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In-app purchases: European Commission and Member States welcome new proposals from main industry players

22-12-2014

One year ago, national consumer protection authorities from EU countries joined forces with the European Commission to ask main industry players to propose concrete solutions on the issue of in-app purchases in online games advertised as free. In July 2014, the European Commission announced that there was real progress with tangible results in this joint action. At that point, Apple and Google made a number of engagements to better inform consumers about the true costs involved in certain on-line games and to strengthen the payment authorisation settings. Since then, Google has been implementing its comprehensive engagements. Following the recommendations of national authorities, Apple has made further proposals which national authorities considered to be a positive step, especially with regard to the withdrawing of the  use of the word "free" when games offer in-app purchases and to the preparation of a change of default payment settings.

A common position agreed by national authorities within the CPC network and communicated to Apple, Google and the Interactive Software Federation of Europe in December 2013 asked that:

  • Games advertised as "free" should not mislead consumers about the true costs involved; 
  • Games should not contain direct exhortation to children to buy items in a game or to persuade an adult to buy items for them; 
  • Consumers should be adequately informed about the payment arrangements for purchases and should not be debited through default settings without consumers’ explicit consent; 
  • Traders should provide an email address so that consumers can contact them in case of queries or complaints. As a result of this joint action, the following engagements have been taken:
  • Google, which made these engagements already in July, is so far not using the word "free" at all when games contain in-app purchases and has developed targeted guidelines for its app developers to prevent direct exhortations to children as defined under EU law. It has also adapted its default settings, so that payments are authorised prior to every in-app purchase, unless the consumer actively chooses to modify these settings. 
  • Apple has also committed to discontinue the use of the word "free" in the button used to download games  with in-app purchases, and informed its app developers of the relevant EU legislation. It is also preparing a substantial change to its payment authorisation settings for next spring so that users will be able to choose between options in a neutral way. 
  • Both companies will make available contact email addresses or electronic forms including of the applications' developers and the possibility for authorities to notify complaints.

The European Commission and Member States will continue to monitor the issue and in particular the extent to which the engagements made by the online game industry and platforms will in fact address the concerns raised by European consumer protection authorities.

Background

The EU Consumer Protection Cooperation (CPC) Regulation (EC N°2006/2004) links national consumer authorities in a pan-European enforcement network. Thanks to this framework, a national authority in one EU country can call on their counterpart in another EU country to ask them to intervene in case of a cross-border infringement of EU consumer rules. The cooperation is applicable to consumer rules covering various areas, such as the Consumer Rights Directive, the Unfair Commercial Practices Directive and the Unfair Contract Terms Directive. This EU-level action is carried out to address wide-spread infringements without prejudice to ongoing or future actions on outstanding legal issues carried out by Member State authorities.

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