Regulatory focus on free-to-play games and gambling ads on apps & websites

We reported yesterday on the forthcoming LCCP changes on age and identity verification that will take effect on 7 May 2019.

Amongst other things, the new age verification requirement will apply to free-to-play versions of games on websites of those who hold operating licences granted by the Gambling Commission. The Commission’s logic is that: “while free-to-play games are not technically gambling (there is no prize involved), there is no legitimate reason why they should be available to children”.

The age verification requirement will not apply to non-licence holders over whom the Commission has no regulatory powers, including those who supply solely social games or social casino games.

However, the Commission does sound a note of warning in its consultation response document that whether or not it advises the UK Government of the need for additional regulation for the social casino sector will depend on operators within that sector “pursuing a proactive and credible approach to social responsibility and an awareness of potential harm, which must continue to encompass best practice consumer measures”.

In the case of the concerns expressed in the Gambling Commission’s consultation response document:

  • the Commission has drawn a distinction between free-to-play games and social casino games, pointing out that the latter are available from generic platforms that provide a wide variety of apps and consumers are not able to access a real-money prize version of a social casino game within the same app;
  • by way of contrast, one of the motivations of  accessing free-to-play games on a licensed gambling operator’s website is to encourage players to familiarise themselves with a game before they play the real-money version that can only be accessed by adults;
  • as matters currently stand, allowing under 18 year olds to access free-to-play games on a licensed gambling operator’s website can have the effect of directly exposing them to real money gambling opportunities, which is why the Commission wants availability of such free-to-play tester products to be restricted solely to consumers whose age has first been verified.

The Commission sets out its complete position as follows, the numbers corresponding with the paragraph numbers in the consultation response document (that can be downloaded below):

Free-to-play games

3.19 Our concerns about the availability of gambling-style games to children also apply to games offered by non-gambling businesses (for example, social casino gaming, which we currently consider falls outside the scope of gambling legislation if no prize of money or money’s worth is awarded). While there is no clear-cut evidence that playing social-casino games is harmful for the vast majority of players, we remain concerned that it may lead to, or cause, more harmful behaviours in some circumstances. The similarities between social casino gaming and commercial gambling, including the elements of expenditure and chance, may result in harm for some.

3.20 We have continued to monitor developments within the social casino sector since our position papers of January 2015 and March 2017. We have gathered evidence from a variety of sources and worked in partnership with the industry and other regulators.

3.21 In the absence of specific statutory regulation of the social casino sector, the International Social Games Association (ISGA) has developed Best Practice Principles. These provide guidance to the social casino games industry on consumer protection. They include that social casino games should specify that the games are intended for use by those 18 or older and/or provide advice to parents and teens on making smart choices online. They also include that games designed for children should not contain direct exhortations to buy in-game items or to persuade an adult to buy items for them.

3.22 As outlined in our March 2017 paper, we have not yet advised Government of the need for additional regulation for the social casino sector. But we did warn that this position depends on the social casino industry pursuing a proactive and credible approach to social responsibility and an awareness of potential harm which must continue to encompass best practice consumer protection measures.

3.23 In drawing a distinction between free-to-play games and social casino games, it is important to note that social casino games are available from generic platforms that provide a wide variety of apps, and consumers are not able to access a real-money prize version of a social casino game within the same app. In contrast, consumers accessing free-to-play games on a licensed gambling operator’s website are directly exposed to real money gambling opportunities. The purpose of a free-to-play version of a game on such sites is to encourage players to familiarise themselves with a game prior to playing the real-money version, which can only be accessed by adults. We think it is appropriate for licensed operators to ensure that young people are not able to access their free-to-play tester products. Therefore, such games should only be available to consumers after their age has been verified.

It is also worth noting this week’s ASA ruling against Tombola (International) PLC (t/a Tombola Arcade), that can also be downloaded below.

Both that ASA ruling and the Commission’s new LCCP requirement (mentioned above) focus on concerns about children accessing apps and websites where gambling games are advertised. In the case of Tombola:

  • the “I’m a Celebrity, Get Me Out Of Here” app (published by ITV Broadcasting Ltd) had no built-in mechanism to target ads towards, or away from, certain groups of users;
  • that is why the ASA decided that Tombola had not taken sufficient care in its selection of media, to ensure that its gambling ads were directed at an audience aged 18 and over so as to minimise under-18s’ exposure to them;
  • the ASA decision appears to indicate that age-restricted ads cannot be shown via mobile apps unless the app contains a mechanism that effectively ensures that such ads are directed to an audience aged 18 so as to minimise the risk of children and young persons being exposed to them.