Edugameshub asked Jas Purewal (@gamerlaw), Specialist Media Lawyer at Osborne Clarke and Gamer to share his top tips on what games makers need to know about the law.
There are five main legal areas for edugames makers (and developers in general) to consider:
1. Intellectual property (IP)
This heading covers three types of IP: copyright, trademarks and confidential info
Copyright protects active aspects of games i.e. the underlying ideas, look, etc. Copyright just exists. From the moment you create your game, you have copyright. If someone copies it, you can sue them. The fact that you have copyright also means that you can sell your game.
Trademark protects the way your game is marketed, e.g. name of company, name of game, name of main characters. For example: Sega, Super Mario, Angry Birds. To own trademarks, you have to apply to register them (and pay a fee). As a result, trademarks are a little more valuable than copyright. If you launch something, you should trademark it.
Confidential info: if you are talking to e.g. a major retailer about your game, its safer to protect what you give away. This is not an IP right as such, but is just as important. Relatively easy to protect it via non disclosure agreements (NDAs), etc.
(Jas also briefly discussed patents, which are IP rights which protects innovations and inventions. Patents are beyond the consideration of your average small developer, but if you are thinking about registering a patent, Jas’s advice is to wait until you have real business growth before you worry about patents.)
Jas has written a guide to copyright in games here and a guide to trade marks in games here.
2. Contracts
In Jas’s experience, developers are needlessly scared of contracts. His advice is: don’t rely on verbal agreements or handshakes – document your agreements in writing (even if it’s just emails). Contracts are the single most important day to day legal asset in your business. Just writing out a contract settles what you want and what you are going to get. Don’t skimp on contracts, especially for e.g. distribution deals. Always read everything and query anything you don’t understand. Think also about the contracts you form with your users, such as end user licenses. Some games have disappeared due to not having the correct end user licenses. A contract can be verbal, it can be an email, but a formal written contract is usually best, especially when unpredictable events occur.
3. Regulation
Jas’s third piece of advice is to be careful when making things intended for children. Always involve the parent. You cant have an enforceable contract with a child. Consider ratings, if applicable. In most online games you don’t have to worry about ratings. Ratings bodies are mostly concerned with consoles. However, Apple, etc have their own policies. Try to make it obvious these things are kid friendly. Have a section explaining how to use the game safely for kids. Be proactive. If collecting data, know that personal data is data that could identify people e.g email address, school, age, address. Be careful! Don’t simply require young users to supply all this info – understand what you are getting into first.
4. Funding
There are different ways of funding your game. Bootstrapping is the quickest and easiest way to get your game off the ground (but of course you need to have the resources to be able to do that). Publisher or other outside funding is a possibility, but you may have to give up some or all of your game IP or game revenues in return. Equity funding (in which you give up shares in your company) is also possible, but it is increasingly difficult to get – in games and especially in education. Finally there’s the option of debt funding, in which you obtain loans to fund the game (though that requires people willing to loan you the money!) Whichever option you choose, you need to be able to show the funder how your business is going to be successful and therefore deserve the finance.
5. Tax
There are increasing amounts of tax relief schemes which can help investment into your company and to reduce its payable tax. For example, you may want to consider the tax reliefs offered by the Enterprise Investment Scheme (EIS): an incentive to get investment and tax relief. Your business must have been trading for at least 4 months to be eligible.
Jas’s Top Tips
Trade via a company and not as a sole trader. Split it off from personal finances or other companies.
Don’t get employees and directors before you have to. Use contractors.
Legal compliance is good to know about, but experienced legal advisors will tell you when you need to worry and when you should just focus on building a great games business.
If you want more tips from Jas, his blog is incredibly useful.
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