Law of Contracts

E-Sports Players Contract

By Adv. Nikita Vaigankar

Introduction

E-Sports is a word of recent origin. The word itself signifies that it is related to sports in an online mode. Newbies who are being introduced to the world of the internet would find it hard to believe such a thing as they would imagine sports to be played only physically. But yes! E-Sports do exist and now it has become a popular trend among youngsters. 

E-sports is related to video game culture and competitions conducted by and in the video game industry. It refers to multiplayer video games competitions which are well organized and are given a professional outlook. The prime difference between an online video game and E-sport is that E-sport involves spectators wherein professional players play a game online with other competitors and a bunch of people spectates that game which is broadcast live.

It is noteworthy that E-sports recently, have been included as a medal sport at the Asian Games, 2022 by the Olympic Council of Asia (OCA)

Laws governing E-sports

In India, E-sports are governed by the ‘Public Gambling Act, 1867’, which is a central legislation and it primarily regulates gambling. Apart from this, one of the important legislation that covers aspects related to E-sports is Information Technology Act, 2000’ which is a broader law to regulate illegalities in the IT sector.  

Moreover, in the year 2019, Mr. Shashi Tharoor had introduced a private member bill in the Lok Sabha titled as ‘Sports (Online Gaming and Prevention of Fraud) Bill’. The main object behind the introduction of this bill was to initiate a strong statutory framework for the regulation of E-sports in India. This was aimed to maintain the integrity of sports in India by penalizing fraud in sports. The bill intends to cover also fantasy gaming and to set up a commission that shall work upon the regulation of E-sports. Apart from this, the bill shall also enhance the investment in this sector.

However, it can be broadly stated that apart from all these legislations, the legitimate and reasonable terms, conditions, rules, procedures, by-laws framed by the organizers of an event would hold a superior position in case of violations of any sort by the players.

Organization for governing of E-sports in India

In India, an organization namely, ‘Electronic Sports Federation of India’ (ESFI) is established with an aim to promote, encourage, organize and control E-sports in India. It strives to promote different areas of E-sports with an objective to remove unnecessary limitations levied upon E-sports. 

Not only this but it also moves on to facilitate skill development in the field of E-sports and enhances the building of infrastructure in the said field. Most importantly, it also acts as a regulatory and development body for E-sports in India.

E-sports Contract of Players

Like physical sports, E-sports would run smoothly if there is are some stipulated terms and conditions agreed between the organizers and players. These terms and conditions can be penned down in an official and formal contract duly registered. Such contracts are known as E-sports contracts which enhance cordial relations between the players and the organizers or any other person associated thereto. 

Thus, an E-sports contract can be categorized into an ‘Employment contract’, which is basically designed to set out the terms of employment in detail. The parties to the contract would prima facie include the organization and a player and it would limit itself for a specific period until a specific amount of years or until a specific tournament or event ends.

However, there may be many organizations that do not bother to enter into contracts with the players and they run without contracts but this relationship may be highly fragile which may not ensure a long and successful venture.

Crucial clauses to be included in a Contract

Any employment contract is executed between the parties with an aim to be clear with respect to the terms of employment. Similarly, even in the E-sports contract, it is quite pertinent to note a few essential clauses which make it a full-fledged one.

  1. A non-compete clause: Through this clause, an organization can restrict a player who is a part of the contract, from joining any other tournament of similar nature. It can stop him from disclosure any information or associating with any other E-sports organization during the tenure of the contract. This clause can also set up a code of conduct for the players because by signing a particular player, the organization puts its reputation at stake.
  1. Duties of the players: The contract can comprehensively set forth the duties of the player/s who are party to the contract. These can include participating in promotional events which can even extend to the appearance of the player/s during such events. For example, wearing a jersey of the team or using a logo of the organization, etc. It can also mention participating in various events and tournaments too with their best skills and capabilities.
  1. Service Clause: This clause is important as it would cover all the clarifications related to the service including the mode of working. It shall cover even a way in which an employee is expected to work, their hours of work, conditions related to the deadline, work efficiency, and many more minor issues related to the service of a player with the organization.
  1. Revenue sharing Clause: Players are given a guarantee of a percentage of reward from the earning of the teams which may include in-game rewards or individual prize money. The reward is split among the participating players and a small percentage is taken by the team. Due to such involvement of technicalities and complexities, it is better to state the percentage of the revenue to be shared in order to avoid further untoward rivalry.

The above mentioned are a few of the important and special clauses which can give a perfect shape to E-sports contracts. 

However, apart from all these, general clauses which are essential to every contract are very much necessary as they form the base of a contract. Such general clauses may include a clause related to the term of the contract which shall speak about the specific time period of employment and conditions for renewal. There can be a clause mentioning the fees and payment during such time intervals as agreed upon with mutual consideration between the parties. 

Challenges for E-sports contracts

By now, it is clear that E-sports contracts are not a general form of contracts and have to be drafted with utmost care and passion. Moreover, these contracts bloom up with a lot of hardships and challenges especially because they are of recent origin. Enforcement of these contracts is not easy as there is a blur vision of the existing rules and laws governing E-sports and hence, it may give rise to many unanswered or tricky situations time and again.

Another huge obstacle to such contracts is the inclusion of minors in the E-sports or gaming industry. Minors now due to easy access to technology have been handling techno-gadgets quite easily and have become pros or experts in this field. So, even before attaining legal age, they are part of this, and hence, this gives rise to a huge clash with the Indian Contract Act, which clearly specifies that any contract entered with the minor is unenforceable, thus, E-sports contract fails here.

It is, therefore, necessary to execute the E-sports contract from a professional and experienced lawyer so that there is no scope for misdoings and it would not hamper its enforcement.

Conclusion

E-sports are well known for their popularity as a form of entertainment. However, it does not just render the purpose of entertainment but it is also a source of income for some players who are totally dependent upon it. E-sports accommodates a highly versatile and dynamic community within it. The prizes for the winners can range up to millions of rupees.

India is amongst the top 5 countries in the world to be involved in online gaming. Owing to such a wide fanbase and participants, it is a need of the hour that strict regulations are being implemented. But unfortunately, at present, there are no proper laws to regulate E-sports and hence, E-sports contracts carry heavy weightage and importance as it remains as the only tool in the hands of the organizers as well as the players to protect their rights and interests.

If such contracts are in place, then there are minimal chances of friction or indifferences between the parties. It would help to avoid misinterpretations and misunderstandings as it would give absolute clarity with respect to the relationship, rights, and obligations of the players towards the organization/s with which they are associated to.

On the other hand, since the legal position is not clear, profit-seekers take it as an opportunity to find out the loopholes and secure a lot of advantages even by wrongful means and try to evade the legalities.

The growth of the E-sports industry has been tremendously on the rise in the Covid 19 pandemic, with people relying more and more on the internet for entertainment as well as for income by making E-sports their full-time and long-lasting career.

With the growing trend of E-sports, India needs to cope up with the speed of growth and introduce legislation governing E-sports because if the law is in place, heavy investment in this sector can be ensured as the investors will find the environment to be more secure.

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