Mystery boxes

Ergates

Is there provision in CCR for gambling?   This is, essentially, an online equivalent of a tombola - one of those "every ticket wins a prize" ones (where mostly you just win a sweet).

If you did a literal tombola online, would you be able to return the item you won?

the_lunatic_is_in_my_head

Ergates said:

Is there provision in CCR for gambling?   This is, essentially, an online equivalent of a tombola - one of those "every ticket wins a prize" ones (where mostly you just win a sweet).

If you did a literal tombola online, would you be able to return the item you won?

A good point Gambling, as defined in the Gambling Act itself, is indeed excluded from the CCRs, but I'm not sure mystery boxes fall under the Gambling Act?

MyRealNameToo

the_lunatic_is_in_my_head said:

Ergates said:

Is there provision in CCR for gambling?   This is, essentially, an online equivalent of a tombola - one of those "every ticket wins a prize" ones (where mostly you just win a sweet).

If you did a literal tombola online, would you be able to return the item you won?

A good point Gambling, as defined in the Gambling Act itself, is indeed excluded from the CCRs, but I'm not sure mystery boxes fall under the Gambling Act?

Actually if mystery boxes were considered gambling, and if not should they be, was considered previously thought they were looking at it in the context of online gaming where you use real cash to buy in game credits that you then use to buy/unlock a chest/loot box which contain random upgrades for your characters. 

https://commonslibrary.parliament.uk/research-briefings/cbp-8498/

The decision by government at the time was it wasnt gambling and they didnt propose to extend the definition to include them. 

These things are a matter of perspective though, insurance as we know it in the UK is haram under islam because it's considered gambling. A different form of insurance (known as takaful) is acceptable which is effectively a pure mutual insurer with restrictions on what investments they can do with premiums. 

A_Geordie

Good spot @Ergates I didn't actually think about gambling in this context but it's a very valid point. Re the point made by @MyRealNameToo I think the main reason why loot boxes were not considered gambling was because they didn't have a cash out value outside of the game.

In the current scenario, the goods do have a cash out value in the real world. The Gambling Act has various definitions and I'm not expert on the law surrounding it but the arrangement could fall inside the definition of a simple lottery: 

(1) For the purposes of this Act an arrangement is a lottery, irrespective of how it is described, if it satisfies one of the descriptions of lottery in subsections (2) and (3).

(2) An arrangement is a simple lottery if—

(a) persons are required to pay in order to participate in the arrangement,

(b) in the course of the arrangement one or more prizes are allocated to one or more members of a class, and

(c) the prizes are allocated by a process which relies wholly on chance.

There are a variety of exemptions in the Act that means you are not subject to licensing requirements, though I don't think they apply here due to the value of the goods.

That said, the term that the OP referred to was in relation to the mystery box goods. From what I can see, the T&Cs don't suggest you can't return the purchased item. 

the_lunatic_is_in_my_head

A_Geordie said:

That said, the term that the OP referred to was in relation to the mystery box goods. From what I can see, the T&Cs don't suggest you can't return the purchased item. 

Part 1: Mystery Boxes

1. Each mystery box contains random items worth equal to or greater than the purchase price.

2. Contents cannot be chosen, returned, or exchanged after purchase.

3. Mystery boxes are not eligible for other promotions, including member discounts or Early Bird Credit offers.

Are you suggesting the wording is lax enough to be exploited to the consumer's favour or?  

GDB2222

the_lunatic_is_in_my_head said:

Ergates said:

Is there provision in CCR for gambling?   This is, essentially, an online equivalent of a tombola - one of those "every ticket wins a prize" ones (where mostly you just win a sweet).

If you did a literal tombola online, would you be able to return the item you won?

A good point Gambling, as defined in the Gambling Act itself, is indeed excluded from the CCRs, but I'm not sure mystery boxes fall under the Gambling Act?

https://www.gamblingcommission.gov.uk/public-and-players/guide/page/types-of-lottery-you-can-run-without-a-licence

3. I'm a business owner who wants to run a lottery for my customers

A customer lottery can be run by a business if the lottery will take place at its physical location or premises. You can only sell tickets to customers when they're on your premises for business purposes.

