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Introducing DLA Piper’s comprehensive global guide to loot boxes laws, addressing the complexities of loot boxes regulations worldwide in video gaming.
Lurking within the digital realm of video games, loot boxes are tantalizing troves of chance. They offer players an enigmatic assortment of rewards that will either embellish their virtual avatar or dramatically reshape the gaming landscape by unlocking hidden content or enhancing their in-game prowess.
The concept of loot boxes, especially those earned through in-game achievements, has been part of the gaming universe for generations. But the introduction of real-world currency into this equation is a modern twist. And it has ignited a maelstrom of controversy and regulatory scrutiny. This is largely because of the randomized nature of these digital assets and the similarity to traditional gambling.
The primary regulatory reaction to the loot box conundrum has been to scrutinize them under the microscope of existing gambling laws, seeking to pigeonhole them into this category if the criteria fit.
But a universally accepted standard of consumer protection regarding loot boxes remains elusive. Regulatory bodies around the world are divided in their approach to labeling loot boxes as gambling and managing the intricate web of microtransactions. Some regulators focus on whether these transactions fit the legal definition of gambling. Others adopt a more encompassing stance towards consumer protection.
Views also vary on whether in-game items hold monetary value or can be cashed out, a requisite element of gambling, and if loot boxes induce psychological harm like that caused by traditional gambling.
How far should regulatory control extend in the name of consumer protection?
Moving beyond the confines of existing gambling laws, it’s crucial to approach the regulation of loot boxes through a holistic lens of consumer protection, aiming for more exhaustive safeguards.
A range of gaming design measures can be employed to mitigate potential harm to consumers: the disclosure of odds for potential rewards, setting maximum spending limits, and eliminating the option to cash out. Navigating the practicalities of implementing and enforcing these regulations will undoubtedly pose a formidable challenge in the near future.
It’s vital to recognize that both regulations and regulators’ perspectives can vary dramatically depending on jurisdiction. This evolving landscape can lead to an increasingly complex environment for businesses to navigate, especially as the scrutiny from authorities escalates exponentially.
DLA Piper colleagues from several jurisdictions have written this global guide on laws applicable to loot boxes in video gaming to help our clients through this dynamic regulatory terrain, ensuring they’re informed and confident in their gaming endeavors. Our goal is to provide the necessary tools and insight to facilitate their journey through an industry that is under constant and intense review by various regulatory authorities.
You can access to the guide HERE and watch a video of presentation below
Authors: Giulio Coraggio and Vincenzo Giuffré
On a similar topic, you can read the article “Austrian court qualifies loot boxes as gambling leading to a potential Far West“.