The European Commission fines valve and 5 publishers 7.8 million euros for geo-blocking steam games.

[AndreiArgeanu]

Summary

 

After a investigation the European Commission fined various publisher and valve a total of 7.8 million euros for geo-blocking games and/or games keys. The fine was reduced for the 5 publishers by 10 to 15% since they cooperated with the Commission, Valve has not cooperated with the commission therefore got a full 1 624 000 euros fine. Valve claims they have cooperated during the 7 year investigation.

 

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UPDATE: Valve has issued Eurogamer with a statement disputing the European Commission's claims and vowing to appeal.

A Valve spokesperson told Eurogamer: "During the seven year investigation Valve has cooperated fully, providing all requested evidence and information to the Commission. We disagree with these findings, and plan to appeal the decision."

We've asked the European Commission for a response.

ORIGINAL STORY: The European Commission has fined Valve and five publishers €7.8m for geo-blocking PC games.

Valve, Bandai Namco, Capcom, Focus Home, Koch Media and ZeniMax (Bethesda) were all fined for breaching EU antitrust rules.

The European Commission said the companies restricted cross-border sales of certain PC games on the basis of the geographical location of users within the European Economic Area (EEA), violating EU antitrust rules.

The Commission said Valve refused to cooperate, and so slapped the US company with a heavier fine (€1.624m) than they would have otherwise. We've asked Valve for comment.

The Commission published a useful graphic, below, explaining what went on:

 

My thoughts

  It's interesting to say the least that the EU is getting involved with this kind of stuff, I didn't even know that geo-blocking was 'anti-trust' or anything. That could mean that there may be no more region locked steam keys. I'm waiting to see whether Valve will actually change something or just try to appeal. Also Zenimax is basically Bethesda, idSoftware and a few other studios. I'm surprised that even after reductions ZeniMax got fined more than Valve.

Sources

 EuroGamer

 European Commission

 

[Master Disaster]

37 minutes ago, AndreiArgeanu said:

My thoughts

 

  It's interesting to say the least that the EU is getting involved with this kind of stuff, I didn't even know that geo-blocking was 'anti-trust' or anything. That could mean that there may be no more region locked steam keys. I'm waiting to see whether Valve will actually change something or just try to appeal. Also Zenimax is basically Bethesda, idSoftware and a few other studios.

 

Sources

 EuroGamer

 

The EU has much stricter rules than the US, you cannot restrict bloc consumers from buying items from other countries also in the bloc.

 

There's ZERO chance Valve will just do away with region locking entirely even if they lose any appeal they might launch, the most likely outcome is they'll disable it for consumers who are resident in an affected country.

 

This is a classic case of the politicians not understand the thing they're legislating, alls that will happen is the cheap games available in EU countries with less wealth will disappear overnight.

 

Zenimax doesn't exist any more (at least as a developer), Microsoft bought them out last year. I'm not sure if Zenimax Publishing was included in that deal or just the game dev studios?

[rcmaehl]

Oh, this only affects the EU, not the UK as well. Forgot they weren't the same anymore.

[Drama Lama]

6 minutes ago, Master Disaster said:

The EU has much stricter rules than the US, you cannot restrict bloc consumers from buying items from other countries also in the bloc.

Yup

you can't redirect customers to the local site. You can ask them but not block

I guess this will only affect the EU so Valve will allow people in the netherlands to buy a bulgarian Steam Game

[AndreiArgeanu]

43 minutes ago, Master Disaster said:

Zenimax doesn't exist any more (at least as a developer), Microsoft bought them out last year. I'm not sure if Zenimax Publishing was included in that deal or just the game dev studios?

ZeniMax looks to be alive and well (for now). Microsoft did buy ZeniMax and all it's subsidiaries but hasn't shut it down yet. And ZeniMax was never a studio/developing company, just a parent company.

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[JZStudios]

How is this possible? Good Guy Valve and Lord Gaben are physically incapable of doing shitty business practices. Ask anyone!

No we don't have Stockholm syndrome!

[suicidalfranco]

now see games prices rise in poorer EU countries to the same level as the rich EU countries following this.

60€ price tag in the entire block.

[jagdtigger]

Please do the same with every single streaming platform for blocking VPN and other shenanigans like locking 4k to specific HW for no good reason (DRM is not a good reason before someone jumps on it)......

[Mark Kaine]

50 minutes ago, Drama Lama said:

Yup

you can't redirect customers to the local site. You can ask them but not block

I guess this will only affect the EU so Valve will allow people in the netherlands to buy a bulgarian Steam Game

I'm pretty sure they won't, they'll just pay the fine lol.

 

VALVE loves region blocking and a million here and there is literally peanuts to them. 

[AndreiArgeanu]

1 minute ago, Mark Kaine said:

'm pretty sure they won't, they'll just pay the fine lol.

 

VALVE loves region blocking and a million here and there is literally peanuts to them. 

I mean they want to appeal against the fine. And if they don't change they'll get fined again and potentially more money.

[Mark Kaine]

1 minute ago, AndreiArgeanu said:

I mean they want to appeal against the fine. And if they don't change they'll get fined again and potentially more money.

