Video game giants Valve are the first casualty of Dutch Gaming Authorities crackdown on controversial loot boxes which are deemed a form of gambling in the Netherlands.
The Dutch regulator had threatened to prosecute if the digital games distributor did not alter some of their games' designs by June 20. In response, the Bellevue, Washington-based company removed loot boxes for Counter-Strike: Global Offensive and DOTA 2 from the Dutch version of Steam.
Valve didn't immediately respond to a request for comment by Gambling Insider on Wednesday.
Valve's removal of the service relates to a study carried out by the Dutch Gaming Authority (Kansspelautoriteit) published in April. The study revealed that four of the ten loot boxes that were studied contravene the law.
“The reason is that the content of these loot boxes is determined by chance and that the prizes to be won can be traded outside of the game: the prizes have a market value. Offering these types of games of chance to Dutch consumers without a licence is prohibited," the report said.
In a statement published on Steam, Valve said: “We still don’t understand or agree with the Kansspelautoriteit legal conclusion. So for now our only practical alternative is to disable trading and Steam Marketplace transfers for CS:Go and Dota 2 items for Dutch customers.”
The Dutch Gaming Authority said it can impose administrative fines of up to €830,000 ($958,000) or 10% of the company's worldwide turnover (whichever is higher) if game companies have not made sufficient adjustments.
Dutch authorities have followed Belgium by taking a hard stance against loot boxes. Belgium's Minister of Justice Koen Geens has deemed FIFA 18, Overwatch and CS: GO’s loot boxes games of chance, subject to Belgian gambling law.
Companies who fail to comply with Belgian law risk a prison sentence of up to five years and a fine of up to €800,000 ($924,000) . When minors are involved, those punishments can be doubled, the Minister of Justice added.
The Netherlands are the first country so far to act on their previous rulings. Some reports suggest that EA Sports' FIFA 18, Psyonix's Rocket League and PUBG Corp.'s PlayerUnknown's Battlegrounds have all been singled out as failing to comply with Dutch law.