Navigating the regulatory maze: A global guide to loot boxes in video gaming

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes and No (contradictory case law at the moment)

Have loot boxes been challenged under consumer protection legislation?

Yes

Brief overview of the situation for loot boxes in your jurisdiction

Loot boxes are not specifically regulated in Austria. It is currently pending whether Austrian courts qualify loot boxes as gambling services according to the definition of "gambling" in the Austrian Gambling Act. At present, there is only first and second instance case law that qualifies loot boxes as gambling within the meaning of the Austrian Gambling Act. The Supreme Court has not yet issued a ruling on loot boxes.

The qualification of loot boxes as games of chance depends on various aspects, such as their specific design, the extent to which they are integrated into the specific game, the way they are purchased (i.e. by watching advertisements, etc.) and whether the digital content can also be achieved with a "regular" gaming effort.

Austrian doctrine bases its assessment, inter alia, on whether the prize of the loot box can be resold/transferred outside the gaming platform and thus a "profit" can be made with the virtual good. However, an appeal decision (second instance) has recently ruled that the existence or even absence of a secondary market alone is not decisive for the assessment.

Ultimately, either a new regulation or a (at best, supreme court) ruling will clarify whether and how loot boxes shall be qualified as gambling within the meaning of the Austrian Gambling Act.

Contacts: Claudine Vartian, Armin Redl and Nicole Daniel

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

Loot boxes are predominantly unregulated in Australia as they do not fall within the definition of “gambling service” in the Interactive Gambling Act 2001 (Cth).

However, following an enquiry by the Senate Environment and Communications References Committee into ‘Gaming micro-transactions for chance-based items’, the Classification (Publications, Films and Computer Games) Amendment (Loot Boxes) Bill 2022 was tabled in Australian Parliament on 28 November 2022.

If this becomes law, it will require games containing loot boxes to have adult classification (which will also require retailers and digital distributors to verify the age of all purchasers) and display warnings on the packaging and digital store fronts stating that the game contains loot boxes.

Contacts: Kit Lloyd and Sharon Zhang

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes, if they include all four constitutive elements of a game of chance as set out in article 2(1) of the Act of 7 May 1999, on games of chance, betting, gaming establishments and the protection of players (the Gambling Act), being: (i) a game element; (ii) a wager (bet); (iii) chances of wins and losses and (iv) chance.

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

In its report dedicated to in-game loot boxes issued in 2018 (What are loot boxes? | Gaming Commission), the Gaming Commission concluded that such loot boxes can qualify as games of chance subject to the Gambling Act. The Gaming Commission examined loot boxes in four video games and found that three of them qualified as games of chance, which are banned in Belgium other than the exceptions provided for by the Gambling Act, and were therefore in violation of the latter.

In its report, the Gaming Commission also stated that, while the report focused on paid loot boxes, free loot boxes are also problematic if players are directed to paid loot boxes.

The Gaming Commission ruled that the paid loot boxes had to be removed from the video games in order to comply with the Gambling Act and, if the video games were not revised accordingly, the active operators risked a prison sentence of up to five years and fines of up to EUR800,000 for a first violation. These penalties could double if the violation was perpetrated against a person younger than 18. According to the Gaming Commission, any prosecution should in the first instance be against the operators of these games of chance and in a later phase also against those involved in operating the illegal game.

To conclude, the Gaming Commission issued a number of recommendations to different actors in the industry. By way of example, the regulator should develop specific permits for games of chance in video games, issue a principal ban on minors purchasing games with paid loot boxes and implement in-store age verification when codes or gift cards for video games are purchased. The granters of licenses should take into consideration quality standards (no illegal gambling, no promotion of match fixing, etc.) when granting licenses to game developers. Similar recommendations were formulated vis-à-vis game platforms that facilitate payments used in video games and distributors and game developers. However, to date, these recommendations have not yet been transposed in law.

Contacts: Alexis Fierens, Kaat Scheerlinck and Johan Vermeir

Are there dedicated regulations on loot boxes in your jurisdiction?

Not yet

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Not yet. There are Class Actions filed by a National Association of Teenagers and Children that is challenging the use of lootboxes (considered to be gambling) by videogame players in Brazil. We represent one of the Platforms in one of the Class Actions.

