Today, EA lost a huge appeal against the Netherlands Gambling Authority, or Ksa, in a Netherlands district court. EA attempted to avoid fines related to FIFA Ultimate Team packs. The 10 million euro fine represents the first big loss by EA over their continued use of loot box mechanics, especially in its various Ultimate Team iterations. The ruling comes a few days after EA was expected to respond to a civil suit over loot boxes in Canada. It’s also the fourth related headline in 2020 alone.
The Origins of Fines Against EA Ultimate Team
The order to uphold the Ksa’s fines is a resolution of a case that started a few years ago. In 2018, the Ksa performed a study on loot boxes in games. In the study, the Ksa say they found a correlation between loot boxes and the development of a gambling addiction. As a result, Ksa asked developers to change loot boxes in games to avoid infringing on the Netherlands’ Gambling Act. In April 2018, the Ksa notified EA that FIFA Ultimate Team packs in FIFA 18 violated said Gambling Act. After failing to change FUT, EA received a second notification for FIFA 19.
In October 2019, the Ksa issued a 5 million euro (around $5.8 million) fine to both Electronic Arts Inc and Electronic Arts Swiss Sàrl, adding up to over $11.6 million in fines. EA appealed these fines in the District Court of the Hague. It argued that, among other things, disclosing these fines to the public would hurt its business and reputation. Ultimately, the court ruled in favorite of the Ksa. According to a statement provided to gamesindustry.biz, EA plans to appeal this decision.
EA’s Arguments Under Scrutiny
So, what does this mean for EA’s other ongoing lawsuits? While this ruling does not directly affect them, it does bring some insight into their arguments. In its other lawsuits, EA’s main defense is that, because items pulled from FUT packs cannot be sold outside of the game, they lack monetary value. This, EA argues, means that Ultimate Team is not covered under gambling regulations. The court’s ruling casts doubt on this argument. Since Ultimate Team currency can be, and are, sold outside the game, FUT items undeniably have value. Therefore, at least in the Netherlands, FUT packs fall under gambling regulations.
Of course, different countries have different regulations. Each court will interpret the legality and value of FUT packs differently. The dismissal of one of EA’s important defenses in any court does not bode well for future rulings, though.
The Ksa ends it’s statement on the decision by explicitly blaming EA for not making the necessary changes to their game. “Players who wish to file a complaint about the operation or modification of the game can contact the game’s providers. The game’s providers are the parties that decided to include a gambling game within the game, thereby breaking the law. The Ksa has pointed this out to Electronic Arts Inc. and Electronic Arts Swiss Sàrl repeatedly. Electronic Arts Inc. and Electronic Arts Swiss Sàrl are therefore itself responsible for changing the game such that it is no longer in contravention of the law. How exactly it accomplishes this is at their discretion.”
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