Deputies want to allow organizers of eSports competitions to hold tournaments without licensing agreements with copyright holders
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The State Duma has prepared an initiative that will allow organizers of eSports competitions to hold tournaments without concluding licensing agreements with copyright holders. Funds for the use of games will be sent to a new public company (PPC), which will store them for three years. If the copyright holders do not claim the money, it will be sent to support Russian developers or the Computer Sports Federation. Thus, the deputies intend to reduce the risks for Russian organizers of eSports competitions. First of all, we are talking about the “Games of the Future” – their organizers have not yet been able to reach an agreement with foreign rights holders.
On November 16, the State Duma Committee on Physical Education and Sports held a meeting of the group “Development of High-Tech Sports in the Russian Federation.” Changes in legislation were discussed that would make it possible not to pay license fees to copyright holders of software used to organize e-sports competitions. Among the guests were representatives of the Ministry of Digital Development, the Computer Sports Federation, the Unified Gambling Regulator (URAI), and the Agency for the Development of Computer Sports and Other Sports (organizers of the Games of the Future).
Judging by the materials of the meeting (available to Kommersant), the deputies prepared a package of amendments. The first initiative will supplement the Federal Law “On Physical Culture and Sports” with the definition of “innovative sports” – that is, combining “physical activity and digital technologies.” They involve the use of computer technology, electronics, software and complex objects, “the reproduction of which is aimed at creating an environment for practicing such sports.”
The second draft provides for the addition of Art. 1274.1 of the Civil Code and introduces a regime for the free use of software in Russia, which acts as equipment for “innovative sports.” The copyright holder will be able to claim royalties for the use of products if they are used in competitions that meet certain conditions. This includes the availability of a prize fund, ticket sales, broadcasting and the organization of bets in bookmakers.
But the copyright holder will be able to receive payments only through a new structure – the PPK “Unified Aggregator of Rewards for the Free Use of Works.”
The procedure for its work is regulated by a separate bill. PPK will collect funds and then distribute them to copyright holders. If the copyright holder has not claimed the money within three years, says Amir Khamitov, deputy chairman of the State Duma Commission on Physical Culture and Sports (a deputy from the New People party), PPK “can distribute it for various purposes – send it to Russian developers or the Computer Sports Federation.”
The explanatory note explains the need for the mechanism by the fact that under the conditions of sanctions, the problem of organizing competitions using video games of copyright holders from unfriendly jurisdictions is becoming more acute.
They “ignore requests from Russian organizations to conclude licensing agreements on the use of works for sports purposes” or refuse to conclude them. Mr. Khamitov added that the bills are planned to be submitted to the State Duma for consideration at the current or early next session. The Ministry of Digital Development did not participate in the meeting and is not familiar with the initiatives. The Ministry of Sports and ERAI did not respond to requests.
The next major tournament, in which participants will compete in disciplines that fall under the definition of “innovative sports” (phygital), will be the “Games of the Future” in February 2024 in Kazan. Among the video games for which the competition will be held, the project website mentions CS.GO, DOTA 2 (copyright holder is the American Valve), Warface (owned by Astrum), etc.
As Vsevolod Rozhkov, a sports law lawyer and head of the Game-in-Law company, explained to Kommersant, interaction between tournament organizers and copyright holders is usually built in two ways: by complying with the terms of an open license or by concluding a direct agreement. Tournaments under an open license assume that the organizer complies with all the terms of the offer, which may contain restrictions, for example, on the size of the prize fund, broadcasting, ticket sales, etc.: “If the tournament organizer understands that his event will not take place in the future to comply with the requirements of the license, he must directly contact the copyright holder and enter into an agreement with him.”
The lawyer clarifies that contracts can be either compensated or not involve the payment of remuneration to the copyright holder. “Violation of the terms of the open license may lead to a requirement to ban the use of the game and litigation with subsequent sanctions against the organizer,” he adds.
A Kommersant source in the esports industry says that the organizers of the Games of the Future are now facing such problems, since they have not yet been able to conclude agreements with a number of foreign rights holders.
The press service of the “Games of the Future” told Kommersant only that they were “negotiating with key publishers.”
Managing partner of Semenov & Pevzner Roman Lukyanov believes that Russian e-sportsmen risk suffering from the implementation of the mechanism, who may have limited access to competitions abroad. Also, the lawyer says, since the law does not have a clear definition of a video game (it is classified as software, audiovisual works, multimedia products, etc.), the amendments could “create the basis for the use of a wide range of objects without the permission of the copyright holder.”
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