Department For Culture Media Sport
Summary
1. Since the publication of the government response to the call for evidence on loot boxes in video games in July 2022, the Department for Culture, Media and Sport (DCMS) has convened a Technical Working Group of games industry representatives, tasked with improving protections for children and adults with regards to loot boxes.
2. As the output of this work, following engagement with players, parents, government departments, independent bodies, regulators, academics and external organisations, the games industry trade body UK Interactive Entertainment (Ukie) has developed and published UK games industry guidance on loot boxes. The government welcomes this guidance which, if fully implemented, has the potential to enhance player protections in line with the objectives set out in the government response. We are now calling on the games industry to work closely with players, parents, academics, consumer groups and government bodies to adopt and implement the guidance in full, and continue to improve protections for players.
3. To meet the objective of improving the evidence base on loot boxes and video games more broadly, DCMS has collaborated with academics, industry, other government departments and Research Councils to develop a Video Games Research Framework which was published in May 2023. The government welcomes independent academic scrutiny, facilitated by the Research Framework, to assess:
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the effectiveness of the implementation of industry-led protections
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how widely these protections are being adopted across the sector; and
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more broadly, how best to ensure player safety with regards to loot boxes
Government response on loot boxes in video games
4. Loot boxes are features in some video games that are part of a wider market for in-game purchases. They contain apparently randomised items in which the player does not know what they are going to get until they have opened the loot box. They may be purchased with money (including via virtual currencies) or accessed via gameplay. Public concern on loot boxes has drawn comparisons with gambling products, and the risk of harm for children and adults.
5. The government undertook an extensive call for evidence on loot boxes, and published its response in July 2022. This found an association between loot box purchases and problem gambling, but evidence has not established whether a causal relationship exists. In response the government set out its view that:
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purchases of loot boxes should be unavailable to all children and young people unless and until they are enabled by a parent or guardian
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all players should have access to, and be aware of, spending controls and transparent information to support safe and responsible gameplay
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better evidence and research, enabled by improved access to data, should be developed to inform future policy making on loot boxes and video games more broadly
6. Since then, the government has facilitated engagement between the games industry and players, parents, government departments, independent bodies, regulators, academics and other external organisations to pursue these objectives. The output of this work is:
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new industry-led guidance on loot boxes which has been published by the industry trade body Ukie
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a Video Games Research Framework which has been published by DCMS
Industry guidance on loot boxes
7. To address the issues set out in the government response on loot boxes, DCMS convened a Technical Working Group with representatives of games companies and platforms, tasked with improving protections for children and adults. Its output is industry-led guidance on paid loot boxes, coordinated by the trade body Ukie which was published on 18 July 2023.
8. The Technical Working Group met eight times between September 2022 and June 2023, including a meeting chaired by the DCMS Secretary of State in June 2023. Academics, the Games Ratings Authority (GRA) (formerly known as the Video Standards Council), the Information Commissioners Office (ICO) and the Competition and Markets Authority (CMA) participated in the Technical Working Group. To support this work, DCMS and the GRA convened a Players and Parents Panel which met three times between December 2022 and March 2023 to facilitate feedback on the industry-led proposals with regards to loot boxes. In addition, DCMS facilitated engagement with academics and consumer groups to provide feedback to Ukie on its draft guidance.
9. We are grateful for the range of companies, platforms and trade bodies who participated in the Technical Working Group (see Annex A), but note that its reach does not cover the entire games sector operating in the UK. We also note that when referring to the games industry there are different views and approaches with regards to loot boxes. This includes many companies operating in the UK who do not deploy loot boxes in their games, and platforms and games that already adopt many of the measures set out in the new industry guidance.
10. The government is providing its view of the new industry guidance on loot boxes, in light of the conclusions and next steps set out in the government response (paragraph 5), and the engagement set out above (paragraph 8) which has included feedback to Ukie on the draft guidance.
11. We appreciate the complexity, dynamism and fast changing nature of the games sector which is one of the reasons why we have pursued an industry-led approach to improve protections for players. However, we are also of the view that this plurality should not result in a lowest common denominator approach that does not lead to meaningful improvements across the sector.
Preventing children from purchasing loot boxes without parental consent
12. We welcome the clear commitment in the new industry guidance to use technological controls to restrict anyone under the age of 18 from acquiring a paid loot box without the consent or knowledge of a parent or guardian. As part of implementing its guidance, we call on industry to increase and monitor the uptake of parental controls, and to ensure widespread adoption of current best practice of default 0 spending limits on child accounts (applying both to loot boxes and other in-game purchases).
13. Effective parental controls need to be underpinned by improved age assurance, which reduces the reliance on self-declaration. We welcome the commitment to improve age assurance, and our view is that games companies and platforms have the opportunity to be at the forefront of adopting and implementing age assurance technologies. This includes voluntarily adopting technologies that will be driven by the implementation of the Online Safety Bill. As part of implementing the new industry guidance, we want to see how the outputs of a new industry panel on age assurance translate into improved industry practice.
14. We recognise that, even with these improvements, parental controls and age assurance technologies may not always prevent children from purchasing loot boxes without prior parental consent. Refunds are therefore an important backstop to further mitigate the risk of financial harms which may be associated with loot boxes. We welcome the commitment to fair and lenient refund policies, and importantly, that these policies are communicated to players and parents. As part of implementing the industry guidance, we want parents and guardians to be reassured that where parental controls and age assurance technologies do not prevent children from purchasing loot boxes without parental / guardian consent, lenient refunds are available and will be applied.
Spending controls and transparent information for all players
15. Consumer law requires that businesses do not act unfairly when dealing with consumers. A key concept across several pieces of consumer law is that individuals can make informed choices about their purchases, which requires that traders are meaningfully transparent about what they are offering. These requirements apply both to the purchase and / or use of games but also to economic decisions taken in-game, for example the purchase and use of in-game currency which can be purchased with real-world money.
16. In light of requirements of consumer law, and informed by engagement with the CMA, the government welcomes industry commitments to design and present paid loot boxes in a manner that is easily understandable to players, and which promotes fair and responsible play and give clear probability disclosures. As part of implementing the guidance, the government