The UK Office of Fair Trading is investigating whether in-app payments on smartphones and tablet computers are illegally encouraging children to spend money.
The investigation follows several recent cases in which children have spent large amounts of their parents' money on in-app purchases – usually in games – by accessing the default credit card associated with a device.
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"We are concerned that children and their parents could be subject to unfair pressure to purchase when they are playing games they thought were free, but which can actually run up substantial costs," said Cavendish Elithorn, senior director for goods and consumer at OFT, in a statement released today.
"The OFT is not seeking to ban in-game purchases, but the games industry must ensure it is complying with the relevant regulations so that children are protected. We are speaking to the industry and will take enforcement action if necessary," continued Elithorn.
As well as developers of micro-transaction-based games software, the OFT is also contacting parents and consumer groups to try and gather information on particularly "aggressive" practices being used to part users with their money.
In February, a family from Bristol whose son spent a total of £1,710.43 on in-app purchases for a game called Zombies vs Ninja on an iPad asked Apple for compensation. After an initial refusal from the company, and three days of correspondence, the company finally refunded the sum.
According to Ofcom statistics quoted by the OFT, 67 per cent of five to seven year olds now access the internet regularly at home, as well as 82 per cent of eight to 11 year olds.
Vanessa Barnett, technology and media specialist at law firm Charles Russell, commented: "The investigation by the OFT is welcome because this is clearly an economic and social issue in relation to such games."
However, added Barnett, the OFT should be careful not to "march down the route of over-prescriptive reform of regulation in the area".
"Ultimately, this area is a mix of parenting, education and responsible game design –and we need to make sure we balance those out from an obligations perspective," she continued. "If the OFT ultimately wants more regulation in the area, this could be detrimental to a flourishing, and growing, UK industry."
