EU study recommends taking on lockboxes as a consumer issue rather than a gambling issue

        
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    This is someone else's problem.

    As much as the companies using them to make bank might want them to, the discussions around lockboxes are not going away. And a new study from the EU Internal Market and Consumer Protection committee brings up a point that those companies would really rather not hear. Rather than discussing lockboxes under the header of gambling, the study argues that it makes more sense to discuss these issues and potentially legislate by marking lockboxes not under gambling laws but from a consumer protection perspective.

    Those of you who have been following the ongoing discussion no doubt recall that some countries in the EU have already classified lootboxes as being gambling mechanics, which has prompted the studios thus cited to simply remove the option to purchase currency within those countries without making any further changes. Furthermore, the EU as a whole does not control the gambling laws of its member nations. But the study lays out a case for these practices as being harmful and anti-consumer, which does have quite a bit more teeth. Check out the full rundown; it might contain some familiar points, but it’s a sign that people watching the game industry are not mollified by a change in rating labels.

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    Techno Wizard
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    Techno Wizard

    Remember when it was about simply enjoying a game? Let the nanny state establishment in and kiss your “can have nice things” leisure and hobbies good bye as the nanny state tells you “you can’t have nice things” and uses any reason they can to do that by messing your fun up.

    Parents should be the supervisor of things like lockboxes for offspring that require parental consent, and not the nanny state. Anything different from that and the interference from the nanny state will deliberately be out to wreck adults fun by using younger generations as a control mechanism of adults activities with legislation. What’s worse is we are paying the nanny state to do that to us with our tax money. Bleh.

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    bobfish

    The “nanny state” as you put it, hasn’t stopped adults from having fun with gambling. It is just carefully regulated to ensure that only adults have fun with it, not children, and that the companies who pursue it don’t overly exploit those that enjoy it.

    Even with regulation, the gambling industry brings in nearly $400 billion in revenue globally, compared to video games at $180 billion.

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    Arktouros

    It’s heavily regulated because anything involving exchanging money typically is. All the money being exchanged when you gamble is taxed as earnings and needs to be kept track of purely for those kinds of purposes. It would also be incredibly easy if gambling wasn’t as regulated for the purposes of laundering money and other similar style issues. The government wants their cut. As for those companies who offer gambling services don’t persue it? What? Have you never been to a casino there’s ATMs everywhere to let you piss away your life savings in a blink of an eye. Again the government doesn’t care…so long as it gets it’s cut.

    Know where they typically don’t get their cut from? Children. People would 100% bring their children along if it wasn’t illegal to say the kid won the earnings even if it was just to split the taxes between two people. Protecting children from Gambling has virtually nothing to do with the regulation in place. It’s a nice thought, but it’s all about the money.

    While we’re aware of problem gambling, the fact is that they make up roughly 0.6% – 1.1% of the adult population. There’s very little to no research that says exposure to problem gambling will create problem gamblers, but certainly it would expose those who are problem gamblers that aren’t normally exposed to it. This is what most of the researchers who have been consulted on the topic of lock boxes have stated as well. Almost nothing in our societies is done to prevent them gambling to protect them other than simply benefiting from the heavy regulation due to finances.

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    Schmidt.Capela

    It’s not just about taxing income, at least when you look at the EU regulations. There are regulations about what kinds of gambling can exist, how much can be wagered at once, transparency, various aspects of the experience (to reduce the psychological reinforcement elements), who can gamble (often excluding whole categories of persons, such as Belgium banning gambling by everyone in judicial and police careers), etc. The regulations related to guaranteeing winners pay their taxes are just a small fraction of gambling regulations in much, if not all, of the EU.

    The EU tends to go far further in protecting people from themselves, and from big companies and external governments, than the US. Heck, the ECJ has recently made null and void the provision that allowed US-based companies to process personal information from EU citizens because said companies lack the legal ability to block demands by the US government to access that data.

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    Arktouros

    I looked at EU regulations on gambling and surprise, surprise they don’t actually exist. EU members can create their own gambling regulation laws so long as it doesn’t run afoul of TFEU. In fact that’s the whole point of this article is that the EU doesn’t create gambling regulation, but it could create consumer protection regulation.

    Excluding people like Judges and Policemen from gambling is again an example of a financial reason because the implications there for bribery, a financial crime, are obvious. And yes, EU does go out of it’s way to protect it’s citizens with creating consumer projection and give people control over their data. Except for gambling. Because gambling regulations are for financial reasons and not for protection :)

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    Schmidt.Capela

    When I said EU regulations, I meant each individual country’s regulations; each EU country has extensive gambling regulations describing which kinds of gambling are allowed, who can operate them, how they can be run, etc. It’s why when I gave a specific restriction I mentioned the country that implements it.