Have loot boxes been challenged under consumer protection legislation?

Yes

Brief overview of the situation for loot boxes in your jurisdiction

There is no provision under Brazilian law that expressly prohibits the marketing of electronic games that contain loot boxes. The acquisition of loot boxes is subject to the Consumer Protection Code and, therefore, subject to protective rules that impose the provision of clear and adequate information regarding product and its characteristics, avoiding predatory monetization. Brazilian law makes it difficult to categorize loot boxes as games of chance, especially because the classification as “game of chance” is restricted to the existence of the element of chance, and therefore considered an analogical interpretation in malam partem.

There are currently two Bills of Law in discussion with the Brazilian Congress. One does not consider the marketing of loot boxes as criminal but only as a random contract with the imposition of the duty of clear information to consumers regarding the probability of obtainment of the items being offered. As for the other project, it tries to completely banish the marketing of loot boxes to children and considers loot boxes to be games of chance.

Contacts: Felipe Hermanny and Beni Flint

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

There are a set of class action lawsuits which are current in progress which allege that certain loot box mechanics constitute illegal gambling under Canada’s Criminal Code; and in other respects, breach applicable consumer protection and marketing laws.

We note that no regulators have taken steps to regulate loot boxes as of writing.

Brief overview of the situation for loot boxes in your jurisdiction

There are currently no loot box specific regulations or proposed legislation in Canada. With that said, existing gambling, marketing, and consumer protection laws do apply to loot boxes and other similar mechanics.

Businesses are advised to ensure that in respect of paid loot boxes (whether directly for fiat or via a virtual currency that is purchased using fiat) that consumers are not able to resell or otherwise market any of the virtual items they receive from the loot box. This includes taking active steps to shut-down secondary markets and enforce applicable terms of service. Careful consideration must be taken regarding applicable gambling laws if the loot box rewards have any potential value.

While courts have yet to decide on whether and to what extent odds must be disclosed prior to purchase, it is recommended that this is done at time-of-purchase, as part of a terms of service.

Contacts: Ryan Black and Tyson Gratton

Are there dedicated regulations on loot boxes in your jurisdiction?

No. However, is important to note that on January 2021, the situation of this lack of regulation was exposed in the National Congress by means of an official document titled Video Games Loot Boxes Only a Game or Gambling?.

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

The loot boxes have not been challenged under consumer protection legislation, since the Law No. 19.496 (Consumer Protection Law) only refers to physical commercialization of videogames, but not to in-game purchases.

Brief overview of the situation for loot boxes in your jurisdiction

Currently, loot boxes are not specifically covered by Chilean legislation. This kind of transactions are outside the legal regulation for the following reasons: 

1. in Chile, debts contracted in games of chance are prohibited, unless expressly authorized by law (Article 1466 of the Civil Code). However, regarding prizes of loot boxes that cannot be valued in real money, it could be argued that there is not an onerous transaction, and therefore qualified as a “debt contracted in a game of chance” (such as gambling).
2. in Chile there is no ad-hoc agency entitled to oversight this, since the Superintendence of Gaming Casinos does not have powers in videogames matters, but only physical casinos matters. 

Notwithstanding it is possible that in the medium term the situation will begin to be discussed, especially considering that (i) the regulation of online casinos (also not currently regulated) is being strongly discussed, which may accelerate the thought of regulating other digital markets with similar impacts; and, (ii) the growth of the video games market by its very nature, could bring consumer claims.

Contacts: Pablo Gonzalez and Diego Peña

Are there dedicated regulations on loot boxes in your jurisdiction?

Yes

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes (in some cases, and when loot boxes do not comply with the principles discussed in Q4)

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The 2016 Ministry of Culture Notice on Regulating Online Game Operations and Strengthening Interim and Post-event Supervision Work is the key regulation on loot boxes (this Notice has been abolished, but it is still adopted by the regulatory authorities in practice). The regulation establishes several basic principles on loot boxes:

• Online game operating companies that provide virtual props and value-added services through random selection must not require users to participate in the form of direct investment in legal currency or online game virtual currency.
• Online game operating companies should promptly announce the name, performance, content, quantity, and probability of extraction or synthesis of all virtual items and value-added services that may be drawn or synthesized on the official website of the game or on the random selection page. The published random selection information shall be true and effective.
• Online game operators shall publish the random selection results of participating users on the official website of the game or in a conspicuous position within the game, and keep relevant records for inquiries by relevant departments, and the records shall be kept for no less than 90 days.
• Online game operating companies shall not provide users with the service of exchanging online game virtual currency for legal currency or real objects, and shall not provide users with services for exchanging virtual items for legal currency.

