Most Read Contributor in Australia, September 2016
On 9 December 2013, the Australian Competition and Consumer
Commission (ACCC) issued a media release which
called for new industry based principles to combat misleading and
deceptive conduct in the promotion of mobile phone game apps. Of
particular concern to the ACCC are "free" game apps which
target children and do not adequately disclose associated costs.
The ACCC has also indicated that it is willing to take enforcement
action where contraventions of the Australian Consumer Law are
In September 2013, the ACCC joined an international effort to
identify smartphone and tablet apps that may mislead young children
into making unauthorised in-app purchases. Of particular concern
were "free" apps that failed at the initial point of sale
to adequately disclose the potential for considerable in-app
purchases. These purchases are often capable of execution without
restrictive passwords or general parental oversight.
The ACCC conducted a sweep of more than 340 game apps in the
Google Play and Apple App stores. Fewer than 25% of child-friendly
"free" game apps investigated disclosed that in-app
purchases could be made. Fewer than 20% of child-friendly game apps
investigated included information about how to restrict devices to
prevent inadvertent purchases. Many also failed to provide access
to the terms and conditions prior to downloading the games.
The ACCC is supporting the implementation of principles in
Australia similar to those recently proposed in the UK by the UK
Office of Fair Trading. Those principles include notifying
consumers up-front about in-game costs and advertising, disclosing
important terms prior to download, and requiring that an account
holder such as a parent provides informed consent to payments
before they are authorised.
The UK's Office of Fair Trading has already circulated
principles for discussion. The consultation period closed in late
November and the results are due to be released by February
The ACCC is continuing to investigate concerns about misleading
and deceptive conduct in relation to numerous game apps. The ACCC
has also indicated that it may take enforcement action where
contraventions of the Australian Consumer Law have been identified.
These investigations suggest that a significant change to the
regulation of the mobile game app industry in Australia may be
imminent. App developers and platform providers should review their
current practices to avoid being pursued by the ACCC for
contraventions of the Australian Consumer Law.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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