Report: EU should tackle loot boxes through consumer protection legislation

Loot boxes have proved rather resilient in the face of attempts by the EU authorities to regulate them through gambling legislation. In the countries that classified loot boxed as a gambling mechanic, such as Belgium and the Netherlands, publishers simply made the in-game currency unavailable while keeping it elsewhere.

At the European scale, legal frameworks are just “not sufficiently harmonised” between EU member states to make the gambling approach universally effective. This is further aggravated by the fact that individual studies have struggled to link gaming to gambling, especially when no real-world money is involved.

A new take on the problem of loot boxes is outlined in a new report commissioned by the EU Internal Market and Consumer Protection committee. It is titled ‘Loot boxes in online games and their effect on consumers, in particular young consumers.’ The paper states that the EU has the authority to regulate consumer protection legislation across the single market. That is why, according to IMCP, loot boxes should be approached from a consumer protection perspective rather than a gambling one.

It makes all the more sense since the paper views loot boxes in a more general context of problematic game design and in-game monetisation methods which can also appear in video games independently of loot boxes. Battle passes are another such problematic game design criticized for monopolising a player’s time.

The paper recommends the following consumer protection policies to address the problem of questionable mechanics:

• raising awareness about the risks of loot boxes;

• restricting advertisements targeting minors;

• informing the consumer that a game includes loot boxes or disclosing the probabilities of winning;

• refund policies;

• player control measures, and specifically, parental control measures.

The paper emphasizes though that the effectiveness of these initiatives should be verified, for example, through consumer testing. Thus, further research is needed.