One can only hope! 

 

I'm still waiting for being allowed to sell my steam games btw, which they're also bound to allow by law, but they appealed that too... for who knows how long already. 

[Arika]

Based on figures from 2017, this fine was 0.04% of their yearly sales revenue. 

 

Given the current state of the world they would be making waaaaay more money now, it's like the EU was just following them around scraping up change that fell out of their pockets. 

[poochyena]

31 minutes ago, Arika S said:

Based on figures from 2017, this fine was 0.04% of their yearly sales revenue. 

 

Given the current state of the world they would be making waaaaay more money now, it's like the EU was just following them around scraping up change that fell out of their pockets. 

revenue alone means absolutely nothing what so every about the financial health of a company.

 

4 hours ago, suicidalfranco said:

now see games prices rise in poorer EU countries to the same level as the rich EU countries following this.

60€ price tag in the entire block.

good. Region blocking is awful

[Guest]

They'll not receive a dime. Valve will take it to court (in the US, being based in the US...) and if the commission actually wins, it won't likely be till years from now. 

 

A fine, haha that made me laugh. You know how many unpaid parking tickets are in the US? We don't pay fines here

[Doobeedoo]

I remember this being a thing before about this. Oh well we'll see what happens. 

I'm still paying €60 for AAA games in my 3. world country though.

[Delicieuxz]

Publishers might have brought this on themselves by engaging in geo-blocking.

 

Region-locking keys, preventing people from one region from buying and activating keys from another, makes sense - though, it can be sidestepped with VPNs.

 

But geo-blocking games, preventing people who bought and activated them in their original region from playing them while they're in another, is an awful practice that should be outlawed everywhere because it is effectively stealing people's games and obstructing their property rights over them, which includes the right to play them regardless of where they are.

 

1 hour ago, ShrimpBrime said:

They'll not receive a dime. Valve will take it to court (in the US, being based in the US...) and if the commission actually wins, it won't likely be till years from now. 

 

A fine, haha that made me laugh. You know how many unpaid parking tickets are in the US? We don't pay fines here

Valve would have to appeal in an EU court, since the decision is made by the EU regarding EU law applied within the EU regarding Valve's business within the EU. Valve will have no choice but to submit to the decision of the EU if Valve wish to continue business in the EU.

 

You can get away with not paying a parking ticket issued by a private company on their property. But if you were to be caught parking on their property again without paying, they might tow and impound your car until you paid. You can avoid paying the ticket by avoiding the property of the company you owe a fine to. And even if you don't pay a private company, they'll eventually hand your fee to a collection agency, which will harm your credit rating.

 

If the ticket is issued by a city or state, the fine will likely keep increasing and you can have your car impounded for not paying, and can also lose your driver's license. An arrest warrant might also be issued for you.

 

In short, you can avoid paying to the extent that the reach of the company or entity you owe is limited.

 

But the EU government's reach encompasses the entire EU and a business can't avoid the EU government's decisions so long as it continues operating within the EU. If Valve ignored the EU's decision, Valve's business in the EU would be heavily penalized and its assets could be seized, and Valve could be prohibited from operating in the EU, which would mean the loss of access to the 2nd or 3rd-largest economy in the world.

[Arika]

1 hour ago, poochyena said:

revenue alone means absolutely nothing what so every about the financial health of a company.

It means exactly as much as this fine

[poochyena]

30 minutes ago, Arika S said:

It means exactly as much as this fine

This is nearly 10 million dollars, thats a huge fine for a company the size of Valve.

edit;

to put this into perspective, with 360 employees, and assuming a starting salary of ~$80,000, they could have increased their workforce by 35% with 10 million dollars.

[TetraSky]

6 hours ago, suicidalfranco said:

now see games prices rise in poorer EU countries to the same level as the rich EU countries following this.

60€ price tag in the entire block.

Pretty much this.

If games cannot be geoblocked, it just means games will no longer be "affordable" in places where the living wage is much lower than elsewhere. Otherwise you'll have people buying games in random poor third world country that cost like 1/3 the price it would be in any other first world country and reselling the keys.

[Guest]

1 hour ago, Delicieuxz said:

Publishers might have brought this on themselves by engaging in geo-blocking.

 

Region-locking keys, preventing people from one region from buying and activating keys from another, makes sense - though, it can be sidestepped with VPNs.

 

But geo-blocking games, preventing people who bought and activated them in their original region from playing them while they're in another, is an awful practice that should be outlawed everywhere because it is effectively stealing people's games and obstructing their property rights over them, which includes the right to play them regardless of where they are.

 

Valve would have to appeal in an EU court, since the decision is made by the EU regarding EU law applied within the EU regarding Valve's business within the EU. Valve will have no choice but to submit to the decision of the EU if Valve wish to continue business in the EU.

 

You can get away with not paying a parking ticket issued by a private company on their property. But if you were to be caught parking on their property again without paying, they might tow and impound your car until you paid. You can avoid paying the ticket by avoiding the property of the company you owe a fine to. And even if you don't pay a private company, they'll eventually hand your fee to a collection agency, which will harm your credit rating.

