Review of the legality of game prize distribution

Law firm Veat received a request from game company A (hereinafter referred to as the "client") to review the legality of prize disbursement based on the results of a sports game.

The client requested a legal review to ensure there were no legal issues before predicting the results of sports games and disbursing various prizes, such as virtual assets and physical prizes, to top users based on game results.

The 「Act on Promotion of Game Industry」 (hereinafter referred to as the "Game Industry Act") clearly stipulates regulations for game rating and prevention of gambling. All games must undergo a rating classification in advance, and during this process, whether the game content contains elements of gambling is a major point of review. Disbursement of virtual assets or physical prizes is severely restricted due to gambling issues.

Law firm Veat comprehensively reviewed the possibility of game rating classification under the Game Industry Act regarding the prize disbursement method of the game, the possibility of prize disbursement under the Game Industry Act, and provided professional guidance on the scope of services that could be carried out within the framework of existing laws.

The methods and means of disbursing virtual assets, physical prizes, etc. for game products are quite limited and, since games that predict the results of sports events involve a system where users receive prizes based on their predictions, gambling elements may exist. It is particularly important to receive a legal review in advance regarding the scope of possible services, as strict supervision is being carried out on gambling issues.

Act on Promotion of Game Industry ("Game Industry Act")
Game Industry Act Article 21 Game Rating Classification, Game Industry Act Article 28 Prevention of Gambling Regulations

According to the Game Industry Act, all games must undergo a rating classification in advance. The rating classification procedure is performed by the Game Management Committee, which thoroughly reviews the game content and elements of gambling. In particular, games that disburse virtual assets or physical prizes undergo stricter review, as the elements of gambling may be strongly involved.

The Game Industry Act aims to protect users and foster a healthy game culture by implementing strict regulations to prevent gambling, and prize disbursement is directly linked to gambling issues and is allowed only to a limited extent. The Act details the regulation of the type, method, and amount of prizes to prevent illegal prize offerings.

We focused on a detailed review of compliance with regulations related to gambling issues, the legal status of virtual assets, and the legality of prize disbursement. Law firm Veat provided guidelines to secure the legality of the game and provide users with a safe gaming environment through this legal review. In particular, we clarified the legally permissible scope regarding the disbursement of virtual assets and physical prizes, contributing to securing the legality of the game service.

Law firm Veat boasts high expertise in legal advisory services for IT, startups, and particularly the game industry. Based on a deep understanding of the Game Industry Act and extensive experience, we provide the best legal advice to clients. Through this case, the client was able to develop a plan to safely and legally provide services within the framework of existing laws.

The 「Act on Promotion of Game Industry」 (Game Industry Act) and the 「Special Act on Regulation and Punishment of Gambling」 (Gambling Regulation Act) are the main laws related to the legal regulation of the game industry. These laws address various issues that may arise in game development and operation, and in the relationship between the game developer and the user. Law firm Veat provides solutions by providing extensive legal knowledge related to the Game Industry Act, the Gambling Regulation Act, accurately understanding the problems faced by the client, and providing effective solutions.

If you require legal advisory services for game services, such as the 「Act on Promotion of Game Industry」 (Game Industry Act) and the 「Special Act on Regulation and Punishment of Gambling」 (Gambling Regulation Act), please contact Law firm Veat.

Thank you.
Law firm Veat