UK Committee Recommends Loot Boxes Be Regulated As Gambling

The other shoe hasn't quite dropped yet, but its laces are tickling the floor. The UK's Department for Digital, Culture, Media & Sport Committee has issued a report regarding loot boxes in video games, along with a variety of recommendations that, while not legally binding, could form the framework for future legislation and regulation.

In the report, the committee recommended that "loot boxes that contain the element of chance should not be sold to children playing games" and that PEGI -- the UK equivalent of the ESRB -- "apply the existing ‘gambling’ content labelling, and corresponding age limits, to games containing loot boxes that can be purchased for real-world money and do not reveal their contents before purchase." It further recommended that the government should apply the Gambling Act 2005 to loot boxes and that, should it choose not to do so, "produce a paper clearly stating the reasons why."

The report also agreed with the previous conclusion by the UK Gambling Commission that companies "should be doing more to prevent in-game items from being traded for real-world money, or being used in unlicensed gambling." It also wasn't a fan of game companies' obfuscation regarding its methods and data collecting, saying that their "lack of transparency is unacceptable." In general, the committee wasn't buying most of what the industry was selling -- figuratively, of course -- with regards to its various defenses regarding loot boxes.

What does all of this mean? Committees like this one are described -- by a commentor on this Eurogamer article who claims to have worked with Parliament -- as a bodies that "shadow and scrutinise the work of a Government department and sometimes make policy recommendations (as they have here)." That makes all of this a "recommendation by a third party, albeit an influential one."

So nothing is law, just yet. What we do appear to have, however, is action taken by elected officials who said they would "look into" (using one set of words or another) the issue of loot boxes and whether they qualify as gambling. It's a step, and a big step, in the direction that many have foreseen for some time now and whose final consequences are yet to come -- but they don't look good for loot boxes and the companies that rely on them.