Navigating global gaming regulations: A comprehensive overview

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Navigating global gaming regulations: A comprehensive overview

June 28, 2024•10 min

The games industry is continuously evolving, with millions of players engaging in diverse gaming experiences worldwide. As the industry grows, so does the complexity of the regulations that govern it. These regulations are designed to ensure a safe, fair, and enjoyable environment for all participants, and understanding these rules is crucial for developers looking to make a significant impact in the global market. Our previous article, SaaS Companies vs MoRs: Gaming Regulations, explored a high-level review of existing regulations. In this blog, we’ll dive into the different types of gaming regulations in different countries around the globe. *Legal disclaimer: This blog post is for informational purposes only and does not constitute legal advice. The regulatory landscape for gaming constantly changes and it’s essential to have a dedicated team of experts to monitor legal changes.

Types of Regulations

By understanding and adhering to global gaming regulations, you can not only ensure you earn and retain more revenue, you can also contribute to building a stronger gaming culture that keeps gamers playing. Let’s take a closer look at some key regulatory areas: Loot boxes Loot boxes have been a focal point of regulatory scrutiny due to concerns about their similarity to gambling. These regulations are designed to protect players, particularly minors, from potential exploitation and encourage transparency in game design. Different countries have adopted various approaches:

European Union: The EU lacks a unified stance, but countries like Belgium and the Netherlands have banned loot boxes, classifying them as a form of gambling.
Belgium: Mobile games and others have been banned due to the usage of loot boxes, which are considered gambling under the country's existing laws. The penalty can include a prison sentence of up to 5 years and fines of up to 800,000 euros for a first violation, which can double if the violation was perpetrated against a person younger than 18.
United States: Regulation is less stringent. The Federal Trade Commission holds workshops and discussions, but there are no federal bans.
Australia: Currently, there are no restrictions on loot boxes. However, starting September 2025, games with in-game purchases linked to elements of chance, including paid loot boxes, will receive a minimum rating of M (recommended for people over 15 but not legally restricted).
LatAm (Brazil): Proposed legislation regarding loot boxes is currently under evaluation and awaiting public hearings. If approved, companies selling loot boxes could face daily fines of up to $700,000.
MENA: Loot boxes are not regulated, with no specific information available regarding regulations or restrictions.
CIS: Loot boxes are not regulated, with no specific information available regarding regulations or restrictions.
Japan: Developers must meet three conditions: disclose the draw probability for each loot box item (with no specific guidelines on how and where to display this information), ensure players always receive loot box items valued at or above the purchase price, and prohibit real-money trading and secondary-market trading between players in the Terms of Service.
South Korea: Developers are required to disclose loot box probabilities transparently using percentages, fractions, or symbols. Any changes must be announced ahead of sales on game platforms and websites. The main channels for this information include in-game notifications, game homepages, and advertisements.
Taiwan: Developers must transparently disclose loot box probabilities as percentages. Information must be available on the main page of the website, login page, purchase page, or game packaging.
China: Loot boxes are completely prohibited.
India: The government has proposed banning online games that involve any form of gambling, including related advertisements.

Spending limits Several jurisdictions have implemented limits on the amount of money that can be spent within games to promote responsible spending and prevent financial distress for players. By setting spending limits, regulators aim to ensure that gaming remains a fun and sustainable activity without leading to excessive spending or gambling-like behaviors. These regulations are particularly focused on protecting younger audiences and promoting responsible gaming habits across all age groups:

United Kingdom: The UK Gambling Commission is advocating for stricter regulations, including the implementation of spending limits to mitigate problem gambling.
South Korea: The Game Rating and Administration Committee (GRAC) has established monthly spending caps: KRW 70,000 (approximately $60) for users under 18, and KRW 500,000 (approximately $430) for adults.
China: Chinese authorities have mandated new rules aimed at curbing in-game spending and rewards. Games are required to set limits on how much players can add to their digital wallets for in-game purchases.
Japan: The "gacha" law restricts spending on certain randomized in-game items to prevent excessive spending.

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Regulating gameplay time is crucial to preventing addiction and encouraging balanced gaming habits. Various countries have implemented specific measures to manage the amount of time players can spend on games: China: China has some of the strictest regulations for minors' playtime. Introduced in late 2021, these rules restrict players under 18 to gaming only between 8 PM and 9 PM on weekends and legal holidays, totaling just three hours per week. Enforcement combines regulations, technology, and penalties:

Regulations: The National Press and Publication Administration (NPPA) mandates these time restrictions.
Technology: Game companies must implement anti-addiction systems, including time limits, age verification, and real-name identification. Major publishers, like Tencent, use facial recognition technology to prevent minors from using adult accounts to circumvent restrictions.
Cooperation with developers and device makers: The government works with app developers, app store providers, and device manufacturers to create a comprehensive "minors' mode" across platforms and devices, ensuring age-appropriate content and screen time limits. This includes non-Chinese companies like Apple and Samsung.
Penalties: Non-compliant companies face formal warnings, fines, and the confiscation of any revenue generated illegally.

India: The Indian government is considering time limits for online gaming and real-money games to address addiction concerns, especially among children and young adults. The proposed measures aim to:

Prevent user harm, including self-harm and psychological issues, from online gaming.
Protect children from inappropriate or harmful online games through parental controls and age-rating mechanisms.
Reduce the risk of gaming addiction, financial loss, and fraud by providing frequent warning messages and allowing users to set their own limits for time and money spent.
Ensure that online real-money games do not compromise India's sovereignty and integrity.

