legal relations in the gaming industry

Gaming industry, i.e. the industry of video games (PC games, mobile games, console games and browser/social network games) is one of the fastest growing industries, whose value reached the number of 196 billion dollars in 2022.

Legal service is required from the early stages of concept and pre-production through the stage of production and realization, including documenting the investor’s investment and regulation of licenses, intellectual property, and all other rights and obligations of each of the participants to be contracted.

The contracts governing relations in the gaming industry are:

• Development Contract

• Investment Contract

• Employment Contract

• Nondisclosure Agreement - NDA

• Distribution Agreement

• Licence Agreement

• End user Licence Agreement - EULAs

• Terms of Service - TOS

Participants in the gaming industry are: developers, publishers, distributors, traders, customers, and end users of the product (players).

Developers are people specialized in the field of software development, i.e. in the video game industry, people who create a video game and all the segments it consists of - image, sound, design and other components that a certain game will require.

Publishers are the participants who make sure that the game is placed on the market. Publishers are most often the companies that work with a large number of developers, conduct market research and analyse consumer needs in order to create a game portfolio with the highest possible chance of success.

Distributors allow games to be downloaded in a traditional physical way and/or through digital distribution platforms. Merely two decades ago, there was only physical distribution, and games were sold in physical form, which was the only way video games were sold. With the advent of the Internet, video games began to be sold online, and today that sales channel takes over the majority of sales.

Mutual interaction and connection between developers, distributors and publishers is very common and requires complex legal monitoring of these relationships.

leG islation in the republic of c roatia

The 2018 Law on Audiovisual Activities introduced the category of video games for the first time. The production of video games is defined as an audiovisual activity, and is classified in the same audiovisual activity as the production of other multimedia content, series and films, and the provision of on-demand audiovisual services such as the Internet and other media.

This Act also regulates video games as audiovisual works, which created a legal framework for the further development of one of the most propulsive segments of audiovisual industry.

Along with some benefits, the legislator stipulated obligations for the developers as well. There is an obligation to emphasize the categorization of each work before its publication, considering the age of the users for whom it is intended. The law prohibits the distribution, sale and rental of video games to minors if the category of games is not appropriate for their age. It is also prohibited to publicly display and advertise games that are not suitable for minors.

Everyone involved in the production of games must be registered in the register of the Croatian Audiovisual Center (HAVC), which is maintained digitally and whose form is prescribed by the director of the Centre.

leGal support for GaminG and esports

Some gaming start-ups do not think they need legal support. This often leads to an imbalance in the position of investors and startups, which, despite excellent ideas, do not achieve the desired financial results because of that.

That is why start-ups have the greatest need to be familiar with their legal rights and everything they should do to achieve success in this fastgrowing industry.

We should also point out eSports as a new fast-growing entertainment industry with a significant population of fans in North America, Asia (South Korea and China) and the European Union (Germany and Great Britain).

From a legal point of view, eSports has brought some unique professional needs to the extent that the first law firm dedicated entirely to eSports was opened in early 2017.

The growing field of eSports law covers everything from copyright and intellectual property, contract law, mergers, acquisitions, employment, betting regulation and international legal issues.