UK House of Lords Urges for Reclassification of Loot Boxes

House of Lords Gambling Committee in the UK released a report pointing out that loot boxes need to be urgently reclassified as gambling products. The committee outlined potential danger pertaining to gambling-related harm and asked for simultaneous changes.

Report: House of Lords Urges for Regulation of Loot Boxes as Gambling Products

The House of Lords Gambling Committee published a report today where it warns about gambling-related harm from loot boxes. According to the Committee, the Gambling Act of 2005 needs changes to reclassify the loot boxes as “games of chance.” This is because the current conditions and access to technologies by children creates a “perfect storm of addictive 24/7 gambling.” With that being said, the Committee urges the government and the country’s regulator to make changes now. According to the Committee, some changes can be introduced as soon as possible, considering that no legislation is needed.

Further to the report, Committee Chair, Lord Grade of Yarmouth commented on the subject by saying that most of the people who gamble do it safely. However, Lord Grade noted that gambling-related harm has impacted some two million people’s lives, making the miserable. He pointed out that this harm can sometimes results even in suicide. Lord Grade continued by saying:

The behaviour of some gambling operators, where vulnerable people were targeted with inducements to continue gambling when the operators knew they could not afford to, shocked the Committee.“

The Committee chair continued by outlining that urgent actions need to be taken by the UK government. It’s important to mention that the Committee released a set of 66 key recommendations on how to handle the loot box problem in the UK. The recommendations set by the Committee have the goal of reducing gambling-related harm.

Loot Boxes – Why So Controversial?

Almost all loot boxes regardless if available for games on a mobile device or a computer platform share the same technology. The loot box is usually received for free and can be opened with the help of a key or a token. Players have to buy the key or token in order to receive the loot. Such loot can consist of various game contents such as weapon skins, icons, gun modifications cosmetics, or other items. The controversial part of loot boxes is the method of obtaining the loot. Similar to random number generators (RNG), the loot is awarded to the player “in a game of chance” once the loot box is opened. The loot boxes in the UK are not regulated under the pretext that the items do not hold any real money value.

However, this creates an arguable point, as players use real money to buy the token or key to open the loot box. With that being said, many platforms also feature selling or buying of items, received from loot boxes. In other words, keeping in mind the mechanic of the loot boxes and the transactions which can be conducted with such items, children might as well feel experience similar to gambling.

Back in June, the UK’s Department for Digital, Culture, Media, and Sport announced the launch of research for analysis of loot boxes in video games. Keeping in mind the most recent report by the Committee, the fate of loot boxes in the UK is yet to be decided. Elsewhere in Europe, countries have already taken measures against loot boxes. Looking back to 2018, Belgium lawmakers deemed the loot boxes illegal in the country.