Great Britain's Office of Fair Trading has published a set of principles for online and "freemium" games (desktop and mobile), established to protect children from games that unconsciously manipulate them into making in-app purchases, and to ensure the games don't breach England's consumer protection law. The OFT has given game producers a deadline of April 1 to implement the necessary changes to their current and future products.
The OFT principles don't seek to ban in-app purchases, but state that consumers should be told upfront about costs associated with a game or about in-game advertising, and any important information such as whether their personal data is to be shared with other parties for marketing purposes. The principles also make clear that in-game payments are not authorised, and should not be taken, unless the payment account holder, such as a parent, has given his or her express, informed consent.
The investigation leading to the formation of these principles was launched in April 2013, out of concern that children and their parents could be "subjected to unfair pressure to purchase items they thought were free, but which can actually run up substantial costs." The OFT investigation surveyed game creators and looked into whether their games include "direct exhortations" to children - "a strong encouragement to make a purchase, or to do something that will necessitate making a purchase, or to persuade adults to make a purchase for them." This is forbidden under Britain law.
Cases of unsupervised children spending money from their parents' bank accounts on in-game items, with no ability to understand they are dealing with real cash, are a notorious subject in the world of mobile and online games. Recently, Apple agreed to refund a massive $32.5 million dollars to settle complaints from parents of young kids. One such child spent as much as $2385 (£1,500) in a mere two hours of playing Tap Pet Hotel, and this isn't an isolated incident.
The eight principles are detailed in a document which is accessible in PDF form at this location. It gives many examples of proper and improper practices of implementing in-app purchases, which are worth having a look at.