I attended a talk a month or two ago at Rezzed entitled Top Ten Legal mistakes that Indies make and how not to make them. The talk was given by Jas Purewal from Purewal and partners and distilled from experience rather than objective data. The legal firm focuses specifically on developers, YouTube channels and esports and so has an interesting perspective. The list is interesting and even if you are not a game dev might be relevant if you work or start a small business.
So what are the mistakes?
- Devs think contracts are a waste of time. Complicated and filled with things only lawyers understand. Not true. They are legalistic but get down what both sides are entitled to on paper. Read them very carefully and don’t give too much away. Ask for third party friendly opinions. Get as many perspectives as possible. Get a lawyer if possible.
- Devs think IP law is evil. Devs think it is a tool for big companies to squash little people. It can be abused but if you are careful it can protect the things you work with and create. It can be used to stop people squatting on YouTube and social media accounts and web addresses. Get a good basic idea of how it all works and keep up to date with legal changes
- Terms and conditions – devs think there’s no point putting these in as everyone just scrolls past it and ticks. It is the way to tell users what’s okay and what’s not and is still legal if not read by the user. This protects your business. They don’t have to be long but make sure they’re there before getting to beta.
- People think founders never fall out. They do. Make sure there is a written prenuptial agreement when starting a business. This is called a shareholders agreement and should be kept under review as the company grows.
- Staff can be employees or contractors – so what? Contractors own their IP unless their contract says otherwise. Contractors could be ipso facto employees under law – what they do matters not what they’re called. Employment law raises tax and admin issues that should not be ignored.
- Age ratings – they’re not irrelevant from a legal position and are still needed for PC and console physical releases. In some foreign markets like Germany and Australia they can be crucial and even in the UK they are relied on by regulators and parents.
- Devs think tax breaks are not worth it. They actually can be useful – it’s a lot of paperwork but you can save up to 20% of revenue straight out and even can get money back even if your game makes no money – up to 25%. It is worth looking at. If there is free money on the table you’re crazy not to take it.
- Free 2 Play is becoming more regulated. The UK is the only country in the world with regulations specifically for F2P. More red tape is coming. It’s not just a single platform problem now and can’t be passed off on Google, Apple or Microsoft.
- Devs don’t want to get lawyers involved. They think lawyers don’t get games and are super expensive. There are specialist law firms – find the right one. A good lawyer is also a business advisor and a contact who can be used.