The UK Gambling Commission issued a statement over the weekend regarding the ever-growing argument over loot boxes/crates and microtransactions, and whether or not they constitute gambling. The commission decided that they are not gambling since the money you put into them does not constitute a cash payout in return and that you’re technically buying something. This is the opposite of Belgium and Australia, who both made statements saying that these systems do constitute as gambling. You can read the full statement here, but we have a snippet of the statement below.
Our starting point in deciding our position with any product is to look closely at whether or not it falls under UK gambling law. The definition of what is legally classed as gambling is set by Parliament rather than by us. Our role is to apply that definition to activities that we see and any changes to that definition need to be made by Parliament.
The law sets a line between what is and is not gambling. As the regulator we patrol that line and where an activity crosses it and presents a risk to people, especially children, we have and will take robust action. Earlier this year we successfully brought the first criminal prosecution in this area in relation to Futgalaxy – a website for providing skins gambling to children (skins gambling is explained within the position paper).
A key factor in deciding if that line has been crossed is whether in-game items acquired ‘via a game of chance’ can be considered money or money’s worth. In practical terms this means that where in-game items obtained via loot boxes are confined for use within the game and cannot be cashed out it is unlikely to be caught as a licensable gambling activity. In those cases our legal powers would not allow us to step in.