Loot Boxes: Opening a(n other?) Pandora’s Box around Games

On 9 November 2017 the Gaming Authority announced that it will address the question of whether loot boxes constitute games of chance (Kansspelautoriteit: wees alert op online spellen met loot boxes), which has generated considerable interest in the mainstream media during the past few days. Opening such a treasure trove of issues reflects the Gaming Authority’s earlier signals that it is interested in social games, having previously noted that risks of addiction prevail and that social games can encourage younger players to move to real money gambling when, perhaps, they would not have done so otherwise.

The much awaited reform of the ageing Wet op de kansspelen 1964 has yet to take place. Following the lengthy process around the formation of the cabinet after March’s general elections, various stakeholders are coming out of hibernation as the process of introducing a licensing regime for remote gambling begins to thaw. Whilst the process has dragged on since the bill was introduced in 2014, questions around social games have arisen and thoughts are turning towards loot boxes too.

Various points of discussion are shifting to the fore. Do social games include games of chance, and thus get caught in the net of the 1964 Act? Or are social games something similar to, but falling outside the definition of, a game of chance? If the latter, what then? Can it be argued that the Gaming Authority is not empowered to take any action because such games fall outside of its remit? Or is this an overly formalistic approach when viewed from a consumer protection perspective, should the regulatory concerns around social games be sufficiently similar to those around games of chance? Do loot boxes also equate to games of chance and what regulatory measures might be deemed necessary within the (video) gaming environments?

Whether loot boxes constitute games of chance is one question, if and how social games should be addressed by gambling legislation is another. Similar questions have also vexed the Gaming Authority’s Belgian and British neighbours. On 17 November a Member of Parliament tabled questions around the use of loot boxes in video games, including the applicability of the 1964 Act.

Whilst the Netherlands once again moves towards the licensing of remote games of chance regulatory toes are already being dabbled in new(-er) frontiers.

For questions please contact gaming@kalffkatzfranssen.nl.