 

If the ticket is issued by a city or state, the fine will likely keep increasing and you can have your car impounded for not paying, and can also lose your driver's license. An arrest warrant might also be issued for you.

 

In short, you can avoid paying to the extent that the reach of the company or entity you owe is limited.

 

But the EU government's reach encompasses the entire EU and a business can't avoid the EU government's decisions so long as it continues operating within the EU. If Valve ignored the EU's decision, Valve's business in the EU would be heavily penalized and its assets could be seized, and Valve could be prohibited from operating in the EU, which would mean the loss of access to the 2nd or 3rd-largest economy in the world.

Valve doesn't have to appeal in any EU court. They don't have to give the EU the graces of using any of their software for the sales of any games. It's Valve's company. Just like any company in the US has the US rights to sell and not sell anything anywhere at any time they feel they wish or wish not to. 

 

It would be like me trying to fine you. For what? You didn't want to sell me a game key. Oh no. 

 

You owe me 10 million US dollars because you won't let me purchase a game key.

 

And no, I've always had my car license and at best the city sent the parking tickets to collections, which, nobody pays them either lol.

[Arika]

42 minutes ago, poochyena said:

This is nearly 10 million dollars, thats a huge fine for a company the size of Valve.

edit;

to put this into perspective, with 360 employees, and assuming a starting salary of ~$80,000, they could have increased their workforce by 35% with 10 million dollars.

 

Valve themselves was only fined 1.6mil eur. Which is 2mil usd roughly.

 

The 7.6 was the total fines issues between valve and all 5 publishers.

[Brooksie359]

6 hours ago, AndreiArgeanu said:

I mean they want to appeal against the fine. And if they don't change they'll get fined again and potentially more money.

It would probably still be worth it unless the fine was significantly larger than what it currently is. The fact that the fine is only in the millions makes this fine a joke. Its the equivalent of getting a 5 dollar speeding ticket. 

[Mark Kaine]

2 hours ago, ShrimpBrime said:

They'll not receive a dime. Valve will take it to court (in the US, being based in the US...) and if the commission actually wins, it won't likely be till years from now. 

 

A fine, haha that made me laugh. You know how many unpaid parking tickets are in the US? We don't pay fines here

but that's not how it works, this is a European Court they'll be appealing before that court... 

 

 

The other option is to cease operating in EU. Which I'd honestly prefer I had it with their anti consumer bs and region locking... 

 

 

[poochyena]

30 minutes ago, Arika S said:

 

Valve themselves was only fined 1.6mil eur. Which is 2mil usd roughly.

 

The 7.6 was the total fines issues between valve and all 5 publishers.

This thread title needs to be updated

[Delicieuxz]

1 hour ago, ShrimpBrime said:

Valve doesn't have to appeal in any EU court. They don't have to give the EU the graces of using any of their software for the sales of any games. It's Valve's company.

I'm not sure of what "They don't have to give the EU the graces of using any of their software for the sales of any games" means, but a business has to obey the laws of the countries in which they operate, otherwise they won't be allowed to operate there. And so, every transaction Valve makes within the EU is subject to EU law. So are Valve's servers and any assets Valve has in the EU. So are any funds of Valve's processed and kept in the EU.

 

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Just like any company in the US has the US rights to sell and not sell anything anywhere at any time they feel they wish or wish not to.

A company has the right to sell in a place, subject to the law of the location in which they are seeking to conduct their business. Valve's options are to comply with EU law, or cease operating within the EU. Valve wants to sell in the EU because Valve generates hundreds of millions, if not billions of dollars in revenue each year by doing so.

 

So, Valve can ignore an EU decision imposed on their business, but only by ceasing their business operations in the EU, which Valve doesn't want to do.

 

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It would be like me trying to fine you. For what? You didn't want to sell me a game key. Oh no. 

 

You owe me 10 million US dollars because you won't let me purchase a game key.

It would only be like that if I was conducting business on your property, selling to all the other people on your property, using your banking institutions to process payments and your servers to host my services. And also if you were the ultimate ruler for everything that happens on your property (meaning there's no higher government) with the power to enforce your decisions.

 

If I failed to comply with your decision under those conditions, you would be able to freeze bank accounts, cut-off transactions, and seize any assets.

 

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And no, I've always had my car license and at best the city sent the parking tickets to collections, which, nobody pays them either lol.

Which impacts your credit rating.

 

New York City impounds vehicles and then sells them at auctions if people don't pay their parking tickets.

 

https://www1.nyc.gov/site/finance/vehicles/services-auctions.page

https://moneycheck.com/what-happens-if-you-dont-pay-parking-tickets/

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If you have more than two parking tickets, and a traffic violation or two, then you run the risk of the city impounding your vehicle.

 

In New York, the city sells impounded cars at auction to cover outstanding parking and traffic tickets. If you fail to pay the amount owed to the city, they can sell your vehicle, and lose out on far more than a few hundred dollars that you would have had to spend on the fines.