Update 21/01/2021: Valve has responded to the European Commission’s allegations by saying they disagree with the Commission’s findings and the fine they have been fined. Read their full statement below. Original story from 01/20/2021.
Valve and a handful of game publishers have landed in hot water with the European Commission geo-blocking Steam keys in certain regions in Europe. The Steam owners, along with Bandai Namco, Capcom, Focus Home, Koch Media and ZeniMax (Bethesda’s parent company), have collectively been fined € 7.8 million (approximately £ 6.9 million) for “violating the EU antitrust rules “.
“Valve and the publishers restricted cross-border sales of certain PC video games based on the geographic location of users within the European Economic Area (‘EEA’), and engaged in so-called ‘geo-blocking’ practices,” the European Commission said. .
An investigation of Valve and the five publishers found that between 2010 and 2015 they had agreements to geo-block certain Steam keys, preventing them from being activated outside the Czech Republic, Poland, Hungary, Romania, Slovakia, Estonia, Latvia and Lithuania.
Geo-blocking is usually done so that games can be sold more cheaply in low-income countries. However, people in higher-income countries have often found ways to avoid regional prices in the past. Obviously, publishers aren’t a fan of this because it means those people are grabbing the lower prices.
Valve did not cooperate with the investigations and was fined € 1,624,000 (approximately £ 1.4 million). The publishers did cooperate and their fines were slightly reduced. Still, SnowRunner and Greedfall publisher Focus Home were fined € 2,888,000 (about £ 2.6 million).
A breakdown of the fines.
“Today’s sanctions against the ‘geo-blocking’ practices of Valve and five PC video game publishers are a reminder that EU competition law prohibits companies from contractually restricting cross-border sales,” said Commission Executive Vice President Margrethe Vestage. , said.
“Such practices deprive European consumers of the benefits of the EU Digital Single Market and the ability to shop around for the most suitable offer in the EU.”
This is naughty because the European Union’s digital single market is designed so that anyone living in the EU can buy and use things from all other EU countries.
This may not be the end either, as the Commission says: “Any person or company affected by anti-competitive behavior as described in this case can bring the matter to the courts of the Member States and seek damages.”
Update: Last night, Valve issued a statement to Eurogamer claiming that they cooperated in the investigation and disagree with the fine they were fined:
“During the seven-year investigation, Valve has worked extensively with the European Commission (“ EC ”), providing evidence and information upon request. However, Valve declined to admit that it was breaking the law, as the EC demanded. Valve disagrees with the EC’s findings and the fine imposed on Valve.
“The cost of the EC does not cover the sale of PC games on Steam – Valve’s PC gaming service. Instead, the EC claims that Valve has enabled geo-blocking by providing Steam activation keys and – at the request of the publishers – locking those keys to certain territories (“region locks”) within the EEA. Such keys allow a customer to activate and play a game on Steam once the user has purchased it from a third-party reseller. Valve offers free Steam activation keys and does not receive a portion of the purchase price when a game is sold by third-party resellers (such as a retailer or other online store).
“The region locks only applied to a small number of game titles. About 3% of all games using Steam (and none of Valve’s own games) were covered by disputed region slots in the EEA at the time. Valve believes that the EC’s extension of liability to a platform provider in these circumstances is not supported by applicable law. Nonetheless, due to concerns from the EC, Valve actually disabled region locks within the EEA as of 2015, unless those region locks were necessary due to local legal requirements (such as German content laws) or geographic limits on where the Steam partner is licensed to distribute a game. Removing region locks can also cause publishers to raise prices in less prosperous regions to avoid price arbitrage. There is no charge for sending activation keys from one country to another, and the activation key is all a user needs to activate and play a PC game. “