Netherlands: loot boxes escape the law

The Netherlands has just delivered a damning report: despite clear guidelines on consumer protection in the face of video game monetisation practices, the majority of publishers continue to flout the regulations. A new university study reveals that 90% of popular iPhone games do not comply with legal obligations regarding loot boxes. And the most worrying thing? It’s often the biggest companies that break the rules with impunity.

Loot boxes: a system akin to gambling

Loot boxes are ‘mystery chests’ that players can buy for real money, in the hope of obtaining rare items. Although they are often presented as innocuous features, their mechanics are based on chance and are very reminiscent of traditional gambling.

According to a study by researcher Leon Y. Xiao, include them. And this includes titles that are accessible from the age of 4, according to the age classifications on app stores.

The legal framework: clear but ignored rules

Since 2020, the Dutch Consumer and Markets Authority (ACM) has imposed four major obligations on game developers:

1. Displaying the price in euros for each in-game purchase, including loot boxes.
2. Indicating the probability of obtaining each random item.
3. Mentioning the presence of loot boxes in the description of the game on application shops.
4. Not directly encouraging children to spend real money.

The results of the report are overwhelming:

• Display in euros: complied with by only 2% of games.
• Detailed probabilities: 35% of games give partial information, often in an incomplete or confusing way.
• Mention in the App Store: less than 5% of titles warn players of the presence of loot boxes.
• Incitement of minors: several games contain direct calls to action such as ‘buy now’, which are prohibited.

Loopholes in the application of the law

Why such non-compliance? The explanation can be summed up in two words: lack of enforcement. While the ACM has clearly defined the rules, few sanctions have been issued. On the other hand, when Apple automatically integrated certain obligations into its system (such as the ‘integrated purchases’ mention), compliance reached… 100 %.

This proves that with the right political will and technical mechanisms, compliance with the standards is possible. But the study highlights an uncomfortable truth: some multinationals are aware of the requirements but knowingly choose not to apply them.

A misleading ‘free’

Another point highlighted by the report is the abusive use of the word ‘free’ for games that massively encourage purchase. Of the 50 most profitable games in the Dutch App Store, all were presented as ‘free’, even though they were based on sometimes costly microtransactions.

In some cases, the interface and design are designed to hide the conversion between real and virtual currency, making it difficult for players to know how much they are actually spending.

Children targeted… and vulnerable

One of the most alarming aspects of this study is the vulnerability of children. A large proportion of the games analysed are deemed suitable for under-12s, even though they contain mechanisms inspired by games of chance.

Previous studies have shown a worrying correlation between the purchase of loot boxes and the subsequent development of problem gambling behaviour, particularly among teenagers.

The Netherlands: a mirror of European inaction?

The Dutch case is indicative of a wider malaise within the European Union. Although European directives on unfair commercial practices (UCPD) exist, their application remains largely theoretical without coercive measures.

The European Commission itself reiterated in 2021 that loot boxes must be treated as random paid content, with transparency requirements. But until national regulators take action, consumers remain vulnerable.

Loot boxes in Belgium 

In April 2018, Belgium’s Gaming Commission (GC) concluded after analysis that loot boxes (including major titles such as FIFA 18, Overwatch and Counter-Strike: Global Offensive) constituted gambling. They met the legal criteria: financial stake, chance, possibility of winning or losing, which contravenes Belgian gambling law. They are therefore now banned.

The legal consequences are serious: publishers breaching this ban face prison sentences of up to five years, as well as fines of up to €800,000, or even double that if minors are involved.

Despite this, some publishers have opted for technical workarounds (such as intermediate currencies), enabling Belgian players to buy loot boxes indirectly. Several reports, including one by researcher Leon Y. Xiao in 2022, show that over 80% of popular mobile games in Belgium still offer loot boxes, despite the ban. The GC itself admits that it lacks the human and technical resources to monitor all titles effectively.

An industry under pressure

Faced with increasing pressure from the media, researchers and consumer protection NGOs, the video game giants will have to adapt. Some initiatives, such as those in the UK via the Advertising Standards Authority, are a step in the right direction. But according to Leon Y. Xiao, only a firm legal framework and substantial financial penalties will be able to reverse the trend.

The message of this research is clear: the rules exist, but without controls and penalties, they are ineffective. The Netherlands has a powerful legal arsenal, inherited from European law. It’s time to make use of it.