Loot boxes that do not comply with the above principles may be considered a violation, or even identified as a gambling game, and be punished and removed from the network.

Contacts: Windson Li

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

There is no loot box regulation/proposed legislation in place.

The Czech Republic does have a regulatory framework for gambling in place (Act No. 186/2016 Coll., the Gambling Act). However, the current definition of a game of chance would not cover loot boxes as they are generally understood. The gambling regulation is based on the following principles:

• Existence of a deposit (wager);
• The return of the wager is not guaranteed;
• Winning or losing in the game is (even in part) subject to chance.

Loot boxes do not fulfill the above criteria as they generally represent a purchase of (however random) digital content.

In fact, the Czech regulator (Ministry of Finance) has recently (2022) published material which indicates that the regulator does not in general consider loot boxes to fulfill the criteria of a game of chance. At the same time, the regulator expressed that this topic is currently heavily discussed and due to the underlying issues, it might be appropriate for the legislator to further analyze and consider whether this area should become regulated. At present time, there is however no concrete legislative initiative that would focus on the regulation of loot boxes.

Contacts: Jan Karabeles

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The Danish Gambling Authority (the DGA) is of the opinion that games which include loot boxes may be subject to the Danish Gambling Act if these criteria are met:

1. It involves a stake (money or similar of economic value)
2. There is an element of chance
3. It is possible to win a prize (the content can be converted into items of monetary value)
4. The game is provided or arranged in Denmark

The assessment of whether a game that includes lootboxes is subject to the Danish Gambling Act or not, is done on a case-by-case assessment by the DGA. Please see the DGA’s information page about lootboxes (and skin betting) on their website: Skin betting and loot boxes - Video gaming or gambling? | Spillemyndigheden.

There are no decisions from the Danish courts about whether lootboxes are subject to the Danish Gambling Act yet. However, the DGA has made a statement about lootboxes found in Star Wars Battlefront 2. According to the DGA the content of the lootboxes were not subject to the Danish Gambling Act, because it was not possible to convert the content into money or monetary values. Please note that the statement is from November 2017 and it can be found here in English: Statement about loot boxes / loot crates | Spillemyndigheden. In contrast, Counter Strike Global Offensive is subject to the Danish Gambling Act because content from lootboxes (such as skins) in the game can be sold on different websites and can be converted into money.

Contacts: Marlene Winther Plas and Daniel Bo Pedersen

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

There is no specific regulation related to loot boxes in Finland, they are always discussed in context. Depending on the legal point of view and the circumstances of usage of loot boxes, they can be classified as goods lotteries, (virtual) goods or services or gambling.

For now, loot boxes are not regarded as gambling within the framework of national legislation, although they have been found to have characteristics of gambling. According to the Lottery Administration of the Finnish Police Board, loot boxes offering prizes other than money cannot be considered gambling according to the Finnish Lotteries Act. Ultimately, general consumer protection legislation on the sale of consumer goods as intended by the Finnish Consumer Protection Act applies to loot boxes.

It is very possible that the authorities in Finland take action in the near future with respect to loot boxes and their status in the legal framework.

Contacts: Markus Oksanen and Antto Oksanen

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

No regulation in France explicitly prohibits loot boxes, but their legal framing is currently under consideration. The French National Gambling Authority (ANJ) intends to collaborate with the Directorate General for Competition, Consumption and Fraud Enforcement (DGCCRF) to take up the issue. It already considers that certain types of loot boxes could fall under the existing general lottery prohibition under French Law.

Lotteries are prohibited by the French Internal Security Code when the promotion thereof meets the following four tests:

• The lottery is offered to the public;
• It includes an expectation of a patrimonial / financial gain;
• It is carried via the intervention of chance;
• It demands from the customer a financial participation in any form.

