The Australian Competition and Consumer Commission said it would be working on new guidelines to protect customers, after it looked at 340 app games in the Google Play and Apple App Store.
Fewer than 25% of the child-friendly game apps mentioned that real world money could be used to make purchases within the games.
Many of these payments are made by simply tapping on an image in the game, with the funds debited from existing iTunes or Google Play Accounts or linked credit cards.
The watchdog told reporters its sweep highlighted the potential for misleading and deceptive conduct in the promotion of apps as well as inadequate disclosure of key terms and conditions associated with using the apps.
“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. 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,” ACCC deputy chair Delia Rickard said.
The move follows a list of proposed principles from the UK released for discussion by its Office of Fair trading, which say consumers should be told upfront about any possible in-game costs or advertising, important terms should be prominently disclosed prior to download and an account holder, such as a parent, must give informed consent to payments before they are authorised.
The ACCC said it would be backing the local implementation of the proposed principles.
The consumer watchdog also said many of the games it reviewed did not provide access to the terms and conditions prior to downloading and playing the game, and that it would continue to investigate concerns about misleading conduct in relation to a number of specific apps, and could take enforcement action where contraventions of the Australian Consumer Law were identified.