Customer lottery

Find out how to run a customer lottery. It is illegal to make a profit from customer lotteries. All of the money raised by ticket sales must be used to pay for prizes and any expenses for organising the lottery. Prizes must be under £50 in value.

However, if this is an overseas company, I have no idea how this applies in practice?

the_lunatic_is_in_my_head

Their T&Cs do state the agreement is governed by the laws of your region so the CCRs should apply (bar the possible exemption due to gambling) but equally the Gambling Act should also then apply. 

If you were so inclined to establish for certain whether it’s gambling as defined in the Act the Gambling Commission might know that answer:

https://www.gamblingcommission.gov.uk/forms/contact-centre/general

20! working days to reply to a web form message so probably better to call them. 

A_Geordie

the_lunatic_is_in_my_head said:

Part 1: Mystery Boxes

1. Each mystery box contains random items worth equal to or greater than the purchase price.

2. Contents cannot be chosen, returned, or exchanged after purchase.

3. Mystery boxes are not eligible for other promotions, including member discounts or Early Bird Credit offers.

Are you suggesting the wording is lax enough to be exploited to the consumer's favour or?  

In short, no. I somehow got mixed up with the Black Friday deals thinking that the mystery box was on condition of buying 'something else', and if that was true, could have been argued that the mystery box is a collateral contract, which is an entirely independent contract entered into based on certain promises under the main contract. That would not have affected the right to return under the CCRs. 

However, I'm inclined to agree with Ergates on the gambling point and therefore the CCRs are unlikely to apply . Also, I did look into the Gambling Act a bit more and from what I can understand, this is likely to amount to a lottery within the definition I gave earlier and most lotteries are deemed illegal unless you have a gambling licence or an exemption, of which there are very few exemptions. To get around the licence requirements, you would typically need to convert this into a competition (game of skill rather than chance) or a prize draw which are free and has no monetary value to enter. 

Is there a get out that favours the consumer? Yes, either on the basis of faulty goods under the Consumer Rights Act or unfair commercial practices under the Digital Markets, Competition and Consumers Act. On the face of it, I don't think there's anything that could be relied on as an unfair commercial practice under the DMCCA, unless the consumer can show that they have been misled in some way, such as the way prizes have been assigned/distributed or this 'lottery' fails to give the consumer a fair chance to win and the % of chance for each potential prize doesn't tally up - but that's likely difficult to prove in practice I think. 

I did check whether Anker/Fantasia Trading LLC had a gambling licence too. The answer is no and except for that, the mystery box seems to be above board in all other respects.

Edit: The link below might help on whether a lottery is considered exempt.

https://www.gamblingcommission.gov.uk/guidance/lotteries-and-the-gambling-act-2005/lotteries-and-the-ga05-types-of-lottery-that-do-not-require-a-registration

GDB2222

This clearly doesn’t constitute an exempt lottery. For a start, some of the boxes cost more than the £50 exemption limit, and many of the goods are over that limit, even allowing for some hype of the values.

If this is an illegal lottery, can you do a chargeback? I don’t think it would be at all easy to sue an overseas company , so a chargeback is the only feasible way to get your money back.

A_Geordie

GDB2222 said:

This clearly doesn’t constitute an exempt lottery. For a start, some of the boxes cost more than the £50 exemption limit, and many of the goods are over that limit, even allowing for some hype of the values.

If this is an illegal lottery, can you do a chargeback? I don’t think it would be at all easy to sue an overseas company , so a chargeback is the only feasible way to get your money back.

Don't think a chargeback is going to help you here as that process is usually limited to disputes such as misrepresentation, goods not receive or not of satisfactory quality/described.

That said, it is not clear from the T&Cs who the contracting entity actually is when you purchase goods. The website suggests Anker Technology (SG) pte Ltd is the owner and which is a company in Singapore, but Anker does list a number of companies at the bottom of the T&Cs, one of which is a UK company. It would be worth checking the invoice to confirm the entity because if it is the UK company, that could suggest the contract is not with a foreign company and the possibility of a claim would be much more simplified than having to pursue one of their foreign companies.