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Hawaii proposes landmark legislation against loot boxes

UPDATE: State representative who previously declared legislation a "slippery slope" affirms support for efforts toward regulating loot boxes; expects more states to follow Hawaii's lead

Original story (13/02/18): Hawaii has become the first US state to officially propose legislation against loot boxes in video games.

Last month Kevin Ranker, a Democratic state senator in Washington, introduced a bill aimed at defining whether or not the mechanic in games constitutes gambling.

However, the proposed Hawaiian legislation goes a step further. The collection of four bills explicitly targets loot boxes, and proposes comprehensive legislation addressing multiple areas of concern.

"These predatory mechanisms... can present the same psychological, addictive, and financial risks as gambling," reads the bill text, which also cites the recent World Health Organisation move to consider 'gaming disorder' as a disease.

The bills have been spearheaded by Democratic state representative Chris Lee who previously described Star Wars Battlefront II as a "Star Wars-themed online casino".

"I grew up playing games my whole life," said Lee in a Hawaii Tribune Herald report. "I've watched firsthand the evolution of the industry from one that seeks to create new things to one that's begun to exploit people, especially children, to maximize profit."

According to Lee, who has worked alongside other states and countries in a bid to create a widespread response, more than half of US states are considering some form of loot box legislation.

"If enough of the market reacts, the industry would have to respond and change its practices," he said.

The first pair of bills, House Bill 2686 and Senate Bill 3024, aim to prohibit the sale of video games containing randomised rewards, or a virtual item that can be redeemed to receive a randomised reward, to consumers under the age of 21.

The second set of bills, House Bill 2727 and Senate Bill 3025, seek to establish disclosure requirements - including probability rates - for publishers of games that feature loot box mechanics. Furthermore, any digital or physical copies of games that feature loot boxes would be labelled as follows: "Warning: contains in-game purchases and gambling-like mechanisms which may be harmful or addictive".

GamesIndustry.biz has reached out to state representative Lee for comment regarding the legislation, and is awaiting a response.

Update (14/02/18): In response to an inquiry from GamesIndustry.biz, a spokesperson from the Entertainment Software Association defended the industry's record on self-regulation, and drew attention to existing consumer protection systems such as the ESRB classifications and parental controls.

"As an industry, we take our responsibility to consumers very seriously and continually work to create greater awareness and transparency about the wide range of in-game experiences," said the spokesperson.

"We strongly believe that the industry's robust, self-regulatory efforts remain the most effective way to address these important issues, and that system has a proven and long record of doing so.

"Some consumers and parents may have questions about how loot boxes work, and ESA has demonstrated a commitment to providing information to guide consumers, especially parents, in their purchase decisions."

Update (15/02/18): Hawaiian state representative Sean Quinlan has affirmed support of his colleague's efforts to "curb the proliferation of gambling mechanics in games that are marketed to children", saying he expects other states to follow Hawaii's lead in the "absence of strong signals from the industry that they will deal with the issue internally".

In December last year, Quinlan said that regulation would be a "slippery slope" and that the industry should self-regulate.

"When I was a teenager, a senator by the name of Joseph Lieberman tried to regulate the content of violent video games," Quinlan told GamesIndustry.biz. "His attempts to conflate video game violence with real world violence did lasting damage to the image of video games and certain publishers.

"I want to make it clear that we are only regulating a mechanism, not the content of the game itself. I would hope that any further legislation dealing with video games would similarly only look at particular mechanisms and not content itself.

"We live in an age where behavioral psychologists have discovered certain triggers and strategies that are extremely efficient at separating people from their money at a frightening pace. If even mature and intelligent adults are falling victim to these mechanisms, how are kids expected to respond?"

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Ivy Taylor

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Ivy joined GamesIndustry.biz in 2017 having previously worked as a regional journalist, and a political campaigns manager before that. They are also one of the UK's foremost Sonic the Hedgehog apologists.

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