Global Loot Box Regulations in 2024: An Updated Overview

This article revisits the global regulatory landscape of loot boxes, with a focus on recent developments and updates. The controversy surrounding loot boxes has led to various countries imposing distinct requirements, primarily centered on disclosure of loot box presence in product listings and advertising, probability disclosures, and minimum age ratings for games featuring loot boxes. These regulations stem from consumer protection laws or newly introduced dedicated regulations. For those interested in previous rules, the 2022 and 2023 editions of this series are available for review. Unless otherwise stated, the existing rules remain in effect. Further details on loot box regulation can be found in Section 2.2 of my PhD thesis, with source materials compiled in a repository for review. The term 'loot boxes' broadly encompasses in-game purchases with randomized elements bought with real-world money or premium in-game currency. This includes gacha mechanics and social casino games. Some companies remain non-compliant with Belgian gambling law, which prohibits loot boxes. Recently, Pokémon Unite decided to comply by disallowing in-game purchases by Belgian players and plans to withdraw services from the country entirely. The Belgian gambling regulator faces challenges in enforcing the ban but may criminally prosecute non-compliant companies. Advertising for games with loot boxes should not target Belgian users to ensure legal compliance and avoid wasting advertising costs. Following a 2022 court decision, paid loot boxes are lawful in the Netherlands, but companies must comply with overarching consumer protection law. The Dutch consumer protection regulator has published guidelines, and non-compliance can result in fines, as seen in the case of Epic Games. Consumer protection law requirements include disclosing loot box presence in advertising and providing probability disclosures. These requirements have been enforced by the European Commission and are applicable in the Netherlands, Italy, and the UK. The forthcoming EU Digital Fairness Act is expected to regulate loot boxes and in-game currencies better. Players have successfully claimed refunds for loot boxes from the FIFA and Counter-Strike series, with contracts deemed illegal due to contravening gambling laws. However, other cases have failed, and an appeal to the Supreme Court is pending. In Germany, all games with loot boxes have been rated USK 12, and companies should prepare for this rating. The USK has confirmed that digital app storefronts will automatically receive a minimum USK 12 rating for games with loot boxes. In contrast, PEGI and the ESRB merely highlight loot box presence without accounting for it in age rating decisions. The Australian Classification Board has introduced a rule requiring games with loot boxes to receive a minimum M rating, while games with simulated gambling mechanics will receive an R 18+ rating. The simulated gambling rule applies to games with interactable simulated gambling mechanics, even if they do not involve real-world money. Companies should carefully consider portraying traditional gambling in their video games. In China, companies must disclose loot box probabilities to comply with consumer protection law, with a fine imposed on the Shanghai-based company behind Survivor.io for non-compliance. In Taiwan, probability disclosures must be presented as percentages, and a specific message must be displayed. South Korea has published detailed guidance on probability disclosures, requiring exact probabilities and forcing companies like EA to publish better disclosures. The UKIE industry self-regulatory principles on loot boxes became effective in July 2024, but many popular games failed to comply. The UK advertising regulator has upheld complaints against companies failing to disclose loot box presence, and companies are urged to ensure compliance to avoid stricter regulation. In Ireland, the Advertising Standards Authority for Ireland has required app store listings to disclose loot box presence but ruled that social media advertising need not disclose if it links to a store listing with disclosure. Companies are advised to make disclosures on social media ads to treat consumers fairly. Draft laws intending to regulate loot boxes have been published in various countries, including a new draft law in the UK aiming to ban paid loot boxes with transferable rewards for under-18s. Companies should seek independent specialist legal advice to ensure compliance with the increasingly complicated regulatory landscape.