Video games giant Electronic Arts has vowed to appeal a €10 million ($11.7) fine handed down by Holland’s gambling regulator, Ksa, for violating the country’s Betting and Gaming Act. The regulator found that the loot boxes available in EA’s globally popular FIFA series of games contained “gambling elements.”
Loot boxes are virtual items attainable through gameplay or in-game microtransactions that offer a random chance to win other virtual items of varying desirability. In FIFA, gamers can spend real money to purchase FIFA Ultimate Team packs (FUT packs). Those offer randomized chances to unlock soccer players, with the goal of assembling the ultimate team.
It’s this element of real money, coupled with a chance-based reward, that concerns the Dutch regulator, as well, of course, as the game’s appeal to those under the legal gambling age.
The Ksa believes it is crucial to shield vulnerable groups, such as minors, from exposure to gambling,” the regulator said in its ruling.
“For that reason, the Ksa supports a strict separation between gaming and gambling. Gamers are often young and therefore particularly susceptible to developing an addiction. As such, gambling elements have no place in games,” it added.
EA ‘Reputational Damage’
EA has always fiercely denied that the loot boxes in its games constitute gambling. The company was warned by the Ksa in April 2018 that it did not share this view. The regulator gave it eight weeks to modify all its games on the Dutch market so that they complied with the law. This, EA failed to do.
The Ksa actually imposed the fine in October 2019. But EA contested it and attempted to block it from becoming public knowledge. EA said disclosing the fine to the public would disproportionately harm its business and hurt its reputation.
But this week a District Court in the Hague upheld the fine. The court ruled that the public’s right to know about unlawful commercial practices outweighed EA’s desire to protect its reputation.
Nothing of Value?
In its defense, EA argued that FUT packs could not be gambling because they do not offer anything of real-world value and cannot be converted into real money. But the court noted there are ways to profit from Ultimate Team cards, which can be valued at nearly €2,000.
In response to the argument that the Ksa’s decision to prohibit FUT packs violated EA’s right to “property and freedom of expression,” the court responded that EA still owns the rights to the game. Meanwhile, it added, “the Betting and Gaming Act’s existence assumes that the interests of society to regulate games of chance outweigh the interest to preserve people’s freedom to express themselves through games of chance.”
In a statement, EA said: “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.”