Fun and Games of Interactive Gaming: Consumer Legislation and Advertising P.3

by Morrison Kent - Rochelle Cooney

In this series of three articles, we have discussed different issues for game developers to consider during the development, production and exploitation stages of game development.

This final article in the series covers other regulatory issues to consider such as consumer protection legislation, privacy and censorship classification. To learn more about interactive gaming read our first article which concentrated on considerations of confidentiality and intellectual property and the second article which focused on financing and distribution.

Consumer Protection Legislation and Advertising Standards

Interactive gaming is big business; the budgets and revenue rival that of films and TV programmes. Games are interactive and addictive, and so there is little surprise that gaming is the fastest growing sector of the entertainment industry. This area of entertainment involves an interesting and complex array of commercial and legal issues to navigate.

Under the Consumer Guarantees Act 1993 (“CGA”) a seller is deemed to make certain guarantees to a buyer of a product for personal use (the CGA does not apply to business to business transactions). Some of the guarantees include that the product is of acceptable quality, including being free from defects, fit for purpose and matches any description is given in advertisements. For example, in the case of a game, if it contains errors or bugs, this might fall foul of complying with the CGA and the customer can request that it is fixed within a reasonable time, or else can obtain other remedies such as a refund or replacement.

The Fair Trading Act 1986 (“FTA”) applies to anyone “in trade”, which includes businesses that sell products, including online and including digital products such as games. The FTA involves ensuring accurate information is given to consumers and prohibits traders from misleading and deceptive conduct, unfair practices and unfair contract terms and from making unsubstantiated claims or false representations. A seller will need to ensure that any representations they make about the goods are accurate and do not mislead or deceive consumers.

It is also best practice for any advertising to adhere to the self-regulatory advertising codes developed by the Advertising Standards Authority. The codes include a Code of Ethics which covers social responsibility and public interest considerations; there are also other codes which apply to particular areas, such as advertising to children and young people.  

CLASSIFICATION

Under the Films, Videos and Publications Classification Act 1993, games are automatically exempt from usual labelling requirements unless it contains restricted content or has certain overseas classifications. In such cases, the game will need to be submitted for classification in New Zealand and carry a New Zealand classification label.

There are certain criteria which aid in determining whether the content is “restricted”, and generally covers;

  • sex,
  • horror,
  • crime,
  • cruelty,
  • violence, and
  • offensive language (which could be “injurious to the public good”)

This will depend on the specific content and context in each case.

PRIVACY

The Privacy Act 1993 (“PA”) will apply if personal information identifying an individual, such as customer names, contact details or purchase records, is being collected, and compliance with the privacy principles contained in the PA will be required. The PA sets out specific procedures which must be complied with in relation to how personal information is collected, used, disclosed, stored, protected and how it can be accessed and corrected. We note that new EU regulations in relation to privacy and data may also need to be considered.

TAX

The application of goods and services tax (GST) to any sale and any withholding tax payable in relation to overseas transactions will also need to be considered.

SUMMARY

Be aware that if a game is going to be exploited outside of New Zealand (for example over the internet with no geo-blocking restrictions), requirements could be different in other countries and you will need to obtain specific advice to ensure compliance with local laws and regulations that might apply. The complexities of interactive gaming present many positives for developers, yet it is critical to consider the risks and seek legal advice to ensure you operate in accordance with any restrictions.

FOR MORE INFORMATION

For further information or to arrange an initial consultation with one of our Wellington-based media law experts, contact Andrew Stewart, email andrew.stewart@morrisonkent.com, phone (04) 495 8921, or Rochelle Cooney, email rochelle.cooney@morrisonkent.com, phone (04) 495 8910



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