Australian legislation addresses loot boxes in video games

The Classification (Publications, Films and Computer Games) Amendment (Loot Boxes) Bill 2022 (Bill)  has been tabled in the House of Representatives on the 28 November 2022.  The private member’s Bill acts in response to growing support for the regulation of features and elements within video games which appear to simulate gambling.

What is a “loot box”

This comes in the form of ‘loot boxes’ (Loot Boxes) which are consumable virtual items or prizes that can be purchased to enhance a gaming experience.  These items require real currency to be paid.  The Bills introduction would call for a mandatory adult classification and warnings printed on the packaging of any game that contains Loot Boxes.

Main objectives of the Bill

The main objective of the Bill is to address the regulatory process in which video, computer and online games containing Loot Boxes are classified.  This calls for an additional classification requirement for the Classification Board to consider when issuing classification guidelines.  The explanatory memorandum of the Bill proposes amendments to the Classification (Publications, Films and Computer Games) Act 1995 (Classification Enforcement Act):

• an additional section will be inserted after section 9A. This section would provide for classification and consumer warnings for video games containing Loot Boxes;
• subsection 9B(1) would require the Board to classify computer games as either R 18+ or RC if it contains Loot Boxes; and
• subsection 9B(2) would mandate that the packaging of video games must express clearly for parents and guardians that the game contains Loot Boxes. This would be incorporated into pre-existing classification requirements to be disclosed on game packaging.

Current regulation of Loot Boxes

Currently, the use of Loot Boxes is predominantly unregulated in Australia according to the Guidelines for the Classification of Computer Games 2012 (Classification Guidelines):

• the Classification Guidelines and Classification Enforcement Act does not require Loot Boxes be considered in the classification of video games; and
• concerns that Loot Boxes stimulate gambling has come to rise, however, it does not fall within the Interactive Gambling Act 2001 (Cth) definition of a “gambling services”.

What does this mean for game developers?

The proposed Bill threatens the ability of game developers and businesses to monetise a game to its full extent as the addition of Loot Boxes allows for the generation of further revenue.  Another concern for game developers is raised in the Human Right implications of the Bill as a minimum age classification eliminates the large consumer base that is young adults and adolescents.  This section of the Bill details that it is a restriction on freedom of expression as the classification will restrict access to certain content.  However, details that it is perceived to be reasonably proportionate.

Links and further references

Legislation

Classification (Publications, Films and Computer Games) Amendment (Loot Boxes) Bill 2022

Classification (Publications, films and Computer Games) Enforcement Act 1995 No 63

Guidelines for the Classification of Computer Games 2012

Interactive Gambling Act 2001 (Cth)

Further information about game development

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Disclaimer

This article contains general commentary only.  You should not rely on the commentary as legal advice.  Specific legal advice should be obtained to ascertain how the law applies to your particular circumstances.

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