European move towards protecting users from harmful practices in video games: EU Consumer Protection Cooperation Network in action!

Ahead of the discussion and possible adoption of the Digital Fairness Act, the Consumer Protection Cooperation Network (the CPC Network) has identified a need for European consumers to be better protected when playing video games.

What are the new key principles for in-game virtual currency?

The CPC Network has set out these non-exhaustive key principles which the CPC would like to see video game companies and gambling operators act upon when offering in-game virtual currencies:

1. Price indication should be clear and transparent: The price of in-game digital content or services must be provided in real-world money to allow consumers to make informed purchasing decisions. In practice, any item sold in in-game shops must show both in-game currency and real-world currency.
2. Practices obscuring the cost of in-game digital content and services should be avoided: Traders should not engage in practices that could mislead consumers by obscuring the price of in-game digital content or services. Avoid mixing different in-game virtual currencies in one game or requiring exchanges of in-game currency.
3. Practices that force consumers to purchase unwanted in-game virtual currency should be avoided: Traders should not design video games in ways that force consumers to spend more real-world money on in-game currency than they need. In practice, consumers should be able to choose the specific amount of in-game currency to be purchased.
4. Consumers should be provided with clear and comprehensible pre-contractual information: Traders should comply with their legal obligations to provide consumers with clear and comprehensible pre-contractual information when offering the purchase of in-game virtual currencies.
5. Consumers’ right of withdrawal should be respected: Traders should inform consumers of the steps for exercising their right of withdrawal and allow them to exercise that right within 14 days of the purchase. According to the CPC Network, users must, for example, be able to withdraw from the purchase of any remaining in-game currency they have not yet used to make purchases.
6. Contractual terms should be fair and written in plain and clear language: The terms and conditions related to the purchase of in-game virtual currency or digital content should be written in plain and clear language.
7. Game design and gameplay should be respectful of different consumer vulnerabilities: Traders should consider the vulnerabilities of the players and ensure that the gameplay does not exploit these vulnerabilities or unfairly influence consumers’ economic behavior. In particular, parental controls must be provided to avoid purchases and any communication to minors must be carefully reviewed, to avoid unlawful influences.

The key principles published address concerns raised by the European Consumer Organisation (BEUC) and should help creating a safer, more transparent experience for players in accordance with European consumer protection legislation.

What should video game companies and gambling operators do now?

To avoid an investigation under the CPC Regulation or national laws, any video game or other content published should be reviewed and amended where necessary. These new key principles will bring significant changes to many currently available games, as they target common practices currently available in the market.

How will these key principles be enforced?

The European authorities may enforce these new principles either via the CPC Regulation or national law. An enforcement via the CPC Regulation is more likely if the same content is available in more than two European states. In such a case, an investigation will be opened, in which targeted companies may either make commitments to change or face potential fines of up to 4% of their annual turnover. On a national level, throughout Europe, various enforcement mechanisms exist, which may either be administrative proceedings or lawsuits. Some national laws provide for fines, while others only end in cease and desist orders.

Note that the European Commission should be hosting a workshop where gaming companies operating in the EU will be encouraged to present concrete steps, they will take to implement these key principles. More to come in that space !