Electronic Arts is facing two demands for the same reasons: FIFA loot boxes are a lot like gambling.
EA calls it “surprise mechanics,” but I call it paying, with your money, for the chance of being competitive online.
It’s a feature present on all current EA Sports games, from FIFA to NHL and Madden. And it relies on randomized loot boxes that grant players of various levels and rarities.
As you have to pay for a chance of getting something -with EA currency- international law could see it as gambling. Belgium and China already banned loot box practices on all video games.
Unsurprisingly, EA faces a class action demand in Canada, plus a €10 million fine in the Netherlands -backed by the Court.
Both parties state EA practices are predatory and misleading for children.
What are FIFA loot boxes?
FIFA 20 came out in September as a highly anticipated 2020 game. The title doesn’t change compared to the previous FIFA 2019, and the only different thing is the seasonal team update.
As usual, though, the new entry of the FIFA series includes several micro-transactions. It’s a feature that appeals to children mostly. It leads to kids emptying the digital wallets of their unaware parents.
A loot box is a pack of in-game objects players can buy with real money. The contents of the package are random. However, developers state they always add value to the player.
How do they work?
FIFA 20 lot boxes come in the form of “Ultimate Team Packs.” You can buy a pack of surprise players for your online team -Ultimate Team with your cash.
Some people compare the experience of buying a Pokemon, Yu-Gi-Oh, or Magic cards…or Gwent!
However, the comparison is not strong enough: real people pack the cards with everything the set needs to play a match. FIFA 20 is just a code deciding what you get. As such, your money could buy the same football player ten times.
Moreover, you can trade Magic cards in real life easily. The same process is more complicated on FIFA.
Thus, the days where you could play FIFA online without paying extra are long gone. You can still line up some loot boxes by expending in-game currency, but that’s a significantly slower process.
So, overall, FIFA 20 loot boxes are Randomized Ultimate Team football players for your online team. These are not “surprised mechanics” it’s a paywall to play the multiplayer feature that’s already a part of the game.
Keep in mind that the players you get have various qualities. It goes from Bronze to Silver and Gold. Moreover, the categories go deeper with Normal, Rare, and In Form versions. For instance, the In Form versions card adapts depending on how the player performs in the real-life league.
Also, there’s an Ultimate Team marketplace trading area where players can sell their cards.
These tactics are making about one billion dollars per year across the multiple EA Sports games.
That said, look at the trailer below. It doesn’t say anything about buying randomized player packages. It just promises Kaka, Zidane, and Seedorf as if it were easy.
What’s the big deal?
As an adult, I see a problem when a game asks me some extra cash to be competitive. I already paid once, so why do I need to keep giving these millionaires my hard-earned money?
Be that as it may, I find no issue when an adult buys a FIFA 20 loot box. You would know you’re gambling, and you would know you can either get nothing interesting or get much in return.
Kids, though, work differently. They are less prone to make a conscious, logical conclusion of what’s happening. Their minds will probably set in the “one more pack” mentality.
Here, Jimmy McGill (Better Call Saul’s protagonist) explains it better:
“The fallacy of sunk cost… It’s what gamblers do. They throw good money after bad, thinking they can turn their luck around. It’s like, “I’ve already spent this much money or time… whatever. I got to keep going!”
An algorithm creates FIFA 20 loot boxes, so your chance of a high reward doesn’t increase the more packages you pay. It’s always the same. Children won’t easily see it that way, though.
Also, remember the FIFA series games are PEGI, which means seven years old and forward can play…and gamble!
Netherlands demands EA because of FIFA loot boxes
Netherland’s demand comes with The District Court of The Hague’s support, one of the country’s 19 District courts. They failed against Electronic Arts on October 30, 2020. Here’s the original document.
Netherland’s demand comes with The District Court of The Hague’s support, one of the country’s 19 District courts. They in favor of the Netherlands gaming authority on October 30, 2020. here’s the original document.
The Netherlands Gaming Authority conducted a study on video game loot boxes in 2018. The survey considered eight different games. They didn’t reveal which games, though.
Their goal was differentiating loot boxes from gambling and the ability to trade with other players. According to Dutch laws, here’s what they concluded:
- Loot boxes that grant items you can’t trade with other players are gaming, not gambling.
- Crates of loot granting items you can trade is illegal, and thus gambling.
- Randomized boxes are forbidden under gambling regulations and laws if the items from the boxes are transferable.
- Loot boxes that work as a game of chance need a gambling license. High-risk/high-reward gambles with real currency can only happen under strict regulations.
- Gambling is illegal for children.
According to their results, they found four of those games were violating the laws. They didn’t make the names public, but they ask the developers to make changes before June 20, 2018. Otherwise, they would have to enforce the law.
Today, KSA said most companies complied, but Electronic Arts failed to do what they asked. As a result, EA faces a €10 million ($11.7 million) fine.