The financial gain test may not be met by EA’s loot boxes since FIFA cards are not considered to be a financial or patrimonial gain under French regulation (according, in particular, to ANJ’s opinions). The legality of loot boxes is questionable when the prize is transferable outside the gaming platform: this requirement is generally not met in respect of loot boxes as most items acquired by players through loot boxes are used in-game, with no financial or patrimonial gain to be expected from players in return. The ANJ suggested to sort out the different practices in order to identify those that should or could be regulated but specified that it was “not possible to have a global position” on loot boxes given that, depending on the game, they may or not meet the conditions necessary to qualify as a money game.

Contacts: Frank Valentin and Anna Simhon

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

Yes (There seems to be two pending cases in which consumers argue they are entitled to a refund, as they claim the loot boxes they purchased constituted illegal gambling, but there is no official court statement yet)

Brief overview of the situation for loot boxes in your jurisdiction

There is no gambling legislation specifically addressing loot boxes, however the general definition of gambling applies (if the criteria are met). The Courts and the new competent “Joint Gaming Authority of the German States” have not yet classified loot boxes as gambling in general. There are provisions in the reformed Youth Protection Act that allow the responsible authority in certain cases to take into account the presence and design of loot boxes in games when age-rating a game and to label games accordingly. The Youth Protection Act also regulates advertising for microtransactions in games, including those involving loot boxes. Additional regulatory legislation is being discussed but is not specifically planned at the moment.

Contacts: Michael Stulz-Herrnstadt and Christoph Engelmann

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

There is no loot box regulation/proposed legislation in place. Loot boxes (depending on their specific features) may fall under the definition of gambling under Act 34 of 1991 on Gambling. However, there is no regulatory practice in Hungary.

Contacts: Zoltan Kozma and Mark Almasy

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

There is no express prohibition on loot boxes under Irish law currently.

There is a major reform of Irish gambling legislation forthcoming through the Gambling Regulation Bill 2022 (the Bill) which is currently making its way through Ireland’s Parliament. In its current, pre final form, the Bill does not make reference to loot boxes but there is scope for it to be further amended before it becomes law. The issue of loot boxes and their possible inclusion in the Bill have been raised by TDs (Members of Parliament) during debates in the Dáil Éireann (Lower House of the Irish Parliament) and during a Joint Committee on Justice concerning pre-legislative scrutiny of the Bill. As such, it is possible that restrictions on loot boxes may be included in the final Bill and become law if it is passed.

The Bill will establish the Gambling Regulatory Authority of Ireland (GRAI) as a new statutory body that will be responsible for the licensing and regulation of gambling services in Ireland. The new regulator will focus on public safety and wellbeing, will cover gambling online and in person, and will have powers to regulate advertising, gambling, websites, and apps. Should loot boxes be addressed in the final version of the Bill, the regulator may be a key decision maker in how restrictions/guidance on loot boxes is addressed.

Contacts: Mark Rasdale, Conor McEneaney and Lonan Manny

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

Yes

Brief overview of the situation for loot boxes in your jurisdiction

There is no loot box regulation/proposed legislation in place. However, the Italian Consumer Authority has set transparency standards for video games that contain loot boxes and in-game payments which affect the dimensions and the characteristics of the PEGI pictograms related to loot boxes and the descriptive mechanism of the functioning of the loot box, including information about the probability of obtaining specific game items. The information enhancements shall be accompanied by tools that allow parents to supervise the use of video games by children and adolescents and prevent unwanted purchases (e.g. parental control features and spending limits).

Contacts: Giulio Coraggio and Vincenzo Giuffrè

Are there dedicated regulations on loot boxes in your jurisdiction?

Yes

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The loot-boxes system is called “Compu Gacha” in Japan. Compu Gacha used to be a popular game system in the past (it was considered as kind of a grey area). However, since it has a nature of gambling, there were a lot of people (especially children) addicted to Compu Gacha and spent too much money on such games, and became a social problem. In response to this situation, the Consumer Affairs Agency disclosed its official opinion in 2012 stating that Compu Gacha, which a player can get rare items if the player successfully collects pre-determined several items randomly sold, violates the Act against Unjustifiable Premiums and Misleading Representations (the AUPMR).

