UK game developers could face invasive investigations if found to be in breach of IAP rules

UK game developers could face invasive investigations if found to be in breach of IAP rules
Craig Chapple

By Craig Chapple

January 30th 2014 at 3:42PM

It is important principles do not put UK game industry at a 'competitive disadvantage', says legal expert

UK developers who breach new principles governing the use of in-app purchases in games could face invasive investigations and even potential court proceedings, a legal expert has told Develop.

Earlier today the Office of Fair Trading outlined a set of principles games businesses should follow when using in-app purchases, such as being upfront about all costs, and warned the industry to "get its house in order" before the rules come into force on April 1st.

Harbottle & Lewis's Alan Moss has said the OFT could take various actions on companies who don't follow the principles, from educating developers and publishers on compliance to a more strict enforcement of the principles to serious offenders.

He added: "If the OFT believes a breach of the principles has occurred there are a range of actions that it could take from collaborative measures (such as educating studios and platforms how to comply with the principles) to more invasive investigations (such as investigating a studio’s or platform’s business and practices and requiring them to address issues) or draconian enforcement (such as issuing court proceedings), although this would likely be a last resort," he said.

"Currently, consumers do not have a direct right of action against businesses that have subjected them to aggressive or unfair practices. However, amendments to existing UK consumer protection laws which would give consumers such a right of action are currently being considered by the UK government."

Given the Office of Fair Trading is a UK organisation, questions have been raised over how these principles will affect companies based abroad. The OFT claimed it had worked closely with international partners to ensure new principles are "consistent with the laws of most key jurisdictions to help raise standards globally".

Moss said the OFT has no jurisdiction outside the UK, and therefore will not be able to take direct action against overseas studios or platform holders.

"The OFT has said that it is confident that the principles are consistent with the laws of 'most key jurisdictions' - we will need clarity on what the OFT means by ‘most key jurisdictions’ - and it appears likely that principles similar to the OFT’s principles will come into effect in those jurisdictions to create a level playing field," he said.

"It is important that the OFT’s principles are not considered to be more restrictive than the equivalent consumer protection laws of other countries so that the UK’s game industry is not placed at a competitive disadvantage."