Landmark French ruling says Valve must allow Steam users to resell their digital games

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UPDATE: Following the ruling in favour of French consumer group UFC-Que Choisir that Valve must allow Steam users in France to resell their digital games, the CEO of European video games trade body ISFE (International Software Federation of Europe) has said this ruling does not comply with current EU law. 

CEO Simon Little issued a statement claiming that digital downloads must be protected in order to combat piracy, and that complying with the French court ruling would result in dramatically increased piracy rates that would harm investment in the development of video games.

“This French ruling flies in the face of established EU law which recognises the need to protect digital downloads from the ease of reproduction allowed by the Internet,” Little said in his statement.

“Far from supporting gamers, this ruling, if it stands, would dramatically and negatively impact investment in the creation, production and publication of, not just video games, but of the entire output of the digital entertainment sector in Europe. If Europe’s creators cannot protect their investments and their intellectual property, the impact on both industry and consumers will be disastrous.”

“According to EU copyright law, when it comes to digital and streaming services, every use must be subject to the authorisation of the rightholder and copyright does not expire with their first sale, as it does with physical goods. Physical goods are subject to the “distribution right” and to the “exhaustion doctrine” which means that the purchaser has the right to resell the goods if they were first put on the market with the authorisation of the copyright owner. This is not the case with digital downloads which are subject to the “communication to the public right”, meaning that the purchaser does not have a right to sell them on, without the copyright owner’s permission.”

It’s not particularly clear how the ability to transfer ownership of a video game license would encourage piracy, although allowing Steam users to resell their digital games would obviously harm the bottom line of publishers as fewer ‘new’ copies would be sold. Little should obviously be an expert in his field and so should be keenly aware of the effects of such a ruling, although it’s difficult to see just where the conflict arises here.

Publishers will no doubt be leaning heavily on the ISFE to protect current standards as it’s their business at stake, and we could well end up seeing ruling in Parisian courts overturned if it’s deemed unfit for EU law.

Original Story: 20-Sep-2019 – Landmark French ruling says Valve must allow Steam users to resell their digital games

A landmark ruling has taken place following Valve’s defeat in the Parisian court. The court case took place between Valve and UFC-Que Choisir, a French consumer rights group, who argued Valve should not be able to prevent the reselling of any purchased digital goods on Steam.

The three-year battle in the Paris District Court has eventually seen Valve defeated as UFC-Que Choisir scored a possibly momentous victory for consumer rights. Valve has filed an appeal but, should it fail, this will set a remarkable precedent. “We disagree with the decision of the Paris Court of First Instance and will appeal it,” wrote Valve in a statement.

Paris District Court came to the following conclusion:

“The owner of the right concerned can no longer object to the resale of this copy (or copy) even if the initial purchase is made by downloading. The publisher of the software (or its beneficiaries) can no longer oppose the resale of this copy or copy, notwithstanding the existence of contractual provisions prohibiting a subsequent assignment. “

The ramifications of this ruling are potentially huge, and not just confined to the games industry. This is a ruling which is a step toward actual ownership of our digital products, and the right to buy and sell them to other people as we see fit. We’re talking about the potential ability to resell digital books, movies, albums, games, and software, or just straight up transfer them to one another. 

Here’s where it gets really crazy: under this ruling you would be able to lend your mates games. You’ll need to ask for them to give it back or you’ll lose access but, with full ownership comes all the benefits of physical goods.

On top of this, the move from licensing to ownership would mean Valve and its associated publishers on its storefront would no longer be able to make any claim on user mods or community content. In the eyes of the law, mod creators have bought a game and are allowed to use it in any way they see fit.

The effect of this ruling is difficult to anticipate. The Parisian courts gave no indication of how Valve could change in order to comply with the ruling, or indeed how any digital marketplace could continue to operate in their current fashion. The ruling is specifically related to purchased games, we know this much, which would mean gaming subscription services would not be affected by the change. An obvious change but significant change for Valve to make would be to sell gaming subscriptions, or to sell access to a game for a fixed period (one year, for example).

Thinking a little bit bigger about this, the ramifications could then rumble up through the entire European Union. If the EU’s governing body decides the French courts ruling should be upheld, the same procedures on digital ownership could then be rolled out to the rest of Europe. At that point, Steam and just about any digital store is going to be in an absolute mess.

At the time of writing, Valve has less than 30 days to remove the clause from its Terms of Service which says game licenses cannot be transferred, as well as to allow French users to sell digital games from their Steam libraries to other users.

Let’s throw it out to you then, what do you make of this little mess? A great advance for consumer rights and digital ownership, or will we turn out to be the losers at the end of it all?