The regulations imposed on loot-boxes game (Compu Gacha) shall apply to both foreign and domestic games if the game is intended to be used by Japanese residents.

Contacts: Tomomi Fujikouge and Shingo Okada

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The are no official regulations regarding loot boxes in place.

The Luxembourg law of 20 April 1977 provides that the operation of games of chance is prohibited, except for prize promotions referred to under article 21 of the Luxembourg law of 30 July 2002 (i.e. free lotteries, contests and raffles exclusively for commercial propaganda purposes). However, this law, which provided for the conditions to be fulfilled for the purpose of organizing prize promotions, was repealed by the Luxembourg Law of 23 December 2016 and the relevant provisions related to the operation of games of chance were never replaced. This means that the applicable law as it stands currently provides that such games are forbidden, without exceptions.

While in principles, loot boxes would be prohibited, in practice, there is no enforcement regarding the prohibition of games of chances and we see market players applying the provisions of the repealed 2002 Law as good practice, as no other legal sources are currently available on this subject.

Contacts: Olivier Reisch, David Alexandre and Camille Malécot

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The are no official regulations regarding loot boxes in place.

Games, bets and sweepstakes are mainly regulated by the Regulations of the Federal Law of Games and Sweepstakes (“Regulations”). The Regulations provides that slot machines are prohibited in Mexico in any of their modalities, and define slot machines as “any device, through which the user, subject to skill, placing a bet, by inserting money, a coin, an electronic device or any payment object, in order to obtain a prize, which is not determined in advance”. However, article 12 Bis of the Regulations provides certain exceptions to that general prohibition, which are the following: (i) vending machines that allow the delivery of goods or services in exchange for a price that corresponds to the market value of the goods or services that the machine delivers; (ii) jukeboxes, video or photographic discs, machines or devices for pure competition or sport, those for mere hobby or recreation and recreational machines or devices for children's use; all of them on the condition that their mechanisms do not allow any type of bet or gambling, or allow the payment of prizes in cash, in kind or signs that can be exchanged for cash or prizes in kind, except those that only consist of playing again for free or that grant prizes or coupons; and (iii) betting devices for equestrian and sports competitions, located in authorized establishments. In such connection, to the extent that loot boxes can be found within the definition of slot machine, it must be analyzed in detail if it falls within any of the exceptions provided in the Regulation.

Contacts: Jorge Benejam, Antonio Cardenas-Arriola and Aldo Ramirez

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The current position in Norway is that Loot Boxes could fall within the lottery definition If one can exchange the loot box (content) into real money or other objects of monetary value.

This has been upheld in the New Norwegian Gambling Act. However, the preparatory works emphasize that there is a high threshold for when the Gambling Act should include gambling-like elements in computer games. The gambling regulation shall cover gambling and not other types of gambling.

However also in Norway loot boxes are under scrutiny from the consumer protection authorities calling for regulation, which at least in Norway would be outside the Gambling Act.

Contacts: Petter Bjerke and Oscar Lorentz Melaa

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

Loot boxes, while not explicitly regulated in Poland, are the subject of arguments raised in the legal doctrine regarding the possible interpretation of online games incorporating loot-boxes as a type of ‘game of chance’, which is regulated under relevant gambling regulations and may be subject to state monopoly or license if such regulations would be applicable. However, currently such interpretation is unlikely to be used in practice - in 2019, the Ministry of Finance published a statement in which it was established that video games incorporating loot-boxes are not a ‘game of chance’ within the meaning set out in applicable law. While the position of the Ministry might change in the future and it would be recommended to monitor the regulatory landscape in this regard, currently the application of the gambling regulations to loot-boxes in Poland is not likely.

Contacts: Ewa Kurowska-Tober and Piotr Czulak

Are there dedicated regulations on loot boxes in your jurisdiction?

Not yet

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

At the time of writing, the loot box guidelines have not been issued yet. However, in August 2022, Singapore overhauled its gambling legislation and consolidated previously disparate legislation into one overarching Gambling Control Act, with a newly established central authority (the Gambling Regulatory Authority of Singapore (GRA)). There have been discussions on the possibility of introducing a value cap on loot boxes. We recommend keeping an eye on developments in Singapore, as the GRA has made it clear that loot boxes will be a regulatory focus for them.

