Gaming industry and esports

Our firm has a highly specialised team of experienced lawyers dealing with gaming. We work for both local and international companies and address all matters from obtaining gambling licences for major international entities to the activities of individuals – game participants. Due to the growth of this form of entertainment, the majority of our work is focused on online games. We have many years of experience in administrative proceedings with regulatory authorities and in representing clients in litigation matters.

REGULATION OF GAMES OF CHANCE

Games of chance are a socially acceptable and very popular area in our countries, however, strictly regulated and supervised by several administrative bodies (the Ministry of Finance, the Customs Administration Authority, trade licensing authorities, the Council for Radio and Television Broadcasting and others, in the Slovak Republic especially the Office for the Regulation of Games of Chance). In 2017 in the Czech Republic and in 2019 in the Slovak Republic, the legislation was liberalised, both in the sense of opening up to foreign providers of games of chance and in the sense of technological neutrality. This allowed not only expanding the range of operators who can obtain a licence, but also the range of games they can offer. However, the new laws have raised many questions regarding interpretation, and the attitude of the supervisory authorities to the sub-topics of this very specific regulation is therefore crucial for the practical functioning of the sector.

A separate issue is then the taxation of games of chance, which is governed by other specific legislation. Last but not least, important for the practice is the interface between games of chance and consumer competitions, which are very popular in our country and which are already viewed, in compliance with EU law, as a commercial practice subject to general consumer protection rules.

ESPORTS

The area of esports is also related to games of chance. Apart from the basic tension in the question of what is and what is not chance, as not the only but fundamental defining feature distinguishing games of chance subject to regulation from other games (skill games), this is an area that is not yet specifically regulated but is developing all the more dynamically. In this area, therefore, entertainment law issues such as marketing, sponsorship and other contracts, advertising and the protection of intellectual property rights are addressed alongside the rules of the games and tournaments themselves.

The Act on Games of Chance provides for very high fines if it is breached. At the same time, the supervisory authorities – on their own initiative or in response to complaints – monitor the market very closely and actively, test games through user experience, and initiate proceedings for even minor offences. Not only domestic operators, but also online operators from all over the world must be on alert if they do not actively block participants from our countries. Indeed, the supervisory authorities apply a very strict approach to assessing the territorial scope of regulation and do not hesitate to fine foreign operators with a purely virtual presence and block their web addresses or bank accounts for operating unauthorised games of chance.

In the long term, we have primarily been addressing the following areas:

• Comprehensive legal support for the operators of games of chance and authorised persons (testing houses)
• Legal analysis of gaming concepts and follow-up communication with the competent regulatory authorities
• Representing clients in obtaining licences to operate games of chance
• Drafting the legal documents necessary for the operation of (online) games of chance and other games (game plan, terms of use, privacy policy, cookies policy)
• Representing the operators of games of chance in M&A transactions
• Gaming-related tax advice, including gaming tax issues
• Providing support to advertisers to ensure the promotion of games of chance and other games in accordance with the law
• Setting up bonus schemes for game participants
• Representing clients in administrative and court proceedings, in particular:
  • Representing foreign clients before the Ministry of Finance in proceedings concerning the unauthorised operation of online games of chance, or before the Office for Regulation of Games of Chance in proceedings concerning the provision of prohibited offers and the related blocking of web addresses and bank accounts
  • Representing operators before the Ministry of Finance and the Customs Administration Authority in proceedings concerning violations of the Act on Games of Chance or the conditions for the operation of games of chance stipulated in the basic licence, and in subsequent court proceedings
• Representing operators or game participants in relation to the prohibition of accepting bets or the prohibition of betting
• Comprehensive advice on changes to public regulation and monitoring of the gambling market
• Assessing the relationship between games of chance and other games, including mainly esports
• Legal revisions of consumer and other marketing competitions
• Advising on the European and international aspects of gaming law
• Advising payment service providers who provide their services to the operators of games of chance