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Dutch authorities state: Loot boxes are prohibited in a number of games

Fall under the Lottery Act - now they talk to other European countries.

The Dutch Lottery Authority (De Kansspelautoriteit ) has just conducted a study to look at loot boxes and so-called skin gambling according to the country's laws.

In conclusion, a number of games that were investigated violate the law because they contain illegal elements that fall under the country's lottery laws.

Ten games were researched, and these were picked from the Twitch leaderboards - they are among the most popular in the world - but they are not specifically named in the survey

All the games had some opportunity to put real money into the game in order to buy loot boxes , and none of the games had any form of preventative action to stop problem gambling.

In addition to looking at the legality of loot boxes based on the gambling laws in the country, the authorities have also looked at whether people can become addicted to opening these.

 

Breaking the law

Four of the ten games violate Dutch law, reports the Authority.

This is because in these games you can transfer the content from the loot boxes to third party services (such as websites) where they can then be cashed into real money.

This is for example on so-called skin gambling websites, lottery sites, or similar marketplaces where cosmetic items can be sold for real money. Thus, the contents of the loot boxes get a direct monetary value.

- The games that contain the combination of in-game content that can be accessed through loot boxes and their transmission fall under Article 1 of the Money Gaming Act, the report states.

- Since a license to operate this cannot be granted under current legislation, these loot boxes are prohibited in the Netherlands.

At the same time, the Lottery Authority says that it is not a good argument that you cannot "lose" when it comes to loot boxes .

- Some parties use the fact that you always win something to support the argument that it's not a game of chance. This argument is not valid, it is written in the report.

 

This is a legitimate case from 2002, when an SMS service was charged with the same type of gambling. There you paid a small sum and could get a random result back - the main prizes could be an MP3 player or a scooter - but usually they only got a horoscope or a ringtone.

 

The service argued that they were not a lottery, since those who paid anyway received a premium, but the sentencing courts held that this did not hold, as there was varying degrees of value in the premiums.

This is further hampered in the report to the Lottery Authority:

- It is beyond doubt that the real winner is the person who wins the biggest and most valuable prize with a high market value.

The other six games that were investigated were found not to violate the Lottery Act, since you cannot transfer the content from the loot boxes to services that allow you to sell it for real money.

 

Not good for supposedly weaker audiences

But even though these do not have a monetary value , the conclusion when it comes to addictive effects is that loot boxes , seen as a whole, can have a negative effect.

- Integrating loot boxes into games that require skill, without taking the necessary precautions, may be contrary to Dutch gaming policy, which wants to limit the negative effects of gambling as much as possible.

The report says that they found no evidence that problem gamblers or addicts open loot boxes on a large scale, but that there is still a high risk that socially weaker groups, such as young children, may be encouraged to start gambling games as a result of loot boxes .

They consider the risk potential to be somewhere between "moderate and high" for vulnerable groups, and recommend more study of the effects here.

What is happening in the future now that it has been determined that games with loot boxes that have a market value are simply illegal in the country is uncertain.

On the other hand, it is pointed out that the Dutch Lottery Authority has had discussions with a number of other European countries on the topic, since the same loot boxes and game mechanics are used there as well.

Also read: " Skin gambling" and loot box turnover for a staggering NOK 232 billion this year.