Contacts: Yue Lin Lee

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

There are no loot box regulations/proposed legislation in place.

Loot boxes could theoretically fall under the current definition of a “gambling game” in accordance with Act No. 30/2019 Coll. on Gambling Games (Gambling Act) based on the following principles:

• paying a stake and placing a bet;
• possibility to obtain a prize (meaning an amount of money or other value in kind which the player can obtain in a gambling game);
• result is (even partially) subject to chance.

As players shall use real-world money to purchase loot boxes, this could be considered payment of stake. Because they contain randomized items and players do not know what they will get before opening, the condition of placing a bet would be also met at this point. Moreover, the result is unknown and depends on chance. It is however questionable whether the prize obtained in loot boxes could be considered as having some value in kind.

The Slovak Gambling Regulatory Authority is investigating the issue of loot boxes and is aware of the issue with protecting minors. However considering the lacking regulation, it can only determine whether a particular loot box fulfills the criteria of a gambling game on a case by case basis. Currently, there is no specific legislative initiative that would focus on the regulation of loot boxes.

Contacts: Daniela Koncierova

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

In Slovenia there is no loot box regulation/proposed legislation. Any action by the relevant authorities has yet to take place. A call for action, following the report published by the Norwegian Consumer Council in May 2022, has been sent to the Slovenian Market Inspectorate by the Slovenian Consumers’ Association. The call highlighted the main issues of loot boxes as a form of in-game purchases from the consumer protection law perspective (a new Consumer Protection Act, ZVPot-1, is in force since the beginning of 2023). Main issues include the exploitative, aggressive and misleading business practices, especially when targeting vulnerable audiences ie. kids and adolescents. Any regulatory and/or judicial reaction has yet to happen.

Contacts: Jasna Zwitter-Tehovinik and Domen Brus

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No

Brief overview of the situation for loot boxes in your jurisdiction

The are no official regulations regarding loot boxes in place.

There are two pieces of legislation that regulate gambling in South Africa: the Lotteries Act, 1997 (LA) and the National Gambling Act, 2004 (GA). These do not provide for “loot boxes” and the definition of “gambling games” in the GA is not wide enough to include “loot boxes” which leaves it largely governed by the Consumer Protection legislation. However, the provisions of the LA could potentially include a “loot box” depending on circumstances.

Also note that where a “loot box” would require the remission of cash from South Africa, that will most probably contravene the provisions of the Currency and Exchanges Act, 1933.

Contacts: Andre Visser and Megan Sturgeon

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No. Nevertheless, Spanish Gambling Authority has highlighted in several occasions that loot boxes could be considered as a gambling activity in the event that chance becomes the most relevant factor of its functionality.

Have loot boxes been challenged under consumer protection legislation?

Yes. Spanish Consumers Organization has repeatedly requested Spanish Gambling Authority to speed up the regulation of loot boxes and to take into account its requests for consumer protection, especially for minors.

Brief overview of the situation for loot boxes in your jurisdiction

In Spain, loot boxes are not yet regulated and there is not any caselaw related to them yet. However, Spanish Act 23/2022 amended Spanish Gambling Act 13/2011. This amendment urges the government to draw up certain guidelines to guarantee the safest use of loot boxes. These guidelines should include at least (i) The regime for commercial communications for these products (ii) The necessary consumer information regarding the risks of their use and abuse (iii) The necessary security measures for proper storage. These guidelines have not been issued yet.

Contacts: Paula Gonzalez de Castejón Llano-Ponte and Maria Burgos Torrado

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

No, not loot boxes specifically but other in-game purchases.

Brief overview of the situation for loot boxes in your jurisdiction

No regulation in Sweden explicitly prohibits loot boxes but the Swedish Gambling Authority refers to it as "a lottery-like element in computer games" and states that games with loot boxes are considered gambling, provided that the content of the loot box has an economic value in "the real world," rather than just in-game (i.e. may be sold or purchased outside the game). This statement is supported in 2022 preparatory works to changes in the Swedish Gambling Legislation that also found that no additional legislation was deemed necessary.

Contacts: Mathias Berggren, Josefine Mannerfelt, Linnéa Simon, Anna Jussil Broms and Peter Ihrfelt

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

No

Have loot boxes been challenged under consumer protection legislation?

