'Loot box’ transparency to swing wide open with new gaming laws

Visitors try out new games rolled out at G-Star 2023, the biggest annual game festival in Korea, held at Busan's Bexco convention center last November. [NEWS1]

Game companies active in Korea will be obligated to clarify information regarding so-called loot box systems within their games starting next month to comply with fair trade practices, according to the Korea's antitrust regulator on Monday.

The Fair Trade Commission (FTC) revealed a new set of regulations that will take effect from March 22 in a clampdown on loot box systems, or in-game lucky draws purchased by players that may or may not be favorable to their gaming situation.

The move comes on the heels of President Yoon Suk Yeol’s call for solutions to protect consumer rights within the local game industry at a town hall meeting last month.

Noticeable changes include making it mandatory for game companies to state information regarding loot box items within the services of mobile and online games, such as disclosing probability data.

The companies also need to open a customer channel for at least 30 days after the service is terminated to refund in-game purchases made prior to the closure. Although refunds were available before, it was difficult for users to request repayment as related game services and companies became uncontactable after the game shut down.

Furthermore, the antitrust regulator will institute a system where users can directly request compensation for terminated services from the gaming companies without filing a suit.

To make the law applicable to foreign companies, the FTC will implement a system to establish local agents for the companies for efficient communication.

Specifics into the new regulations will be disclosed Tuesday to be recommended for immediate implementation, and it will be gradually reflected in the current Game Industry Promotion Act and the Act on the Consumer Protection in Electronic Commerce.

The FTC has been toughening restrictions on the much-criticized loot box model that Korean game companies have relied on. Last month, it slapped an 11.6 billion-won ($8.7 million) fine on Nexon, one of the country’s leading game developers and publishers, for misleading its users to purchase in-game items with false information.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]