A district court in the Netherlands has ruled against Electronic Arts in a case over loot boxes in the FIFA series of soccer games, permitting the Netherlands Gambling Authority to levy a fine of €10 million for violations of the country's Betting and Gaming Act.
The Kansspelautoriteit (more commonly known as Ksa) originally informed EA back in April 2018 that it considered loot boxes to fall under the Betting and Gaming Act as a gambling mechanism and gave them a period of eight weeks to bring their games into compliance. When EA declined to do so, the Ksa fined them €5 million (the maximum allowable fine under Dutch law) and subsidiary Electronic Arts Swiss Sarl an equal €5 million. The fines were levied last October, but EA went to court to dispute the fine as well as Ksa's intention to publicly announce the fines.
EA argued that the loot boxes do not violate the Betting and Gaming Act since the contents themselves cannot be converted in any way to actual money. They also argued that FIFA games are demonstrably games of skill rather than chance and that there has been no scientific evidence that the "Ultimate Team" packs in question contributed to gambling addiction. Further, they argued that Ksa's decision violated EA's freedom of expression and control over their property, and that disclosing the fine would disproportionately harm both its business and its reputation.
The Court was unmoved EA's arguments. Their ruling pointed out that while the main game itself may be a game of skill, there are means for people to profit from Ultimate Team cards (some valued at €2000) and "play" a game which is a game of chance using the loot boxes as a mechanism. The lack of scientific evidence related to Ultimate Game packs in particular did not outweigh the evidence collected about loot boxes in general, and the Betting and Gambling Act is based on the assumption that any game of chance carries with it the risk of gambling addiction. As for EA's complaint that the fine deprives EA of control over how their games are made, the Court noted that Ksa gave EA time to modify the game to bring it in line with the Act and EA declined to do so. EA still owns the rights to the FIFA franchise they have created, but it must comport itself with Dutch law. Regarding the censorship argument, the Court ruled that the interests of society to regulate games of chance outweigh an individual's freedom to express themselves by playing games of chance. And similarly, regarding the announcement of the fine, the public's interest in knowing about the fines and unlawful commercial practices outweighs EA's interest in preserving their reputation.
In a statement to Gamesindustry.biz, EA commented on the ruling. "Players all over the world have enjoyed FIFA and the FIFA Ultimate Team mode for many years and as such, we are disappointed by this decision and what it may mean for our Dutch community. We do not believe that our products and services violate gambling laws in any way. We are appealing this decision and we seek to avoid a situation impacting the ability of Dutch players to fully experience and enjoy FIFA Ultimate Team. Electronic Arts is deeply committed to positive play. We seek to bring choice, fairness, value and fun to all our players in all of our games. We remain open to discussions with the Netherlands Gambling Authority and other stakeholders to understand and explore solutions to address any concerns."
Food For Thought
EA still has the option to appeal, and they seem to be committed to exercising that option, but they are doubtlessly fighting an uphill battle. About the only possible strategy they could reasonably adopt would be that EA itself is not running a game of chance by producing the game any more than a company which makes playing cards is running an illegal poker game. It'd be a stretch, and even then, the other issues surrounding loot boxes may ultimately outweigh that point.