eSports coming to the fore for policymakers in Europe | White & Case LLP International Law Firm, Global Law Practice
eSports coming to the fore for policymakers in Europe

eSports coming to the fore for policymakers in Europe

White & Case Technology Newsflash

ESports' First EU Parliamentary Discussion

"eSports in Europe: What Policy Response?" was the title of the first conference about competitive gaming's current regulation and sport status in the EU. On September 6, 2017, Members of the European Parliament, in particular the European Parliament's Sports Intergroup, met with representatives from the Electronic Sports League ("ESL")1, SK Gaming2 and the ESports Integrity Coalition ("ESIC")3. The goal of this conference was to provide an overview over the main actors in the industry and discuss the need for regulation in the eSports sector. eSports is a fast growing industry; the European market itself, which currently generates one third of the revenue worldwide, is expected to grow to a volume of $400 Mio in 2020.4 In other parts of the world, professional eSports players are as well-known and famous as popstars.

 

Self-Regulation: Common legal Framework not yet existent

However, unlike traditional sports, there is no pyramid of well-established international and national governing bodies to provide a legal framework for eSports. The World Esports Association5 ("WESA") is trying to set a global framework6, but is still in its infancy regarding its recognition as THE global eSports association. This is not surprising since eSports is a relatively young, commercially driven business with an increasing number of companies and stakeholders involved which are often strong competitors. Finding common ground in areas like "the laws of the game" and good governance is not easy, especially since the industry is very inhomogeneous and involves billion dollar companies as well as smaller independent developers. It remains to be seen whether policy makers will intervene as the industry develops. France, for example, has created a regulatory background that ranges from the definition of eSports to legal requirements for contracts with professional eSports players.7 However, France did not recognize eSports as sport, but rather created specific regulations for the eSports industry.

 

eSports and Statutory Law: The Situation in Germany

Unlike in other countries, the German Olympics Sports Confederation ("DOSB") refused to admit eSports since sport requires a "self-motoric performance" and playing eSports supposedly lacks such performance. The (non‑)admission as "sport" has a variety of legal consequences. For example, the recently enacted criminal regulations regarding betting fraud in Germany are explicitly directed to "sports." Section 265c (5) of the German Criminal Code refers to sport competitions as competitions that are organized by national or international sports organizations. Since eSports does not have a recognized national or international sports organization and the German Criminal Code for constitutional reasons does not allow for analogies, section 265c of the German Criminal Code would seem to not apply to betting fraud in eSports.8 However, it remains to be seen how criminal courts will treat a scenario where the eSports player commits a betting fraud when taking part in a professional eSports competition via the internet in a country where eSports is accepted as sport while physically remaining in Germany.

 

Outlook

With its growing economic importance, the eSports industry is rapidly becoming a major player in the entertainment sector. The establishment of new and the adaption of existing legal regimes needs to keep up with this process to ensure that eSports becomes a sustainable business in the long term. This may be challenging for the industry itself and its various stakeholders as well as policy makers, but the dynamic of the community and the lack of traditional persuasions may actually prove helpful.

 

1 The ESL is the world's largest eSports company and organizes competitions and tournaments world-wide, cf. https://www.eslgaming.com/ (last accessed September 13, 2017).
2 SK Gaming is a professional eSports team based in Germany.
3 The ESports Integrity Coalition is a not for profit members' association established in 2015 by key eSports stakeholders to deal with issues of common interest – in particular the threat that match manipulation and betting fraud and other integrity challenges pose to eSports, cf. http://www.esportsintegrity.com/ (last accessed September 11, 2017)
4 Cf. https://newzoo.com/insights/articles/esports-revenues-will-reach-696-million-in-2017/  (last accessed September 11, 2017)
5 The WESA is an eSports association founded in 2016 by the ESL and several major teams. Cf. www.wesa.gg  (last accessed September 15, 2017).
6 Cf. the draft for a "Code of Conduct and Compliance for Teams and Players" dated July 29, 2017, available at http://www.wesa.gg/wp-content/uploads/2017/04/WESA-Code-of-Conduct-Teams-and-Players.pdf  (last accessed September 15, 2017).
7 Cf. Article 101 et seq. French Numeric Law (LOI n° 2016-1321 du 7 octobre 2016 pour une République numérique (1)) available in French at https://www.legifrance.gouv.fr/affichTexte.do?cidTexte=JORFTEXT000033202746&dateTexte=2017091 5 (last accessed September 15, 2017.
8 See Bittmann/Nuzinger/Rübenstahl in BeckOK StGB, v. Heintschell-Heinegg, 35. Edition, §265c Rn. 51 and Rn. 51.1 et seq.

 

Mathias Bogusch, an associate at White & Case, assisted in the development of this publication.

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