker or slot-machine-style minigames (or, uh, Casino Kid for the NES).
The declaration says that the types of games and services listed above have “similar characteristics to those that led our respective legal frameworks and authorities to provide for the regulation of online gambling.” But the signatories don’t commit to any specific actions against such games for now, beyond “working together to thoroughly analyze the characteristics of video games and social gaming.” The declaration also notes that there are different frameworks for gambling regulation in different countries.
The regulators also hope to “enable an informed dialogue with the video games and social gaming industries,” and say they “anticipate that it will be in the interest of these companies whose platforms or games are prompting concern, to engage with [gambling] regulatory authorities to develop possible solutions.” This could be a veiled reference to Electronic Arts, which was recently referred to Belgium’s public prosecutor for failing to heed that country’s loot box regulations.
The declaration is notable for its international reach, encompassing European countries with a population of greater than 278 million people or about 54 percent of the entire European Union population. The UK’s involvement is particularly notable, considering a 2017 position paper in which the country’s Gambling Commission determined loot boxes were not a form of gambling if those in-game items could not be traded back for real-world currency.
“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,” UK Gambling Commission Chief Executive Neil McArthur said in a statement. “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.”
The signatories to the declaration are:
- Austria: Alfred Hacker, director, Federal Ministry of Finance
- Czech Republic: Karel Blaha, director of the State Oversight Over Gambling Department
- France: Charles Coppolani, chair of the French Online Gaming Regulatory Authority
- Gibraltar: Andrew Lyman, executive director, Gambling Division, HM Government of Gibraltar
- Ireland: Brendan Mac Namara, principal officer, Gambling Policy Division, Department of Justice and Equality of Ireland
- Isle of Man: Steve Brennan, chief executive, Gambling Supervision Commission
- Jersey: Jason Lane, chief executive, Jersey Gambling Commission
- Latvia: Signe Birne, director of Lotteries and Gambling Supervisory Inspection of Latvia
- Malta: Heathcliff Farrugia, chief executive officer, Malta Gaming Authority
- The Netherlands: Jan Suyver, chair of the board of directors of the Netherlands Gambling Authority
- Norway: Henrik Nordal, director deputy general, Norwegian Gaming Authority
- Poland: Paweł Gruza, undersecretary of state in the Ministry of Finance
- Portugal: Teresa Monteiro, vice president of Turismo de Portugal, I.P
- Spain: Juan Espinosa García, CEO, directorate general for Gambling Regulation
- Washington state: David Trujillo, director, Washington State Gambling Commission
- United Kingdom: Neil McArthur, chief executive officer, UK Gambling Commission