New study finds rampant non-compliance and no enforcement

Loot boxes and gacha are gambling-like products inside video games that players buy to obtain random rewards. Concerns have been raised about consumers, particularly children, experiencing financial harm and developing gambling problems. The previous Conservative UK government asked the industry, represented by Ukie, to try self-regulating, rather than to impose legislation.

Following the highest standard of transparency and open science, registered report research published in Royal Society Open Science now reveals that these self‐regulations are very poorly complied with and are not enforced at all.

Noncompliance is widespread. Contrary to promises made to the UK public, none of the 100 highest‐grossing iPhone games sought explicit parental consent before enabling loot box purchasing by under‐18s. Only 23.5% disclosed the presence of loot boxes in their marketing. Only 8.6% of the games consistently disclosed the probabilities of obtaining different rewards.

Noncompliant games were reported to Ukie and the UK government more than half a year ago, but no enforcement action has been taken. All noncompliant games remain noncompliant but continue to be available for download, even though Ukie promised in July 2023 that noncompliant games would face “severe fines” and “delisting” from app stores. The rules are therefore also not enforced.

This state of widespread noncompliance and non‐enforcement fails to adequately protect consumers, particularly children, as originally promised. These companies are not just breaching industry self‐regulation, but also advertising regulation and consumer law. Other regulators, such as the Advertising Standards Authority, Trading Standards, and the Competition and Markets Authority, should more proactively enforce the law.

Stricter regulation of loot boxes must be adopted as the industry self‐regulation experiment has failed again.

For the avoidance of doubt, this study has been conducted independently of another study being conducted by Public Group International Ltd (t/a PUBLIC) on commission from the UK Department for Culture, Media and Sport (DCMS), for which the first author serves as an expert consultant. The results should be read in conjunction.