The House of Lords, specifically the Select Committee on the Social and Economic Impact of the Gambling Industry, called for loot boxes to be classified as gambling and regulated as such.

The wide-ranging report argues that "the liberalization of gambling through the Gambling Act 2005, the universal adoption of smartphones, and the abuse of soft-touch regulation by gambling operators have created the perfect storm of 24/7 addictive gambling."

Video games are a target, and reclassification of loot boxes is one of the report's key recommendations. The report also notes that other countries, such as Belgium and the Netherlands, have already initiated regulations. As for evidence, other reports and reports from various organizations and experts have been presented, not all of which support the recommendations of the ad hoc committee.

For example, the UK Gambling Commission issued a report stating that loot boxes are not gambling, at least under UK law, even though they contain elements of chance and winnings. The Commission concluded that no changes were necessary, but that social games should be watched closely.

Last year, the Department of Digital, Culture, Media and Sport conducted a nine-month parliamentary inquiry into loot boxes, reaching a different conclusion and recommending that a gambling content warning be applied to the games. The government also launched a call for evidence on loot boxes in June. The House of Lords, however, believes that the issue requires more urgent attention.

"We agree that it is essential that any legislative changes are evidence-based. The evidence we have heard emphasizes the urgency of taking action and does not draw attention to unintended consequences."

The report recommends that ministers should amend the Gambling Act now and bring loot under the jurisdiction of the Gambling Act, rather than waiting for a government review of the Gambling Act. They also warn that the legal definition of "games of chance" needs to be changed to cover "new products that blur the distinction between video games and gambling."

It therefore also seeks to give it the power under the Gambling Act to regulate "any activity that ministers consider to have the characteristics of gambling." Essentially, if it looks like gambling, it is gambling.

Industry group UKIE issued a statement on behalf of the UK gaming industry, saying it is working to address the issues raised in the commission's report.

"In January this year, the industry launched a wide-ranging 'Get Smart About P.L.A.Y.' campaign to increase the use of family controls to help parents and carers manage, limit or turn off gaming spending. Major platforms have also pledged to require that probabilities be disclosed for all games in which loot boxes appear. The PEGI age rating system also introduced a "paid random item" descriptor to inform consumers where loot boxes are featured in a game.

The full report can be read, but those interested only in the loot box section should skip to page 110.