Microsoft has purchased the developer behind an upcoming and much-anticipated game that was refused classifiction in Australia, although it remains unclear if there's anything the multinational company could do to reverse the game's fortunes down under.

Compulsion Games is a Montreal-based 40-person team, which Microsoft has acquired as part of a plan to beef up its stable of studios making games for Xbox. The studio's next release, which was originally shown off in 2015, is a somewhat Orwellian dystopia called We Happy Few. It's due to be released on August 10 for Xbox, PC and PlayStation 4, but not in Australia.

The game is set in a British town in the 1960s. Citizens there take a drug called Joy, which helps them forget a terrible event that's occured and makes them believe their crumbling society is all sugar and rainbows, and it's this aspect of the game that saw it run afoul of the Australian Classification Board's guidelines.

Clause 1(a) of the the National Classification Code states in part that games should not be classified if they deal with issues of drug use and addiction "in such a way that they offend against the standards of morality, decency and propriety generally accepted by reasonable adults".