    The Netherlands, for example, regulate just about everything related to gambling, including the kinds of gambling that can be offered (there’s a strict list), how much each patron can spend per day and year with each kind of gambling (in some cases even having different limits depending on the patron’s age), how large the wagers can be, how much of the wagered amount must be set aside for the prizes, specific aspects of the gambling activity (such as a strict limit on how often a slot machine can be played), etc.

    The fact each country has extensive gambling regulations, and had them in some way or another since before the EU started harmonizing laws and regulations, weights heavily on why there’s no EU-wide gambling regulation, mind; the political work needed to harmonize all the gambling laws of the 27 EU countries, which often differ greatly (with, for example, different kinds of gambling altogether allowed in different countries), would be enormous.

    BTW, the Belgium regulation I mentioned doesn’t stop at justice and law enforcement professionals; it also includes minors, people who voluntarily choose to be banned from gambling, people with delinquent debts, and people who have been added to the denied list at the request of others when there’s a reasonable cause (impulse control issues, impaired judgement, etc). In Belgium you can, for example, ban at will anyone you are the legal caretaker of from gambling, or cause family members with gambling issues to be banned even against their will.

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    Arktouros

    There’s a big distinction when you specify EU vs the nations that make up the EU however as those smaller countries represent an even smaller percentage of peoples when taken at a world view.

    This is why special rules in Belgium with lock boxes are entirely ineffective and have had zero impact. This is in spite of everyone saying Belgium was the “heart” of the EU’s legal directions and surely those dominoes would fall in line with them.

    Pointing to one country who may have extensive anti gambling legislation but makes up basically a tiny percentage of the world population (if you want to compare the world) is just myopic.

    Techno Wizard
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    Techno Wizard

    I can see how it will go in the end. Underground as usual, and regulation becomes useless. So be it.

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    bobfish

    If loot boxes go underground I’m fine with that, cause it means they won’t be in any game released on console, Steam, Epic or other major platform.

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    traja

    This makes a lot of sense to me in principle. The problem here is that we have a simple way to philosophically define “gambling”: If you are risking something that you value for a chance to gain something else that you value, then you are gambling.

    That definition to me seems almost perfect but it is nearly impossible to write as a law that makes sense. It’s just entirely too subjective. So gambling laws have to try to capture what some statistically significant portion of their community experiences as gambling. That process will never be perfect and it will never be able to keep up with the speed of innovation from the business side of this.

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    Arktouros

    Personally I’m far more behind this kind of movement and direction because it’s more honest and forthright at the issues people have with Lock Boxes. Trying to use gambling and gambling laws to regulate lock boxes because people see them using predatory, anti-consumer practices has always been an odd way to get what you want. It’s fraught with technical definitions and legalese that will allow many of those efforts to be entirely wasted or side stepped and circumvented. Movements like this will not only address current monetization strategies but also potential future adaptations like we see with examples like Black Desert where they’ve moved the RNG into the game itself and base their monetization strategy on selling ways to cope with bad in game RNG mechanics.

    What I am mostly curious about is how these kinds of principles would be legally, specifically defined. For example many industries on the consumer end of things will use all sorts of psychological tricks and otherwise for the purpose of marketing and selling products. What, specifically, would make the lock boxes and other similar such business models cross that line into the field of being considered predatory and not allowed?

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    traja

    This is of course incredibly complex in reality and each country has their own complexities to consider. So I’m not suggesting some universal solution but you could, for example, legislate that all transactions that directly or indirectly involve randomness, or pseudo randomness, are subject to some separate refund policy that is defined elsewhere.

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    Schmidt.Capela

    Actually, one of the big upsides in EU about tackling it as a consumer protection issue is that the EU itself can create new EU-wide consumer protection rules, whereas using gambling laws would require each country to implement their own individual laws. Thus, if the EU Commission/Parliament (not sure which has the power here) passes consumer protection rules banning lootboxes, it’s game-over for that business model across the whole of the EU.

    From what I’ve seen it’s unlikely to be a blanket ban, BTW; instead, the intent seems to be banning the use of psychological tricks to get players to spend more money (or even time) with the game than they intend, together with age restrictions, information availability requirements (publishers would be forced to divulge every bit of information about how those random rewards are awarded), greater transparency about the available micro-transactions (so players can find the full list of such transactions before starting to play), etc.

    This, incidentally, might also put restrictions on Season Pass schemes such as used by Fortnite or FO76; the report suggests that anything that would require players to treat the game as a second job in order to get all rewards without spending money has clearly crossed a line.

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    bobfish

    I imagine it could be handled something like this “the cost of a virtual item must be clearly communicated before point of purchase; virtual currency, gacha mechanics and other steps between the purchase point and the end item desired, must not obfuscate the cost communicated before purchase”.

    Then with some clear lines covering the consumers purchase intent, ie they want Item X from loot boxes, therefore it is Item X that must have a cost associated with it, bot the soft currency or loot box it comes from.