Valve Couldn't Get Out of €1.6 Million Geo-Blocking Fine
The EU law punishes the company for preventing players from buying activation keys.
Image credit: T. Schneider, Shutterstock
Gatekeeping is not only a morally wrong thing to do but it can also leave you with a hefty fine to pay. This is what happened to Valve recently when it failed to prove the EU wrong.
Back in 2019, the EU started an anti-trust investigation into "bilateral agreements" between Valve and five publishers: ZeniMax, Capcom, Bandai Namco, Focus Home Interactive, and Koch Media. It was trying to find out if the companies were blocking activation keys based on their owner's location.
It might sound confusing, so here is the gist of the scheme. If you buy a physical copy of a game, you need to enter its activation key in Steam to prove you own it. However, as Engadget notes, these keys can be resold at lower prices, which is not good for smaller developers.
The EU Commission thinks Valve has agreements with the publishers above that require using activation keys "for the purpose of geo-blocking." It means that keys bought in certain countries (like the Czech Republic, Estonia, Hungary, and Latvia) can work in those countries only so that you can't buy a cheaper key there and use it in, say, Germany, where the price is higher. This breaks the EU competition rules enforcing an open market across the Union.
Eventually, Valve was accused of the practice and required to pay a €1.6 million ($1,68 million) fine. As expected, the company appealed the decision saying it was accused of the deed at the request of publishers and that it turned off region locks for most cases in 2015. Despite that, the court has rejected the appeal.
"Copyright is intended only to ensure for the right holders concerned protection of the right to exploit commercially the marketing or the making available of the protected subject matter, by the grant of licences in return for payment of remuneration," said the EU General Court. "However, it does not guarantee them the opportunity to demand the highest possible remuneration or to engage in conduct such as to lead to artificial price differences between the partitioned national markets."
Now, Valve has two months and ten days to appeal again, and it's hard to say if it's going to use this time or just pay the price.
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