On May 7, 2020, the Korean government announced the Comprehensive Plan for the Promotion of the Game Industry (the “Comprehensive Plan”), which was developed together with relevant government departments. The Comprehensive Plan is established in accordance with Article 3 of the Game Industry Promotion Act (the “Game Industry Act”) and Article 6 of the Act on Promotion of e-Sports, and is announced every five years. Please find below the key details of the newly announced Comprehensive Plan.
1. Improving regulation under the Game Industry Act
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Improving the reporting system for content revision: the current Game Industry Act obligates game business operators to report any revisions to the content of their games to the Game Rating and Administration Committee (the “GRAC”), and requires the operators to roll the games back to their original state upon a “rating re-classification” decision by the GRAC. These obligations have posed a heavy burden on game business operators. According to the Comprehensive Plan, the following measures are being discussed: (i) exempt game business operators from reporting minor revisions to games that do not affect rating classification (e.g., technical enhancements and improvements, addition of characters without change in age requirements, game balance adjustments, bug corrections, operating system changes and updates), and (ii) allow online and mobile game business operators to choose to report content revisions in advance (to avoid inconvenience arising from the rollback).
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Preventing repeated reviews: the current rating classification review system obligates game business operators to receive a separate rating classification for the same-content games if the games are provided on different operating platforms. However, discussions are underway to introduce a content-focused rating classification review system where game products with the same content are allowed to acquire one rating classification to be distributed on all platforms without repeated reviews.
2. Improving the system to protect the rights and interests of game users
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Improving identity authentication: the current Game Industry Act obligates “entities that provide game services to the public through information and communications networks” to conduct identity authentication and check users’ names and ages. However, for various reasons such as security, identity authentication has mostly been conducted on cell phones, making it difficult for minors and foreigners to sign up for games. Accordingly, reviews are underway to abolish identity authentication for G-rated games, assuming that users failing to complete identity authentication are under the age of 16, subject to mandatory shutdowns (a system that restricts users under the age of 16 from playing online games from 24:00 to 6:00).
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Designating a domestic agent: similarly with the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc., a domestic agent designation system is being discussed for overseas business operators that have no addresses or places of business in Korea, in order to strengthen user protection and address alleged reverse discrimination against domestic companies compared to overseas companies.
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Improving game advertisement systems: although the current Game Industry Act specifies a limited list of advertisements that are prohibited (e.g., advertisements that are not appropriate for the rating classification granted), advertisements have been simply regulated without a clear legal basis if they are deemed to be harmful to minors. Therefore, discussions are being held to prepare a legal basis for limiting game-related advertisements that also impede proper use of games.
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Legislation related to information disclosure of random items: although the probability of winning particular prizes in random items is currently disclosed on a voluntary basis within the industry, there is discussion to amend the Game Industry Act to include definitions related to random items and obligate game business operators to disclose the types and chances of particular prizes that can be won in random items. In fact, the Korea Fair Trade Commission (the “KFTC”) revised its Public Notification on Provision of Information of Goods, Etc. in Electronic Commerce Transactions (the “Public Notification”), which will take effect in the second half of this year, to make such disclosures mandatory, but if random item-related provisions are defined and governed under the Game Industry Act, the revised Game Industry Act will take precedent over the Public Notification.
3. Fostering the e-sports industry
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Introducing a standard agreement between e-sports players and e-sports teams: discussions are being held to develop (with relevant government authorities including the KFTC) and distribute a standard agreement (for minors, a separate agreement with special terms) to protect e-sports players.
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Expanding the player registration system: to ensure the objective management of information on players, including their match/game records, there is discussion on implementing a player registration system for all players of official e-sports under the Korea e-Sports Association (the “KeSPA”).
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Systematic protection for e-sports players (including education): discussions are underway to (i) ensure systematic protection for e-sports players by providing them with education and legal and accounting advice, and (ii) protect the rights and interests of e-sports players by establishing the e-Sports Fair Practice Commission (tentatively named), an expert organization that investigates e-sports players’ complaints, hardships and requests for mediation, within the KeSPA.
With regard to the foregoing, at the “Forum on Comprehensive Amendment to the Game Industry Act” held in February, the Ministry of Culture, Sports and Tourism (the “MCST”) announced a proposed amendment which includes the above “improving reporting system for content revision,” “designating domestic agents,” “improving game advertisement systems,” and “legislation related to information disclosure of random items” objectives. According to the Comprehensive Plan, it seems that the MCST plans to amend the Game Industry Act in the second half of this year by thoroughly considering the opinions from the relevant industry.
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