Yesterday, the European Commission announced that it is investigating Valve and a handful of major game publishers for anti-competitive practices on Steam. Today, the French gaming trade group Syndicat National du Jeu Vidéo pushed back at the Commission, offering an explanation as to why those companies may have undertaken the offending actions in the first place.
Valve, Bandai Namco, Capcom, Focus Home Interactive, Koch Media and ZeniMax are under investigation for geo-blocking: selling activation keys for games that can only be used in a specific region, such as the Czech Republic or Poland. EU rules prohibit attempts to reduce cross-border competition or restrict parallel trade, so geo-blocking to prevent consumers in one region from buying games that are being offered more cheaply to residents in another region of the EU could be deemed illegal.
In its statement, the SNJV suggested that the geo-blocking was done to thwart key resellers, a long-running sore spot for PC publishers and developers.
"The investigation is focused on possible geo-blocking practices that might have occurred to counter the emergence and growth of certain conduct on the digital video game marketplace whereby some companies massively purchase digital activation keys priced for distribution in territories with low consumer purchase power and then resell such keys globally via the internet at higher price; The SNJV has long been concerned by this parallel market, which potentially allows for the avoidance of tax laws and European regulations that normally should apply, and penalizes both European consumers and video game creators.
"We hope that by shedding light on this context, European and national authorities will be able to propose solutions to video game creators and publishers that, today, are impeded from selling their games in certain European territories at prices that are affordable to the general public compared to local purchasing power."