South Korean Reforms Impose Loot Box Transparency, Refunds

March 4, 2024
Back
South Korea has greatly tightened loot box regulations, introducing mandatory odds disclosure and a customer refund scheme, while forming administrative and police monitoring groups for associated games.
Body

South Korea has greatly tightened loot box regulations, introducing mandatory odds disclosure and a customer refund scheme, while forming administrative and police monitoring groups for associated games.

The Korean Fair Trade Commission (FTC) on Tuesday (February 27) released revisions to online and mobile gaming terms and conditions that enhance player protection and require all companies to provide 30-day refunds.

The changes boost player awareness of the presence of loot boxes in games and the likelihood of winning items and at what cost.

In response to the “problematic” manipulation of loot box probabilities and the dearth of information on their operation, gaming companies must now display all data on loot box types and odds.

“The damage to users resulting from gaming companies' unilateral manipulation of [loot box] probability, or their non-disclosure of probability information regarding probability items, has been shown to be a major problem,” the FTC said.

The changes were foreshadowed by legislative reforms one year ago and are in force from this March 22.

Gaming companies must also allow in-game purchase refunds for at least 30 days after the transaction, including for games that are no longer active.

Acknowledging the difficulty facing gamers who request refunds from companies of deactivated games, the government will allow gamers to file for compensation from the companies without taking legal action.

Other changes include the formation of a 24-person Game Management Committee to monitor company compliance, and the deployment of dedicated police personnel nationwide to investigate gaming company fraud.

The reforms also extend to accountability for foreign gaming companies targeting the Korean market, with the E-Commerce Consumer Protection Act to be amended to require foreign interests to employ “domestic agents” as their representatives.

At the same time, the government has signalled the transfer of classification authority to the private sector amid a push to harmonise game classification with “global standards”.

The political importance of loot box manipulation is such that South Korean President Yoon Suk Yeol introduced the player protection reforms himself at a public forum on January 30.

Last month, the FTC fined leading gaming company Nexon Korea a record 11.64bn won ($8.7m) under the e-commerce act for offering items in its games that users had all but no chance of winning.

The FTC on January 3 said its three-year probe found that Nexon altered the odds for item acquisitions in the games MapleStory and Bubble Fighter in a manner that was unfair and that it failed to communicate or falsely reported the nature of the alterations.

The probe also found that Nexon had quietly and steadily degraded the efficacy of purchased in-game equipment.

Our premium content is available to users of our services.

To view articles, please Log-in to your account, or sign up today for full access:

Opt in to hear about webinars, events, industry and product news

To find out more about Vixio, contact us today
No items found.