While video game loot boxes have recently been classified as a form of gambling by several European countries, Ireland has decided to take a different stance and will not be labeling the option as having a gambling component.

Backing down

Just after signing a declaration from the Gaming Regulators European Forum with 14 other governments describing loot boxes as an element that blurs the lines between gaming and gambling, Ireland has decided to shy away from labeling loot boxes as having a gambling component.

David Stanton, the Ireland Department of Justice Minister of State, told the Ireland Senate this week that the department does not have a role in regulating the developers of games as to how the games work or in the matter of offering in-game purchases.

While the declaration does not have a legal effect, it does show the concern of gambling authorities about the impact of online gaming. Stanton stated: “Where a game offers the possibility of placing a bet or the taking of risk for financial reward within the game, then, in my view it must be licensed as a gambling product.”

Stanton also said that it needs to be understood that if a game offers in-game purchase options, like loot boxes or skins, that are promoted to players as a way to increase their chance of success, the purchase options are considered a commercial or e-commerce activity and this would fall within consumer law.

The government of Ireland is currently working toward overhauling the country’s gambling law, set to create an independent regulatory authority for the gambling industry. This idea has been under consideration for quite some time, as gambling has been under review within an inter-departmental working group.

A review of proposals from 2013 was recently completed for the Gambling Control Bill. The group is getting ready to submit its findings report to the government this fall.

Loot Box Issue

In the video gaming world, loot boxes are virtual items that players can purchase or unlock during gameplay. Real money can be used to purchase the loot boxes, without the player knowing just what items are inside. Several European countries have decided to crack down on games that offer loot boxes, based on the belief that the games are facilitating gambling because players are selling the loot box contents for cash.

Koen Geens, the justice minister of Belgium, is a staunch opponent of loot boxes and has called for a ban of the option across the European Union. The request was made after the Belgian Gaming Commission investigated four games.

According to VSO News, the investigation found that three of the four games violated gambling laws in Belgium. Once the results of the investigation were revealed, Minister Geens said that offered the games could face criminal prosecution.

Geens requested that the loot boxes be removed and said that, if they were not removed, operators could face a maximum prison sentence of five years and fines as high as ￡700,000 ($975,000). Any fine could be doubled if minors were found to be involved.

As governments are weighing in as to whether or not they believe the loot boxes are gambling or not, Electronic Arts (EA), a top video gaming company, continues to refuse to comply with any law changes within countries who have ruled that loot boxes are gambling and illegal. Such countries have requested that loot boxes be removed and EA has continued to offer the content, arguing that their games are innocent and not considered a gambling activity.