Loot box law seeks to ban video game gambling risks from children, add warning labels for parents

A new proposal to restrict an “insidious” part of video games could change how Australian kids are becoming addicted gamers. Have your say and vote in our poll.

Exclusive: Video game “loot boxes” will be banned from use by Australian children under a new proposal to take action against the controversial additions that have already been outlawed in several countries.

Independent MP Andrew Wilkie will launch the bid to restrict what he called “barely disguised gambling” in games such as Roblox and Clash Royale in a private members’ bill in August.

It will also seek to introduce warning labels on any games featuring loot boxes.

The proposal will follow News Corp’s Screen Time campaign that revealed multiple recommendations to investigate and prevent Australian children accessing the gambling-style purchases had been ignored or dismissed over the past three years.

Loot boxes, sometimes called player packs, crates or lockboxes, are mystery collections of virtual items that can be purchased in games for cash or virtual currency.

Players bet that they will unlock valuable virtual items from a loot box, like a rare outfit or skill, and some items can be traded or sold for real cash.

Roblox is a multiplayer online game and video game. Picture: Getty

But a recent review of 13 studies by researchers at the Universities of Plymouth and Wolverhampton found 12 proved “unambiguous” links between loot boxes and problem gambling, while a new study from Massey University in New Zealand showed problem gamblers spent more money on loot boxes than their peers.

A 2018 Senate inquiry found a “comprehensive review” of loot boxes was needed in Australia, while a February 2020 inquiry recommended an investigation led by the eSafety Commission. Both recommendations were “noted”.

But Mr Wilkie said the risks to young players was clear and his private members’ bill would seek to have video games with loot boxes banned from use by children with an R18+ rating and would require “a warning to be displayed … so parents will be able to clearly tell when they are included in gameplay”.

Independent Member for Clark, Andrew Wilkie. Picture: Zak Simmonds

“Young people who are spending a lot of money on these loot boxes are being groomed for future gambling,” Mr Wilkie said.

“It’s not clear if that’s what game companies design but it’s self-evident that they have that effect.

“To allow very young children to pay cash for a randomised event that may or may not reward them that would meet any definition of gambling.”

Mr Wilkie said the proposed law would not ban loot boxes in Australia entirely, as countries including Japan, the Netherlands and Belgium had done, but would prevent them from being used by children through the classification system.

“We as a country accept that people over the age of 18 can gamble but let’s make that for adults and giving parents a warning,” he said.

“I think most parents would be horrified and I have no doubt the vast majority would oppose loot boxes if they knew about them. It’s a really insidious thing.”

Sydney mother Faye James, whose son Pablo, 8, spends pocket money in Roblox, said she supported Mr Wilkie’s proposal, both as a way to restrict access to gambling for children and as a way to warn parents of the risks.

Pablo James pictured at his home where has been caught out playing "Roblox" on his iPad in the middle of night by his mother. Picture: Sam Ruttyn

“This kind of bill is fundamental,” she said. “We need help to make parents aware of what they’re getting their kids into. Restrictions and transparency are key.“

GamBlock chief executive David Warr said the lack of current restrictions for loot boxes in video games had forced some parents to look for other, more extreme solutions.

Mr Warr said a concerned Wollongong parent approached the company to block all games on Steam, which he introduced as a feature after talks with gambling counsellors.

“We found it was within the sphere of gambling so we blocked it for this one person but now it’s become a feature others use,” Mr Warr said.

“In my opinion, it’s a hop, skip and a jump from playing a loot box to playing another gambling game.”

Mr Wilkie said he expected to introduce the Classification Amendment (Loot Boxes) Bill in mid-August, and hoped it would find support from Government and Opposition MPs.