Japanese Premiums and Representations Act Checks for Game Gacha: Complete Gacha and Probability Disclosures

Hello, I am Noriaki Asato, Managing Attorney of LegalAgent.

When a game introduces a gacha feature, the legal team often becomes involved after the item lineup, drop probabilities, guaranteed-reward threshold and collection bonuses have already been decided. Starting the review only after detailed design is complete can reveal issues under Japan's Act against Unjustifiable Premiums and Misleading Representations that require substantial changes and rework. Gacha rules differ from the rules for ordinary discounts and promotional giveaways, so the order of the review matters.

Distinguishing paid gacha items from accompanying promotions

The starting point is that the items purchased through paid gacha are not themselves premiums under the Act against Unjustifiable Premiums and Misleading Representations.

The Consumer Affairs Agency explains this in its guidance on complete gacha in online games and premium restrictions (Japanese), published on May 18, 2012 and partially revised on April 1, 2016. Under Article 2(3) of the Act, premiums are economic benefits designated by the Prime Minister that a business supplies in connection with transactions in its goods or services as a means of attracting customers. An item obtained through paid gacha is the subject of the purchase itself, which distinguishes it from a premium accompanying a transaction. The maximum-value restrictions for prizes in general prize competitions therefore do not directly apply to the items purchased through paid gacha. Other rules, including restrictions on misleading statements about probabilities and purchase conditions, still need to be considered.

Accompanying promotions may, however, be subject to premium restrictions. Additional items for customers who make a specified number of purchases, first-purchase benefits and prize draws for users who post their gacha results on social media should be reviewed to determine whether they offer a separate economic benefit connected with a transaction to attract customers. The label given to a promotion does not decide the issue: the purchased product, participation conditions and method of providing the additional benefit must be examined. Promotions that qualify as premiums should be checked against the rules for general prize competitions or giveaways to all eligible customers, as discussed in our premium regulation checklist for campaigns.

Why complete gacha is prohibited as card matching

Complete gacha requires a separate assessment of the items purchased through paid gacha and the additional reward obtained by completing a collection.

Where collecting a specified combination of different item types obtained through paid gacha entitles the user to another item, that additional item is a premium accompanying the gacha transactions. The Consumer Affairs Agency regards this provision of premiums through complete gacha as prohibited card matching. This does not mean that the purchased items themselves become premiums.

The item images displayed on screen are treated as tokens under the relevant Japan Fair Trade Commission notice. Paragraph 5 of the Restrictions on the Provision of Premiums by Prize Competitions (JFTC Notice No. 3 of 1977) prohibits providing premiums for collecting a specified combination of different types of tokens, regardless of the premium's value. This method, known as card matching, is prohibited because its reliance on chance can strongly stimulate users' desire to win and encourage excessive spending. Calling the feature a completion bonus or set reward does not change that assessment where the substance is an additional reward for collecting the required combination. This structure should be identified during specification design.

Probability disclosure guidelines and misleading representations

There is no statutory provision that uniformly requires probability disclosure for all gacha features; industry guidelines play a major role.

The Computer Entertainment Supplier's Association (CESA) guidelines for operating random item provision in network games (Japanese) generally require disclosure of the probability of obtaining every item available through paid gacha, in a place or manner that users can readily recognize. They also permit alternative disclosures under specified conditions. These are voluntary rules for endorsing member companies and apply to network games provided for smartphones in Japan. Businesses should separately check the standards of their industry association and the terms of their distribution platforms.

The Act against Unjustifiable Premiums and Misleading Representations does not contain a uniform probability disclosure requirement for every paid gacha feature. However, Article 5 may apply where a probability displayed in the game or an announcement misleads ordinary consumers into believing that the content or terms are significantly better than the actual configuration and satisfies the other requirements, including unfairly attracting customers. Review the impression conveyed by the explanation as a whole, as well as the numerical disclosure.

Guaranteed-reward announcements and substantiation of claims

Differences between a representation and the actual configuration should be examined against the requirements for misleading representations about quality under Article 5(i) and transaction terms under Article 5(ii). For example, announcing a period of increased probabilities without changing the configuration raises questions about how users understand the game's content or transaction terms.

A guaranteed-reward or “pity” feature, under which a user obtains a desired item after a specified number of draws, must operate in line with its stated conditions. For example, a store description promising a guaranteed item after 200 draws when the actual threshold is 300 may constitute a misleading representation about transaction terms. Conditions affecting purchase decisions should also be explained, including which gacha pool qualifies, whether draw counts carry over and what happens when the offer period ends.

The substantiation rule in Article 7(2) allows the authority to request materials providing reasonable grounds for a representation when assessing whether it is misleading about quality. If the business does not submit the materials within the specified period, the representation is deemed misleading about quality for the purpose of a corrective order. This rule does not apply generally to misleading representations about transaction terms. Regardless of whether it applies, configuration logs and the history of changes to draw tables should be retained so that the business can explain how the announced probabilities and guaranteed-reward settings were implemented.

Checks before implementing gacha

Checking the following points early in planning can help prevent rework:

• Whether items are provided individually or a separate reward is offered for collecting a specified combination.
• Whether accompanying promotions include benefits based on the number of draws or social media participation.
• Whether the probabilities shown on screen match the actual draw program settings.
• Whether announcements about increased-probability periods and eligible items match the implementation.
• Whether the guaranteed-reward threshold and conditions operate as described.
• Whether logs are retained to explain probability settings and subsequent changes.