Today, the European Commission has announced that they have fined Valve and five publishers € 7.8 million for breaching EU antitrust rules. The five publishers are Bandi Namco, Capcom, Focus Home, Koch Media, and ZeniMax. The reason for the fines is because Valve and the publishers restricted cross-border sales of certain PC video games on the basis of the geographical location of users within the European Economic Area (‘EEA’). Because of this, they entered into, the so-called “geo-blocking” practices.
The “geo-blocking” practices that Valve and the other five publishers engaged include bilateral agreements and/or concerted practices between Valve and each of the five PC video game publisher implemented by means of geo-blocked Steam activation keys which prevented the activation of certain of these publishers’ PC video games. This happened outside of Czechia, Poland, Hungary, Romania, Slovakia, Estonia, Latvia, and Lithuania. These lasted between one and five years and were implemented between September 2010 and October 2015. Four out of the five publishers restricted cross-border sales of the affected PC video games within the EEA. This includes Bandi Namco, Focus Home, Koch Media, and ZeniMax. These lasted longer between three and eleven years and were implemented between March 2007 and November 2018 depending on each bilateral relationship.
The five publishers cooperated with the Commission by providing evidence of added value to the investigation and expressly acknowledged the facts and infringements they committed. Because of this, they were granted reductions depending on the extent of their cooperation ranging from 10% for Bandi Namco, Focus Home, Koch Media, and Zenimax, and 15% for Capcom. Valve chose not to cooperate and the Commission adopted a prohibition decision against Valve under the ordinary antitrust procedure. Bandi Namco was fined € 340,000, Capcom € 396,000, Focus Home € 2, 888, 000, Koch Media € 977,000, ZeniMax € 1,664,000, and Valve € 1,624,000.
“More than 50% of all Europeans play video games. The video game industry in Europe is thriving and it is now worth over € 17 billion. Today’s sanctions against the “geo-blocking” practices of Valve and five PC video game publishers serve as a reminder that under EU competition law, companies are prohibited from contractually restricting cross-border sales,” Executive Vice-President Margrethe Vestager said. “Such practices deprive European consumers of the benefits of the EU Digital Single Market and of the opportunity to shop around for the most suitable offer in the EU.”