Regulate loot boxes under gambling law and ban them from children, MPs say

Loot boxes in video games should be regulated under gambling law and be banned from being sold to children, MPs have argued.

The feature appears in some games as packs of virtual objects players can buy using real money, but the contents of a pack are randomised and not known until after purchase, which has led to fears that it could act as a gateway to gambling for young people.

It is thought to be an integral money-maker for major games companies, generating billions in revenue.

A report published by the Department for Digital, Culture, Media & Sport committee (DCMS) outlines a number of key recommendations for the Government to deal with the issue, and calls on game makers to accept responsibility for addictive gaming disorders.

In its evidence, one gamer told the committee they spent up to £1,000 a year on EA’s Fifa football game for a chance to get better players.

Committee chair Damian Collins MP pointed the finger at game companies and social networking sites for their “relentless battle to capture ever more of people’s attention, time and money”.

He said: “Their business models are built on this, but it’s time for them to be more responsible in dealing with the harms these technologies can cause for some users.

“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.”

The report says it “struggled to get clear answers and useful information from companies across the games industry”, describing them as “wilfully obtuse”, but hopes the inquiry will focus minds on the potential harms.

Nancy Pelosi
The report also calls for action to tackle deepfakes, such as one that went viral of speaker of the US House of Representatives, Nancy Pelosi (Liam McBurney/PA)

MPs have called on the Government to force gaming firms to disclose aggregated player data with researchers and to help finance an independent research through a levy.

The committee also expressed concern at the rise of deepfake videos, which it warned could be used to influence the outcome of elections.

It urged the Government to include deepfakes as part of the duty of care principles as set out in the online harms white paper.

“Social media firms need to take action against known deepfake films, particularly when they have been designed to distort the appearance of people in an attempt to maliciously damage their public reputation, as was seen with the recent film of the Speaker of the US House of Representatives, Nancy Pelosi,” Mr Collins added.

In response to the report, UK Interactive Entertainment, the country’s gaming trade body, said the industry will continue to put the welfare of players first but admitted “a minority” struggle to find balance.

“We will review these recommendations with utmost seriousness and consult with the industry on how we demonstrate further our commitment to player safety – especially concerning minors and vulnerable people,” said Dr Jo Twist, chief executive of the organisation.

“We are pleased the committee acknowledges that the majority of people play video games in a positive, safe and responsible way.

“The industry does not dispute that, for a minority, finding balance is a problem.

“This is why we are vocal in supporting efforts to increase digital literacy and work with schools and carers on education programmes.

“The discussion around age ratings is actively ongoing and the system is continually reviewed.

“Changes have already been made including the introduction of an in-game purchase description label and as technology evolves so will the robust process by which it is reviewed and rated.”

The Gambling Commission said: “In our evidence to the select committee we set out our view that under current legislation loot boxes could only be caught as gaming under the Gambling Act where they offered a prize of money or money’s worth.

“For all loot boxes to be classed as gaming under the Gambling Act there would need to be a change to primary legislation.”

“We take concerns around excessive or gambling-like behaviour in video games seriously. Children and vulnerable people must be protected from harm and we will consider the Committee’s report carefully before responding.”

The Government said it takes concerns seriously and “will consider the committee’s report carefully before responding”.

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