Project Audit on Signs of Gambling | Law&Trust International

Attempts to increase the profitability of the created game or related product often leads to unexpected consequences. One of these consequences is the recognition of the released computer game gambling.

Each country carefully monitors compliance with legislation on gambling and does not allow its illegal conduct, including online. All computer and mobile games with gambling elements are in the risk zone. The most prominent example of a gambling element in the game is luthboxes or in-game boxes.

According to the decision of the Belgian Gambling Commission, according to the results of inspections against some publishers and their games, such as Valve, EA and Blizzard, the system of in-game boxes with the loot was found to meet the criteria for gambling. According to Belgian legislation, gambling includes games in which there are a winner and a loser, and the victory is achieved not by playing skills, but due to elements of randomness. Also, such winnings must be valuable and exchangeable. Under this definition also fit the game, allowing you to buy in-game resources for real money.

Each of the companies that did not pass the test received an order to eliminate the elements of illegal gambling. In case of failure to comply with the requirements of the Belgian law, they face criminal responsibility in the form of imprisonment for up to 5 years and a fine of 800,000 euros. As a result, these publishers have lost profits from in-game purchases from gamers from Belgium and some countries that have applied similar sanctions.

Following the example of Belgium, regulators of most European countries followed. At the moment, the issue of establishing a single standard for identifying signs of gambling, banning or limiting elements of gaming in video games is actively worked out. For example, the Netherlands defines Luthboxes as illegal online casinos and prohibits such activities in the country.

Preventing the onset of undesirable consequences and determining the risks of recognizing a product as a gamble, it is necessary to carefully work out the internal mechanisms of interaction of players with items received or purchased.

The concept of gambling is independently defined in the legislation of each jurisdiction, setting the criteria for gambling. When developing in-game mechanisms, it is necessary to take into account the law of each country in which this game is going implemented. First of all, it is essential to pay attention to the key features of gambling: elements of randomness; the presence of a winner and loser; the possibility of sale and profit.

Law and Trust specialists carry out a detailed analysis of the existing product to identify signs of gambling. After in-depth analysis, leading lawyers with extensive experience in the gaming field are working on an individual solution to reduce the risk of gambling recognition for each gaming product.

Audit of the project to identify signs of gambling

To determine the risks of gambling recognition, first of all, it is necessary to conduct an in-depth review of the product. According to the results of the analysis, the specialists of our team reveal all the signs of gambling present in the analyzed product. Each sign has its own individual set of risks determined by the results of the audit.

Restriction of jurisdictions

  • Law and Trust specialists carefully select jurisdictions applying a complete ban on online gambling and seeing gambling elements in computer and mobile games. If the Client is not ready to abandon internal microtransactions and luthboxes, we will offer the most loyal jurisdiction, excluding the countries that negatively attributed to the Client's activities. In this case, you do not need to restrict the relevant market, such as Belgium completely. It will be sufficient to eliminate the possibility of using prohibited operations to users in this jurisdiction. However, you will have to track transaction attempts to bypass the existing ban carefully. It should also note that the number of authorities that consider boxes of items as elements of gambling increases with each passing year.

Exclusion of gambling elements

  • The most effective way to reduce the risk of accountability in connection with the presence of signs of gambling is to correct the elimination of these signs legally. The Law and Trust team identifies the functional features of your product that have the risk of being recognized as an element of gambling. Each item is individually minimizing or eliminating. Particular attention should pay to the possibility of selling won items, the equivalence of the falling prize and the chance of winning.

Obtaining a license for gambling

  • If the Client decides on the need to preserve the identified elements of a gamble that fall within the definition of online gambling, we recommend that you issue legal permission to engage in gambling activities. First of all, it concerns games in which the loot box is not an additional element but the main functionality. Also, obtaining a license will be required for online platforms that allow you to get game items of third-party services or games by drawing, randomly purchasing or another similar method.

     

  • Law and Trust lawyers have been providing gambling license services (online and offline gambling) since 2003 in more than 13 jurisdictions.

Compliance with the requirements of the interesting jurisdiction

Making full preparation of the company to comply with the laws of various jurisdictions before the release of the product, our specialists take into account the peculiarities of the requirements of each country.
So, for example, if you are planning to release a game in the Chinese market and want to implement an in-game Luthbox system, you must comply with the requirement of transparency, namely, prepare and uncover the method of prize loss, reveal the probability of a thing of a particular category of value before buying a box.

Legal opinion

To assess our customers' compliance with legislation in the field of gambling, protect their interests in the courts of the relevant jurisdiction, our company experts provide an independent legal opinion on the issue of compliance with the law and the legality of the Client's gaming activities.

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