Japan: Certain prefectures in Japan have local ordinances that limit game time for minors, emphasize the use of parental controls, and provide guidelines for responsible gaming. Vietnam: Players under 18 are legally restricted to 180 minutes of gameplay per day. Germany: Germany promotes self-regulation among game developers, encouraging the inclusion of features that allow players to set their own time limits. Virtual currency regulations Regulating virtual currency within games is crucial to prevent illegal activities such as money laundering and ensure financial transparency. Different countries have enacted specific laws to govern the use of virtual currencies in gaming. European Union: The 5th Anti-Money Laundering Directive requires that all virtual currency transactions be monitored and reported to combat illegal activities. United States: The Financial Crimes Enforcement Network (FinCEN) enforces compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations for virtual currency transactions. Japan: In 2016, Japan amended its Payment Services Act to regulate virtual currency in video games, becoming a pioneer in this field. This law specifically addresses prepaid payments, categorizing online game currency as "prepaid" due to its use for in-game purchases. Under the amendment, any unused virtual currency balance equal to or exceeding 10 million JPY must be reported to the tax authorities or set to expire within six months. Game developers are required to notify users of the automatic expiration of their virtual currency via the End User License Agreement (EULA) and a checkbox on the payment selection page, without offering refunds. If the virtual currency is not set to expire within six months, developers must report the unexpired amount to the tax authorities. Local presence and licensing requirements Adhering to local requirements is vital for game developers to gain market access, maintain legal compliance, and foster trust with local authorities and consumers. Each country has distinct regulations to ensure compliance with local laws and cultural standards: Vietnam: Vietnam enforces stringent censorship rules on video game content and prohibits the cross-border provision of games. Foreign developers must establish a local entity within Vietnam to sell their games, ensuring compliance with local cultural and regulatory norms. Indonesia: In February 2024, Indonesia enacted Presidential Regulation No. 19, recognizing the strategic importance of the gaming industry to the nation’s economy and culture. The regulation aims to boost collaboration among stakeholders, support domestic developers, and reduce reliance on foreign revenue. Key to this regulation is the requirement for game publishers to establish a legal presence in Indonesia. The Ministry of Communication and Information Technology (MOCIT) is tasked with creating a new business classification code for game publishers and facilitating the establishment of Indonesian entities or joint ventures with local partners. Non-compliance may result in measures by MOCIT to block operations. China: Foreign companies seeking to operate in China must partner with local entities and obtain licenses from the National Press and Publication Administration. This ensures adherence to strict content regulations and enables government oversight. Brazil: Brazil mandates local representation and compliance with specific content and consumer protection laws. This includes aligning game content with local cultural norms and providing adequate consumer safeguards. Game classification regulations Game classification systems vary globally, impacting how games are rated and marketed to consumers: Indonesia: Presidential Regulation No. 19 of 2024 outlines Indonesia's game classification system. Games undergo self-assessment and a suitability check by the Ministry of Communication and Information Technology (MOCIT). Publishers must display the MOCIT rating on game packaging, descriptions, and advertisements. Games are classified into age groups (e.g., 3+, 7+, 15+), with specific markings indicating parental guidance. Updates to classifications must be reviewed annually. The regulation prohibits game content involving pornography, real-money gambling, or violations of other laws. South Korea: The Game Rating and Administration Committee (GRAC) rates all game platforms (PC, online, mobile, console) under the Game Industry Promotion Act. Games must receive a rating before being produced and distributed to ensure compliance with national standards. xsolla-blog-global-gaming-regulations-featured-image-02-2112x966.webp

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Australia: The Australian Classification Board (ACB) assigns ratings like MA15+ (Mature Accompanied 15+), R18+ (Restricted 18+), and X18+ (Restricted 18+) to games and media. Games refused classification (RC) cannot be legally sold or imported, ensuring consumers access age-appropriate content under enforceable laws. GLOBAL REGULATIONS Many countries, such as Argentina, Brazil, China, India, Malaysia, New Zealand, and the United Kingdom, enforce strict rules on game content. These regulations may ban or restrict games featuring excessive violence, sexual themes, drug use, or content that offends cultural or religious sensitivities. For example, China bans games depicting violence or gambling, while Malaysia prohibits content deemed anti-Muslim or excessively violent.

Compliance and growth with gaming-specific MoRs

Gaming-specific Merchants of Record (MoRs) with experience in the gaming industry can provide expertise in navigating regulations and the compliance process for your game on a global scale. As regulations evolve—from age classifications to virtual currency compliance—MoRs can help you stay up-to-date with regulatory changes around the world. MoRs stay ahead of regulatory changes, offering insights and strategies to optimize your game’s market entry and sustain its success. Working with a gaming-specific MoR means tapping into a wealth of industry-specific knowledge and having a partner equipped to handle the nuances of gaming commerce. With decades of experience in the industry, Xsolla, as your Merchant of Record, can help you navigate the constantly evolving gaming regulations landscape while providing tailored solutions to optimize your gaming commerce. Partnering with Xsolla goes beyond simply navigating regulatory changes. Our deep industry knowledge and robust infrastructure empower you to optimize your gaming commerce in an ever-evolving regulatory landscape. If you're ready to learn more about how our team can amplify your game commerce, get in touch with our team today.