On January 30, 2014, the UK’s Office of Fair Trading (OFT) published final principles for online and in-app games and games producers, which must be implemented by April 1, 2014. Failure to do so can result in enforcement action by the OFT, or the Competition and Markets Authority (CMA) when it replaces the OFT and begins full operations on April 1. Once amendments to the Consumer Protection from Unfair Trading Regulations are adopted, consumers will also have a direct right of action for misleading or aggressive practices in this area.

The principles come out of a market investigation into the industry that began in April 2013 and that revealed a lack of transparent, accurate and clear up-front information relating to such things as costs and information material as to a consumer’s decision about whether to play or download a game. Of particular concern were games that are likely to appeal to children and situations involving unauthorised web and in-app purchases by children. Research showed that perhaps as much as £30 million a year in the UK may have been spent on unauthorised in-app purchases by children.

In addition to making clear that “in-game” payments are not authorised and should not be taken unless the payment account holder, such as a parent, has given his or her express, informed consent, the OFT has also published advice for parents to avoid unauthorised payments. These include making sure that a password is required for every purchase.

The OFT has indicated there has been positive engagement by the games industry in its investigation. And there have been reports in the press that some apps providers are already introducing new rules for developers creating apps aimed at children, including privacy policies, appropriate advertising and sections requiring parental permission.

Moreover, the OFT is cooperating with international partners with a view to ensuring that the principles are consistent with the laws of most jurisdictions and the raising of global standards in this area.