Australia's Regulations on Loot Boxes and Recommendations

Abstract

This paper examines Australia's recent regulatory framework for loot boxes in video games, which came into effect on 22 September 2024. The new rules classify games containing loot boxes or other chance-based in-game purchases as Category M, restricting access to children under 15. The study explores the logic behind loot boxes, their psychological and financial impact on players, and compares Australia's approach to regulations in other jurisdictions such as Belgium, the UK, and China. The analysis highlights the addictive nature of loot boxes, their resemblance to gambling, and the potential risks they pose, particularly to minors. The paper concludes with recommendations for improving Australia's regulatory framework, including stricter categorization, real-name verification systems, and enhanced transparency in loot box mechanics.