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Business • Jul 26, 2019

UK gambling watchdog says loot boxes are not considered gambling

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UK gambling watchdog says loot boxes are not considered gambling

With much debate over loot boxes in recent months and whether they are considered gambling, the UK gambling watchdog’s recent ruling is sure to throw things for a loop. 

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According to a report by the BBC, MPs were told by the gambling watchdog that it does not consider loot boxes or FIFA packs to be gambling because it has no way to monetize what is inside of them. 

Loot boxes are similar to a package of trading cards because the buyer has no idea about its contents (aside from what it could potentially contain) until it is opened. The items could range from skins for a character, weapons, upgrades, or skills. 

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Currently, there is no official monetary value for the items inside of a loot box. However, there are third-party sites where users can buy and sell in-game content.

“There is unquestionably a demand for a secondary market,” Gambling Commission program director Brad Enright said. In particular, he said that EA, the publisher of FIFA, faces “a constant battle” against third party marketplaces. 

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Games like FIFA contain "player packs" that could be considered gambling

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Gambling Commission chief executive Neil McCarthur said that while there were concerns over children playing video games in which there was an element of chance, under the current legislation they were not considered gambling.

“There are other examples of things that look and feel like gambling that legislation tells you are not...” he said while speaking at the Department for Culture, Media and Sport select committee. “...but because they have free play or free entry they are not gambling.”

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This is in stark contrast to Belgium’s 2018 ruling in which the Belgian Gaming Commission declared that loot boxes are considered gambling. As a result, Blizzard removed loot boxes from its titles Overwatch and Heroes of the Storm. 

Meanwhile, in the United States, the Federal Trade Commission will be holding a workshop on August 7, 2019, to examine loot boxes and consumer protection issues associated with them.

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Additionally, Valve is being sued by the Quinault Nation, an indigenous American tribe, for "encouraging illegal gambling" through loot boxes.

"The creation of skins was a deliberate attempt by Valve to increase its sales and profits by adding an element of gambling and market economies to its product," the suit claims. "Valve is well aware of the skins gambling that goes on, is well aware that skins have real world cash value, which has increased their popularity and value, and actively encourages and facilitates skins gambling."

What do you think about loot boxes? Do you think they’re gambling? Let us know on Twitter. 

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