In particular, it’s €5 million agents EA, and €5 million against its Swiss division, which processes payment in European countries.
“Electronic Arts Inc. and Electronic Arts Swiss Sàrl violate the Gambling Act through its Packs in the FIFA videogame. The law stipulates that games of chance may not be offered without a license. This is not without cause; games of chance are high-risk products that can only be offered under strict conditions. Electronic Arts Inc. and Electronic Arts Swiss Sàrl are not licensed to offer games of chance.” – KSA press release.
Also, the KSA states these gambling mechanics are too attractive for children and happen without any regulations.
“The Ksa considers the violation of the law to be particularly serious given that a large number of children and young adults have access to Packs in the FIFA game and are particularly vulnerable to developing gambling addictions.” – KSA press release.
Lastly, they also presented ample evidence to the court, supporting the idea that games of chance can inherently make a person addicted to gambling. Kids are even more prone to become addicted.
The court responded with a more egregious fact. Players can access third-party websites to buy and sell FIFA cards, and prices go up to $2000.
What is the KSA demanding
Currently, the KSA demands EA to stop the practice and take away loot boxes in the Netherlands.
They ordered the fine back in 2019, but EA took the issue to Court. Generally, the video-game maker stated FIFA loot boxes are not games of chance according to the Betting and Gaming Act.
Instead, FIFA is a game of skill with an added random element. Moreover, FIFA packs have no value outside of the game.
But “skill + chance” is the very definition of most Casino card games. How could you play Poker without knowing how to bluff? Getting used to the rules of the game alone needs a lot of character.
Today, the District Court of the Hague also disagreed with EA. They ruled FIFA meets the requirements to be a game of chance under the Betting and Gaming Act. Even worse, they were conducting the games of chance without a license.
So, as you see, the KSA has a clear path to sue Electronic Arts. The Court authorized the organization to proceed with law enforcement.
In particular, the KSA is looking to protect vulnerable groups -minors- from gambling exposure.
I hope you forgive me for the reference, but I remembered a South Park episode. See, Stan Marsh became addicted to a mobile game: he could “pick up” coins to continue building the city but then had to wait to pick more coins. However, he could pay his father’s money -up to $20,000- to pick up more gold.
Freemium Isn’t Free s18e06.
Back then, South Park ripped a hole on freemium mobile games. But with titles like Genshin Impact and loot boxes on all EA Games and beyond, predatory practices are becoming more present on PC and console.
Freemium Isn’t Free s18e06.
It doesn’t get more real than this: Explore – Collect – Spend – Improve.
- Explore: Play challenges and leagues on FIFA 20’s offline mode
- Collect: gather your rewards from the offline mode.
- Spend: invest your rewards on some loot boxes. Spend some extra money as well, now that you’re there.
- Improve: your money made the Ultimate Team better. Let’s continue!
What is Electronic Arts going to do?
Let’s make a short summary:
- In 2018, KSA and the Court asked to make the online mode different, without gambling mechanics.
- The Court failed in favor of the NSA, stating FIFA Ultimate Team (FUT) violates the Netherlands’ gambling laws.
- Electronic Arts failed to make any changes.
- In October 2020, KSA demanded EA.
Now that we’re up to date, we can continue by explaining Electronic Arts will appeal the Court’s ruling. The game developer says they want to protect the interests of Dutch players:
“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.”
Where is this going?
The KSA is only trying to stop the FUT packs in the Netherlands. They are not looking to make the FIFA series illegal.
Still, the organization is charging a €500.000 fine to EA per each week they are not eliminating the system.
Yet, Electronic Arts is looking to take the case to one of the four appeal tribunals in the Netherlands. As the Epic vs. Apple battle, the final decision could take years. A lot of money brings a lot of power and leeway.
So far, EA is defending loot boxes by saying it’s part of the games’ expression. According to them, it may also be the way payers are “expressing themselves.”
The Court was not swayed by these arguments, though. They argued that the need to protect the people against illegal gambling is above corporate desitions and “expressions.”
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The Canadian legal action goes beyond FIFA loot boxes
Two Canadian plaintiffs sued Electronic arts for their loot crate mechanics on September 30.
They are looking for damage retribution due to an “unlicensed, illegal gaming system” in more than 60 titles.
The plaintiffs are Mark Sutherland and Shawn Moore. Sutherland is a Madden NFL player who has bought one too many loot boxes; Moore took the same choices on NHL games.
Either way, they state the Criminal Code of Canada forbids unregulated gambling. That includes bets and games of chance.
Naturally, EA doesn’t have a gambling license in Canada, so they are operating an “illegal gaming system through their loot boxes.”
The lawsuit goes on behalf of any Canadian customer who has purchased EA loot boxes. That means the list of games goes beyond the sports category: Need for Speed, Dragon Age, Mass Effect, and even Plants vs. Zombies are part of the package.
Earlier this year, EA faced a similar class-action demand in California. That case is still open.