Not specifically but UK consumer and ad regulators are active in respect of in-game purchases generally.

Brief overview of the situation for loot boxes in your jurisdiction

The stance of the Gambling Commission (GB gambling regulator) is that if in-game items obtained via loot boxes are confined to use within the game and cannot be “cashed out” this is unlikely to be a licensable gambling activity under relevant law set out in the Gambling Act 2005 (GA). However, the Commission has also stated that, regardless of statutory gambling definitions, it will still seek to protect children if the line between video games and gambling is ‘blurred’.

In response to parliamentary committees seeking specific reform of the statutory position above, the UK Government decided in 2022 after industry consultation not to extend the GA to cover loot boxes. Key factors behind that decision were: (a) that despite similarities with gambling, loot box prizes do not usually have a real world monetary value outside of the game; and (b) the challenges of practical implementation, including in respect of gambling tax.

The UK Government did reference the safeguards in consumer and data protection law and said that:

• purchases of loot boxes should be unavailable to all children and young people unless and until they are enabled by a parent or guardian;
• all players, including children, young people, and adults, should have access to, and be aware of, spending controls and transparent information to support safe and responsible gaming; and
• better data and research should be developed to inform future policy making on loot boxes and video games more broadly.

The UK Government stated that it would keep the position under review and a long-promised white paper outlining wider reform of the GA and gambling regulation is still expected in 2023.

Contacts: Duncan Calow, Atacan Aydinli, Sam Gokarn-Millington and Ally Clark

Are there dedicated regulations on loot boxes in your jurisdiction?

No

Have loot boxes been qualified as gambling by any court/authority of your country so far?

Yes (see Kater v. Churchill Downs, Inc. case discussed in response to Question 4)

Have loot boxes been challenged under consumer protection legislation?

Yes (see Coffee v. Google LLC case discussed in response to Question 4)

Brief overview of the situation for loot boxes in your jurisdiction

A U.S. federal court recently dismissed a class action lawsuit against Google over alleged “predatory practices” surrounding loot boxes in the Google Play Store. Parents of minors had claimed that loot boxes constitute illegal “slot machines or devices” under California law. The case reignited debate over whether buying loot boxes constitutes gambling. And even though the court dismissed the parents’ lawsuit, the legal status of loot boxes remains unclear under US law.
 
The parents who filed the lawsuit against Google claimed that the loot boxes enticed “consumers, including children, to engage in gambling and similar addictive conduct” and that the loot boxes have the “hallmarks of a Las Vegas-style slot machine, including the psychological aspects to encourage and create addiction.”
 
The court evaluated Google’s liability under the terms of Section 230 of the federal Communications Decency Act, which exempts platform companies from liability for content shared on their platforms. Although the court dismissed the lawsuit, it did so because Google merely allowed video game developers to provide apps to users through its app store. In other words, the court ruled against the parents not because it determined that loot boxes were not games of chance. Rather, it simply upheld the legal principle that a platform company “providing third parties with neutral tools to create web content is considered to be squarely within the protections of Section 230.” See Coffee v. Google LLC, No. 5:20-cv-03901-BLF (N.D. Cal.).
 
However, in Kater v. Churchill Downs, Inc. 886 F.3d 784 (ninth Cir. 2018), the ninth Circuit held that Churchill Downs violated Washington state’s Recovery of Money Lost at Gambling Act by selling virtual chips in its Big Fish Casino app and that users could potentially recover the value of lost “chips” in the app. In that case, the Big Fish Casino app was a slot-machine-style game and the chips could seemingly be used only to play more slots. By contrast, most video games with loot boxes include purchases as a small part of a larger game of skill and/or allow users to make non-randomized purchases with in-game virtual currency. 
 
Although there have been efforts in the United States to regulate loot boxes through state and federal legislation - and a Federal Trade Commission workshop in 2019 raised the issue of loot box regulation - currently no legal consensus exists in the United States around the illegality of loot boxes. As such, no statutes or regulations at the federal level ban loot boxes. This is very much an evolving area of law throughout the U.S. at both the state and federal levels. 

Contacts: Mike Peacock and Tom Ara