Introduced for the first time in April 2006, MT systems have been embraced by various game operators. And even though players were never enthusiastic about them, they did not disapprove of loot boxes. The straw that broke the camel’s back was the release of Star Wars Battlefront II in the end of 2017. Gamers increasingly started accusing EA of promoting gambling and pushing players to purchase loot boxes if they wanted to get the most from the game.
Since November 2017, governments, gaming industries, and players have ardently been expressing their views on the loot box matter, with the discussion being primarily centered around whether or not loot boxes should be viewed as gambling.
Essentially, loot boxes are in-game purchased virtual crates, containing in-game content. And, even though players get a reward with every loot box (unlike casino games), some European governments have declared them are in violation of gambling laws. Not long ago, the Netherlands and Belgium banned loot boxes.
The Problem With Loot Boxes
According to CasinoGuardian.co.uk there are some features of loot boxes which make them largely the same as slot games in casinos in terms of design. First of all, loot boxes feature flashy openings, which entices players. Secondly, loot boxes feature an element of surprise which is largely the same as the element of surprise in casino games. The thing is, loot boxes yield random prizes, most of which totally useless. Every now and then, however, a loot box will yield a valuable item, inviting players to keep on buying in order to get another valuable item. Last, but not least, some loot boxes feature “almost winning” effects which, again, is largely similar to casino slot games’ ‘almost winning’ effects.
The Netherlands Ban
Realising that dangerous gambling techniques are implemented in video games, where youngsters have access to them, the Netherlands was the first country to ban loot boxes. An examination conducted by the Dutch Gaming Authority has resulted in the state’s announcement of a deadline for game publishers to modify or remove the “addiction-sensitive” elements in loot boxes.
In April 2018, the Gaming Authority in the Netherlands announced that, after having looked into 10 video games, it found four to be in violation of the Betting and Gaming Act. In a statement, the Gaming Authority announced that the content of the loot boxes in these games was determined by chance and that the rewards could be sold outside the game. This element is crucial as it means that virtual items have market value, which essentially violates Dutch gambling laws. In their conclusion, the authority said that “offering such type of games of chance to Dutch players is illegal without a gambling license”.
The Dutch Gaming Authority did not reveal the names of the games which violate the country’s Betting and Gambling Act, but gave game developers a deadline of June 20 to change their game content or they could be punished. What is more, the Gaming Authority emphasized that the loot boxes on all games which were studied could be addictive.
Just a week after the Dutch Gaming Authority announced their decision, Belgium followed suit. FIFA 18, Overwatch, and Counter-Strike: Global Offensive were found to be in violation of Belgium gambling laws. What is more, if developers do not remove gambling-related content from their products in time, they will face fines of up to €800,000 and up to five years in prison.
Minister Geens expressed his concerns about loot boxes’ impact on youngsters, saying that it is exactly children who come in contact with MT systems. Emphasizing that loot box systems may affect children’s mental health in a terrible way, the minister said that game developers will face harsher punishments if children are affected by their products.
The Belgium Gaming Commission looked at two factors to determine if loot boxes were in violation of Belgium gambling laws – whether a purchase led to a loss or a profit and whether the outcome of the “bet” was based on luck or skill. Under these factors, games FIFA 18, Overwatch, and Counter-Strike: Global Offensive featured elements of games of chance in their loot box systems, which violated the country’s gambling laws.
The Belgium Gaming Commission also looked into Star Wars Battlefront II. However, EA made adjustments to their MT systems shortly after the game release, excluding all game of chance elements.
EU-wide Ban on Loot Boxes
One day after announcing that loot boxes in certain games are in violation of the country’s gambling laws, the Netherlands Gaming Authority made a statement saying it wanted to “work and act together” with other EU member states to achieve joint EU regulations over loot boxes. The Netherlands Gaming Authority representatives campaigned for joint actions on the matter of loot boxes and expressed their desire to work together with other nations in order to establish a precedent, despite that each EU member state has their unique laws and regulations.