By Arpita Dutta, Legal Consultant, Louis International Patent Office
Online video games are inseparable from the eSports in terms of growth factors. In eSports, the payers intend to cherish their career as professional or amateur video game players and actively participate in the tournaments. Therefore, a high level of recognition in the multi-player videogames is indeed essential for eSports industry. Looking into the growth of the online game players in India, the industry predicts a positive shift. Many industries have been affected due to COVID19. However, the lockdown became a thriving factor for the eSports industry. Housebound people are driving to accept a new model of engagement through eSports. And around 35% higher usage has been noticed in multi-player modes in online gaming. Many eSports platforms have reported double-digit growth in the user base during the lockdown, for example, Paytm First Games has reported an almost 200% increase. This new addition to the sports industry is well greeted since 2019. We can even say that, this is a ‘paradigm shift’ in the Indian sports industry.
India is a lucrative market for FDI with 75% of its population under the age of 45 and the second-largest online market. Investors need to adhere to all the relevant regulations in India during the collaboration. Considering the spectrum of the consequences, several laws indirectly regulate this complex industry.
- Intellectual Property:
Intellectual property is one of the most important concerns in the eSports world. It is crucial to receive proper authorization or license from the appropriate personals. Make sure that your intellect is properly shield with IP protection in an adequate form of IP such as trademark, copyright, patent, trade secret, etc. Otherwise, IP infringement can cost a fortune.
- Gambling Act :
The Public Gambling Act is the most influential law in the eSports industry in India. Since the Act is a State Subject, therefore, the regulations may vary from state to state. However, Indian Foreign Direct Investment (FDI) and Foreign Exchange Management Act (FEMA) prohibit any kind of investment or collaboration of foreigners in the lottery, gambling, and or betting field, even any form of technology collaboration is also prohibited. Therefore, it would be wise to understand your matter of investment. The Information Technology Act further regulates the electronic transmission of gambling information too.
- Other Laws:
To maintain the morality, decency, and to avoid provocative contents, this industry is regulated by many other laws such as The Code of Advertising Standards Council of India to control the content of the advertisement in the eSports activities, the Information Technology Rules controls the transmission of information, the Indecent Representation of Women (Prohibition) Act, etc.
Apart from the legality, negotiating power has become the foremost concern in this industry. A careful review of the content of the contract becomes essential for M&A, investment, and collaboration. Even sometimes, terms in the player’s agreement also brings disputes is the contact law and effects the employment. Therefore, consider drafting contracts by professional corporate lawyers would be a smart choice.
With more recognition, countries might strive to enact specific laws to regulate the industry. With these evolving changes into the Laws our society would demand proficient eSports lawyers soon.
Taiwan is also having great eSports recognition, so walking both countries hand in hand would be a win-win scenario for the Taiwanese and Indian collaborators.