South Korean Ministry of Culture Issues First Public Warning to Foreign Game Developer for Probability Regulation Violation
Kang In sig / Published October 21, 2024 10:53 PM
Kang In sig
Courtesy of MCST
The South Korean Ministry of Culture, Sports, and Tourism (MCST), led by Minister Yoo In-chon, has issued its first public warning to a foreign game developer for violating probability disclosure regulations in loot box systems. The warning marks a significant step in the government's efforts to regulate gaming companies that operate within the country, ensuring that players have transparent access to in-game item probability information.
The game at the center of this controversy is Metem Psychosis, developed by RoamerPlan and distributed by Tianjin E-cool Co., Ltd. through its Hong Kong subsidiary, HONG KONG HONELESS PROJECT TECHNOLOGY CO., LIMITED. The game launched in July 2023, and one of its main business models includes the sale of a "Premium Jewel Box," a loot box whose probability information was not disclosed to players as required by Korean law.
In its investigation, the Ministry of Culture determined that the game's lack of transparency regarding item drop rates violated national regulations concerning probability-based in-game purchases. Loot boxes, which offer players a chance to win virtual items of varying value, have been a subject of regulatory scrutiny worldwide, with South Korea leading the charge in enforcing stricter rules on transparency and player protection.
Despite attempts by the Ministry to contact the game’s developers to resolve the issue, their inability to confirm the company’s registered address through standard methods led to the public notice. The notice was posted on the Ministry's website as a formal public warning, urging the developers to comply with local regulations by clearly displaying the probability information for all in-game items.
The Ministry’s move highlights the challenges governments face when dealing with foreign companies that offer services to domestic consumers. It also underscores the importance of following proper legal procedures when holding these companies accountable. Ensuring that every step adheres to the law is critical; otherwise, enforcement actions could be undermined, leaving players without the protection they deserve.
This case is particularly significant because it marks the first time the South Korean government has publicly announced regulatory action against a foreign game company for violating probability disclosure rules. Given that Metem Psychosis is distributed by a Chinese developer through Hong Kong, it also reflects broader concerns about the regulation of foreign gaming services within South Korea’s borders.
South Korea's regulatory framework around loot boxes has garnered global attention, with the government taking a firm stance on protecting consumers from unfair practices in games. Loot boxes, which often involve players spending real money for a random chance to receive valuable in-game items, have been criticized for their potential to exploit players through unclear or misleading probability information. The South Korean government’s clear legal guidelines require gaming companies to disclose the exact probabilities of receiving items from loot boxes, allowing players to make informed decisions about their purchases.
The Ministry of Culture's public warning can be viewed as part of a broader effort to enhance consumer protection in the gaming industry, especially as it relates to foreign companies providing services in South Korea. Although the enforcement of these regulations on international companies poses logistical and procedural challenges, the Ministry’s decision to issue a public notice indicates a strong commitment to upholding these standards.
This case is likely the first of many as the South Korean government continues to prioritize transparency in the gaming sector. By ensuring that foreign companies comply with local laws, South Korea is setting an example for other nations grappling with similar issues in regulating global gaming services.
The Ministry’s public warning, posted on its official website, serves as a reminder to all gaming companies—domestic and international—of the importance of transparency and compliance with South Korean laws. As the gaming industry continues to grow, the government’s role in protecting consumers from unfair practices will remain a critical issue.
Sayart / Kang In sig, insig6622@naver.com
Courtesy of MCST
The South Korean Ministry of Culture, Sports, and Tourism (MCST), led by Minister Yoo In-chon, has issued its first public warning to a foreign game developer for violating probability disclosure regulations in loot box systems. The warning marks a significant step in the government's efforts to regulate gaming companies that operate within the country, ensuring that players have transparent access to in-game item probability information.
The game at the center of this controversy is Metem Psychosis, developed by RoamerPlan and distributed by Tianjin E-cool Co., Ltd. through its Hong Kong subsidiary, HONG KONG HONELESS PROJECT TECHNOLOGY CO., LIMITED. The game launched in July 2023, and one of its main business models includes the sale of a "Premium Jewel Box," a loot box whose probability information was not disclosed to players as required by Korean law.
In its investigation, the Ministry of Culture determined that the game's lack of transparency regarding item drop rates violated national regulations concerning probability-based in-game purchases. Loot boxes, which offer players a chance to win virtual items of varying value, have been a subject of regulatory scrutiny worldwide, with South Korea leading the charge in enforcing stricter rules on transparency and player protection.
Despite attempts by the Ministry to contact the game’s developers to resolve the issue, their inability to confirm the company’s registered address through standard methods led to the public notice. The notice was posted on the Ministry's website as a formal public warning, urging the developers to comply with local regulations by clearly displaying the probability information for all in-game items.
The Ministry’s move highlights the challenges governments face when dealing with foreign companies that offer services to domestic consumers. It also underscores the importance of following proper legal procedures when holding these companies accountable. Ensuring that every step adheres to the law is critical; otherwise, enforcement actions could be undermined, leaving players without the protection they deserve.
This case is particularly significant because it marks the first time the South Korean government has publicly announced regulatory action against a foreign game company for violating probability disclosure rules. Given that Metem Psychosis is distributed by a Chinese developer through Hong Kong, it also reflects broader concerns about the regulation of foreign gaming services within South Korea’s borders.
South Korea's regulatory framework around loot boxes has garnered global attention, with the government taking a firm stance on protecting consumers from unfair practices in games. Loot boxes, which often involve players spending real money for a random chance to receive valuable in-game items, have been criticized for their potential to exploit players through unclear or misleading probability information. The South Korean government’s clear legal guidelines require gaming companies to disclose the exact probabilities of receiving items from loot boxes, allowing players to make informed decisions about their purchases.
The Ministry of Culture's public warning can be viewed as part of a broader effort to enhance consumer protection in the gaming industry, especially as it relates to foreign companies providing services in South Korea. Although the enforcement of these regulations on international companies poses logistical and procedural challenges, the Ministry’s decision to issue a public notice indicates a strong commitment to upholding these standards.
This case is likely the first of many as the South Korean government continues to prioritize transparency in the gaming sector. By ensuring that foreign companies comply with local laws, South Korea is setting an example for other nations grappling with similar issues in regulating global gaming services.
The Ministry’s public warning, posted on its official website, serves as a reminder to all gaming companies—domestic and international—of the importance of transparency and compliance with South Korean laws. As the gaming industry continues to grow, the government’s role in protecting consumers from unfair practices will remain a critical issue.
