Electronic Arts Win the Appeal against the KSA over Loot Boxes

The State Council of the Netherlands, Raad Van State, has sided with EA Games in the company’s dispute with the Dutch KSA. The Dutch gambling regulator judged that EA’s loot boxes can be labeled as games of chance reward.

KSA Won the Original Ruling

KSA notified EA Games in 2018 that it will undertake an investigation into the loot boxes. The investigation ended in 2019 and it resulted in the KSA giving EA a €5 million ($5.5 million) fine. Moreover, it ordered EA to withdraw all loot boxes from the Dutch market.

EA appealed to this decision and matters were taken in the Hague Commercial Court, which sided with the KSA. The Hague Commercial Court agreed that the loot boxes could be considered games of chance reward. As an explanation, the court stated that these loot boxes have a “monetary value” and hence, the actions mirrored a gambling reward.

To make things even more troubling for EA, the judgment from the Hague Court resulted in the KSA doubling the fine to €10 million ($11 million).

This decision did not sit well with EA, who decided to appeal the decision again, but this time, the company went to the highest judiciary court in the Netherlands – the Netherlands State Council.

The State Council Outlined Some Matters That the Hague Court Missed

Netherlands’ State Council reviewed EA’s appeal and determined that the publisher made a clear outline of how these loot boxes are awarded. Players must compete in FUT Mode (FIFA Ultimate Team Mode) to collect FUT coins and thus, activate prizes.

The verdict by the State Council said that the KSA shouldn’t have imposed the initial $5.5 million fine to EA on its FIFA game release. The verdict also noted that the loot boxes are traded virtually and they do not require a license as they aren’t games of chance.

With that being said, the highest court in the Netherlands ruled in favor of EA and stated that the publisher did not break the law. Courts in the European Union are likely to double-check the decision of the state council due to the fact that the Internal Market Research Committee has stated that member states of the EU are not too consistent in governing disputes concerning loot boxes.

A representative for EA spoke to Eurogamer and said that the State Council’s ruling confirms that FIFA does not represent gambling under any aspect of Dutch law. The representative also added that EA always puts fun, fairness, choice, and value first and its products are designed to provide Dutch players and players from all around the world with a positive experience.

The whole controversy over loot boxes began in 2017 when they were introduced in Star Wars: Battlefront 2 and Middle-earth: Shadow of War. As a popular game, FIFA was the center of that controversy. In 2021, EA even adopted preview packs in which players were able to see the content before they purchased it. According to the publisher, this system boosted sales.