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Australia Government Calls for ‘Comprehensive Review’ of Video Game Loot Boxes

After a months-long review of the use of loot boxes in video games and their potential impact on children, a Parliament committee is calling for the Australian government to undertake a “comprehensive review of loot boxes in video games.”

The recommendation came in the summary of a 90-page report released Tuesday by the Australian Senate Environment and Communications References Committee.

“This review should commission further research into the potential for gambling-related harms to be experienced as a result of interaction with loot boxes; identify any regulatory or policy gaps which may exist in Australia’s regulatory frameworks; examine the adequacy of the Classification Scheme as it relates to video games containing loot boxes; consider if existing consumer protection frameworks adequately address issues unique to loot boxes; and ensure that Australia’s approach to the issue is consistent with international counterparts,” according to the report. The review should be led by the Department of Communications and the arts in conjunction with the ACMA, the ACCC, the Office of the e-Safety Commissioner, the Classification Board, and the Department of Social Services.

Australia’s Interactive Games & Entertainment Association said it welcomes “the Committee’s measured and considered approach to this inquiry, which concludes with the sole recommendation of a future comprehensive review into loot boxes in video games.”

“The committee recommends that the Australian Government undertake a comprehensive review of loot boxes in video games. This review should be led by the Department of Communications and the Arts in conjunction with the ACMA, the ACCC, the Office of the e-Safety Commissioner, the Classification Board, and the Department of Social Services.

“This review should commission further research into the potential for gambling-related harms to be experienced as a result of  interaction with loot boxes; identify any regulatory or policy gaps which may exist in Australia’s regulatory frameworks; examine the adequacy of the Classification Scheme as it relates to video games containing loot boxes; consider if existing consumer protection frameworks adequately address issues unique to loot boxes; and ensure that Australia’s approach to the issue is consistent with international counterparts.”

The news comes the same week that the Federal Trade Commission said it would open an investigation into loot boxes in the United States. Federal Trade Commission chairman Joseph Simons said he would investigate video game loot boxes to ensure that children are being protected and parents are educated on the matter. Senator Maggie Hassan (D-NH), who brought up the issue of loot boxes in video games earlier this year, asked the FTC to launch the investigation and Simons confirmed he would.

The request comes about nine months after Hassan sent a letter to the Entertainment Software Ratings Board asking for the group to review the ratings process as it relates to loot boxes, examine the marketing of loot boxes to children, and put together best practices for developers around the toxic form of microtransactions. The senator also asked the board to conduct a study that further delves into the reach and impact of loot boxes in games. At the time, she said if they didn’t take sufficient action she would ask the FTC to get involved.

Hassan later told Variety that while she initially asked the ESRB to examine the issue, she thinks that the FTC have a responsibility to investigate it as well.

“The need for FTC action becomes more apparent given the recent report from the Gambling Commission of Great Britain and the steps other countries have taken to regulate loot boxes,” she said. “I hope the FTC will move quickly to begin their investigation and look forward to working with all parties on this issue.”

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