Industry Reports

Hawaii Poised to Regulate Video Game Loot Boxes

Since the release of the new Star Wars Battlefront II action shooter video game Star Wars Battlefront 2, gambling regulators are busy with examining the so-called loot boxes and determine if they constitute gambling or not. Many countries have already condemned these loot boxes mostly seen in video games as “predatory practices” that can get children hooked on gambling. As the heated debate over loot boxes keeps on progressing as fast as lightning, some jurisdictions have already taken steps to combat the “predatory practices”.

The issue of loot box gambling reached also the United States. Last December, Hawaiian state representative Chris Lee said games using loot boxes are very similar to casinos. The politician asked the gaming regulator to label loot boxes as gambling and regulate video games that feature loot boxes. In a press conference last year, the Democratic State Representative from Hawaii presented a plan to protect minors from the hidden threat that games like Star Wars: Battlefront II pose.

Over the past several months, the Hawaiian lawmakers have introduced four bills that aim at regulating the sale of games that feature pay-to-win loot boxes. Two of the bills (House Bill 2686 and Senate Bill 3024) are to ban the sale of video games with loot boxes to people under the legal gambling age of 21. The other two bills (House Bill 2727 and Senate Bill 3025) suggests that the developers should clearly designate games that contain loot boxes and label them as games featuring “in-game purchases and gambling-like mechanisms which may be harmful or addictive”.

In an interview with Hawaii Tribune, state representative Chris Lee explained that he is aware of the fact that psychologists were employed by video gaming companies to develop these mechanisms. He explained that he was also used to play video games and he is familiar with the development of the gaming industry, which “has begun to exploit people, especially children, to maximize profit”.

The World is Getting Smaller for Games with Loot Boxes

Many governments across the world are calling for a ban on loot boxes, describing Battlefront II as a “Star Wars-themed online casino”. First, Belgium officially declared loot boxes as a form of gambling. Earlier this month, Germany has joined the pack of countries, calling for the regulation of video game loot boxes.

The Victorian Commission for Gambling and Liquor Regulation (VCGLR) in Australia also declared that pay-to-win loot boxes in video games constitute gambling. Last week, the Swedish Minister for Public Administration Ardalan Shekarab alluded that the country may also take a similar stance on the matter and classify loot boxes as a form of gambling.