Claw machine proprietors who offer prizes that are not properly labeled are to be held accountable, the Ministry of Economic Affairs said on Tuesday.
The number of stores equipped with claw machines has increased dramatically this year to 3,353, from 920 in 2016, Ministry of Finance statistics showed.
An inspection of 26 stores by the Executive Yuan’s Consumer Protection Committee found that only three stores stocked prizes with labeling that conformed to regulations, committee Director-General Liu Ching-fang (劉清芳) said.
While all the stores met fire safety and structural integrity standards, seven had not registered with local authorities to offer arcade games, the inspection found.
Meanwhile, some parents have expressed concern that the machines encourage minors to place bets for prizes, Liu said, adding that some machines contain pornographic items as prizes.
The ministry, as the agency that oversees arcades, should clarify whether the machines are electronic merchandisers or arcade machines, which are subject to different regulations, the committee said, adding that the regulations governing arcades are also in need of an overhaul.
The ministry said it would by the end of the year establish a new, uniform set of rules after holding hearings to seek opinions from the public and sector associations.
The ministry’s Central Region Office said that stores with mislabeled prizes should remove the problematic items or risk a fine of between NT$20,000 and NT$120,000.
The stores would be subject to subsequent fines until they make the necessary improvements, it added.
Four of the 23 noncompliant stores have made corrections, while 19 others have pulled mislabeled or controversial products from the machines, the office said.
A legal interpretation published by the ministry has already differentiated between electronic merchandisers and arcade machines, committee officer Wang Chih-hung (王志宏) said.
Machines that guarantee a prize after a customer pays a set price — provided that the price matches the value of the prize — are considered merchandisers, while those that do not are arcade machines, Wang said, citing the interpretation.
However, an overhaul of regulations is necessary, because the rules only cover arcade machines, Wang added.
Arcade machines are not permitted within a certain distance from schools and owners of arcade machines must offer public liability insurance, ministry official Kang Ming-wei (康明瑋) said, citing the Electronic Game Arcade Business Regulation Act (電子遊戲場業管理條例).
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