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16 October 2020

Q&A: In-app purchases and the Law

The Covid-19 pandemic, particularly during lockdown, saw a higher demand on downloads and in-app purchases, in fact it was reported that Apple iPad downloads rose by 40% in comparison to the previous year. However, it is not just children that spend time playing or downloading online games, the in-app business is now reported to be a $380 billion global business.

Dispute Litigation Solicitor, Jonothan Broadbent recently took part in a live Q&A Twitter chat with the Law Society #SolicitorChat to discuss in-app/in-game purchases and the consumer rights laws that are in place to protect in-app/in-game purchases.

Q1. What consumer rights laws protect in-app/in-game purchases?

The main laws are the Consumer Protection from Unfair Trading Regulations 2008, the Unfair Terms in Consumer Contracts Regulations 1999, the Electronic Commerce (EU Directive) Regulations 2002 and the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

Q2. What rights does a consumer have to a refund if a in-app/in-game purchase is made by mistake?

The Office of Fair Trading has given their advice on this, bringing in various elements of consumer rights law. The basic position is that payments should not be taken from the payment account holder unless authorised. A payment made in a game is not authorised unless express, informed consent for that payment has been given by the account holder. The account holder should positively indicate their informed consent for each purchase. Therefore, it is logical that your child, who is not the account holder, cannot give their consent. If the game they are playing has not attempted to get consent from the account holder for a payment, the payment has been made without authorisation and the consumer is entitled to a refund.

Q3. What can you do if the company you purchased the digital content from won’t respond to your request?

If you have exhausted the content creator’s dispute resolution procedures then you should contact Citizens Advice Consumer Service (Advice Bureau) for more advice. You can also submit your complaint through the Online Dispute Resolution (ODR) platform which deals specifically with disputes arising from online transactions. If you still cannot resolve your dispute then you may need to commence legal proceedings but bear in mind the cost of legal proceedings versus the amount of money you are claiming for – in almost all cases the value will be less than £10,000 and so will be dealt with by the Small Claims Court.

Q4. Are there any extra conditions for games that target children that must be adhered to?

Games must not exploit children’s inexperience, vulnerability or credulity by, for example, aggressive commercial practices such as persuading them that certain purchases must be made in order to win the game or to advance in the game. Games must also differentiate clearly between commercial messages and gameplay – for example, it should be clear what parts of the game are free to play and what parts of the game need purchases in order to be played.

Q5. What can parents do if they are concerned about their children making unauthorised in-app/in-game purchases?

Ensure that your device has been set up so that a password needs to be entered each time someone tries to buy something inside an app or a game. This is fairly straightforward to set up on most mobile devices and all games consoles. You will also be able to set up family/parental controls on most devices which do not allow in-app/game purchases at all.

If you would like to speak to a member of the Dispute resolution team please call 01603 598000 or email disputes@steeleslaw.co.uk and a member of the team will be happy to contact you.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

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