ACCC pushing in-app purchase principles for children's games

The Australian consumer watchdog is advocating use of the UK guidelines for regulating in-app purchases on children's 'freemium' game apps.

The Australian Competition and Consumer Commission (ACCC) is advocating a new set of principles for governing in-app purchases for children's games, after investigating almost 350 games on Apple's App Store and Google's Play Store.

During its investigation, the ACCC found that less than a quarter of the so-called "freemium" game apps aimed at children on one platform disclosed the availability or necessity of in-app purchases at the buying stage; only once playing the game did this become known to the consumer.

"Once you're playing, many games make it clear that you can get ahead or avoid getting bogged down if you shell out for in-app purchases," ACCC deputy chair Delia Rickard said on Monday.

"Children exposed to this won't always connect a tap on the screen in the heat of the action with spending their parents' money in the real world."

The consumer watchdog is advocating that app developers follow the draft principles released in September by the United Kingdom Office of Fair Trading after it launched an investigation in April . Included in the principles are that customers be informed on the outset of possible in-app advertising or purchases, and that in-game payments only be authorised once the account holder has given "informed consent".

The ACCC is also undertaking an ongoing investigation into deceptive and misleading conduct regarding specific apps, and is encouraging platforms and app developers to adhere to the principles to avoid contravening Australian Consumer Law.

In September, the ACCC announced that it would collaborate internationally with more than 50 equivalent organisations in targeting freemium children's apps.

"Consumers need to be aware that 'free' may not mean free. Games and apps in the 'free' area of an online store may be free to download, but attract costs for in-app purchases," Rickard said at the time.

In July, Australia's Commonwealth Consumer Affairs Advisory Council (CCAAC) recommended that app developers and stores make it more straightforward for customers to attain refunds for accidental purchases, particularly in circumstances involving children; however, the CCAAC recommended against government regulation (PDF), finding that the current review systems within app stores are adequate to resolve such disputes.

The ACCC recommends directing complaints involving accidental in-app purchases to its website, or, if the purchases appear on your phone bill, to take the matter to the Australian Telecommunications Industry Ombudsman. The ACCC also offers tips on avoiding in-app purchases on its website.