Game on! The Brazilian Video Games industry – from big potential to possible legal concerns

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The Brazilian Video Games industry – from big potential to possible legal concerns

Like other parts of the world, Brazil is currently experiencing a culture revolution when it comes to video games. With new business models emerging, many in the industry are indeed questioning whether video games will become the new social networks, as places to interact and meet people.

Recently, we have seen massive investment in the global video games market, and more specifically in cloud-based games. With player numbers increasing rapidly, Brazil is also following this trend.

BGP Brasil estimates that more than 70% of Brazilians play some type of video game, with the vast majority using mobile phones, due to easier access to this type of device. The country already occupies fourth place in the global ranking of player numbers, behind only the most populous countries, such as the United States, China and India.

From traditional to new challenges

Brazil has the largest consumer market in Latin America and Brazilians are avid users of new audiovisual content. Hence, Brazil has massive appeal for investors in the video games industry.

In this scenario, questions arise on how best to protect creative work product in the context of a video game. Well, if we think in terms of intellectual property, the repertoire of protection is vast.

IP protection measures relevant to the video games industry may include trademarks, copyrights, designs, and in certain cases, patents. As a signatory party of the main international treaties related to intellectual property, Brazil’s legislation is aligned with those of most countries. One point of interest is that, under Brazilian law, the game’s software is protected by copyright, but methods and product features with steps executed by a computer program may also be patentable.

However, the potential issues are far from limited to considerations on intellectual property. Video game companies face new challenges related to how they interact with their users in a 100% digital environment, for instance, how to structure their “terms of use” or “codes of conduct” for compliance with local laws. For example, companies must consider the transparency requirements under the Brazilian Consumer Defense Code in obtaining agreement or consent from their users.

There are also critical issues to consider related to the privacy of personal data collected from the gamers, especially considering the recently enacted Brazilian Data Privacy Law (LGPD). This will involve, for example, producing adequate policies, practices, and appropriate data analysis systems.

Also, most gamers are now spending money on purchases within the games’ infrastructures, in so called “micro transactions.” Moreover, other industries are also using gaming related technologies to become more interactive with their customers.

Such practices can produce further legal issues under other areas of Brazilian law, such as contract, consumer, or tax law. It is also worth noting that, as a country from the civil law tradition, Brazil has a specific and detailed set of rules for each of these areas.

The state of play

There are already numerous video game related Bills pending before the Brazilian Congress dealing with topics such as regulation for children and adolescent users, the E-Sports market, games or programs with obscene or violent conduct, pornographic material, and the protection of IP in digital games. Moreover, there has been a proposal to amend the Brazilian Constitution, to institute tax immunity on video game consoles and games produced in Brazil.

As the legislative and law reform proposals are still pending, it is often the Brazilian courts that currently provide solutions to disputes involving game companies. In this scenario, securing specialized legal counsel is key.

In short, companies wishing to operate in the video games industry in Brazil should make sure that they receive high quality legal advice to avoid potential pitfalls across the diverse areas of Brazilian law that could impact their business.

At Daniel we are continuing to monitor the video games industry, new legislation, and decisions by the courts. Through our research institution, Daniel Lab, we stay in touch with the very latest developments. If you have any questions on this topic do not hesitate to contact us.

The Brazilian Video Games industry – from big potential to possible legal concerns

Like other parts of the world, Brazil is currently experiencing a culture revolution when it comes to video games. With new business models emerging, many in the industry are indeed questioning whether video games will become the new social networks, as places to interact and meet people.

Recently, we have seen massive investment in the global video games market, and more specifically in cloud-based games. With player numbers increasing rapidly, Brazil is also following this trend.

BGP Brasil estimates that more than 70% of Brazilians play some type of video game, with the vast majority using mobile phones, due to easier access to this type of device. The country already occupies fourth place in the global ranking of player numbers, behind only the most populous countries, such as the United States, China and India.

From traditional to new challenges

Brazil has the largest consumer market in Latin America and Brazilians are avid users of new audiovisual content. Hence, Brazil has massive appeal for investors in the video games industry.

In this scenario, questions arise on how best to protect creative work product in the context of a video game. Well, if we think in terms of intellectual property, the repertoire of protection is vast.

IP protection measures relevant to the video games industry may include trademarks, copyrights, designs, and in certain cases, patents. As a signatory party of the main international treaties related to intellectual property, Brazil’s legislation is aligned with those of most countries. One point of interest is that, under Brazilian law, the game’s software is protected by copyright, but methods and product features with steps executed by a computer program may also be patentable.

IP protection measures relevant to the video games industry may include trademarks, copyrights, designs, and in certain cases, patents. As a signatory party of the main international treaties related to intellectual property, Brazil’s legislation is aligned with those of most countries. One point of interest is that, under Brazilian law, the game’s software is protected by copyright, but methods and product features with steps executed by a computer program may also be patentable.

However, the potential issues are far from limited to considerations on intellectual property. Video game companies face new challenges related to how they interact with their users in a 100% digital environment, for instance, how to structure their “terms of use” or “codes of conduct” for compliance with local laws. For example, companies must consider the transparency requirements under the Brazilian Consumer Defense Code in obtaining agreement or consent from their users.

There are also critical issues to consider related to the privacy of personal data collected from the gamers, especially considering the recently enacted Brazilian Data Privacy Law (LGPD). This will involve, for example, producing adequate policies, practices, and appropriate data analysis systems.

Also, most gamers are now spending money on purchases within the games’ infrastructures, in so called “micro transactions.” Moreover, other industries are also using gaming related technologies to become more interactive with their customers.

Such practices can produce further legal issues under other areas of Brazilian law, such as contract, consumer, or tax law. It is also worth noting that, as a country from the civil law tradition, Brazil has a specific and detailed set of rules for each of these areas.

The state of play

There are already numerous video game related Bills pending before the Brazilian Congress dealing with topics such as regulation for children and adolescent users, the E-Sports market, games or programs with obscene or violent conduct, pornographic material, and the protection of IP in digital games. Moreover, there has been a proposal to amend the Brazilian Constitution, to institute tax immunity on video game consoles and games produced in Brazil.

As the legislative and law reform proposals are still pending, it is often the Brazilian courts that currently provide solutions to disputes involving game companies. In this scenario, securing specialized legal counsel is key.

In short, companies wishing to operate in the video games industry in Brazil should make sure that they receive high quality legal advice to avoid potential pitfalls across the diverse areas of Brazilian law that could impact their business.

At Daniel we are continuing to monitor the video games industry, new legislation, and decisions by the courts. Through our research institution, Daniel Lab, we stay in touch with the very latest developments. If you have any questions on this topic do not hesitate to contact us.

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