By Dr Estelle Ivanova, Attorney at Law, Paris, France
The rapid professionalisation and commercialisation of esports, with an estimated current global value of between US$3.3 billion (around €2.8 billion) and US$5.34 billion (around €4.59 billion), are increasingly raising issues under European Union (EU) competition law.
Unlike traditional sports, esports competitions are organised around video games protected by intellectual property rights and owned by private game publishers. This distinctive structure gives publishers significant legal and commercial control over the use of their games and the organisation of the competitive ecosystems surrounding them.
These structural particularities do not, however, place the economic activities associated with esports outside the scope of EU competition law. Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU) may apply where their respective conditions are satisfied.
The combination of proprietary control, rule-setting functions and commercial activities raises particular EU competition law issues, notably relating to market definition and market power; tournament licensing and access for third-party organisers; as well as restrictions affecting teams and professional players.
Publisher Control, Market Definition and Market Power
IP Control
An important distinction must first be drawn between intellectual property exclusivity and dominance under Article 102 TFEU. Ownership of a game gives its publisher exclusive rights over the exploitation of the protected title, but does not, per se, establish a dominant position. As the General Court has recognised, the mere possession of intellectual property rights does not confer dominance, although such rights may, in certain circumstances, contribute to the existence of a dominant position (AstraZeneca v Commission, Case T-321/05).
Relevant Markets
The relevant market definition, therefore, is a central part of the analysis. The main purpose of the European Commission Revised Market Definition Notice of 8 February 2024 (C/2024/1645), is to identify the effective and immediate competitive constraints faced by the undertakings concerned. The relevant product market comprises products regarded by customers as interchangeable or substitutable, taking into account their characteristics, prices and intended use, as well as the conditions of competition and the structure of supply and demand.
In esports, the relevant market will depend upon the economic activity and competitive relationships under examination. The European Commission decision in Microsoft/Activision Blizzard (Case M.10646, Commission Decision of 15 May 2023) illustrates the potential for different levels of market definition in the gaming sector, including distinctions according to platform, game genre and game type.
Whether a narrower market may be appropriate in an esports context would similarly depend upon the competitive constraints and substitutability involved.
The case also illustrates how control over important gaming content may be relevant when assessing potential foreclosure. In particular, the European Commission considered Activision Blizzard games an important input for cloud game streaming services and examined whether restricting access to that content could affect competing distributors. Although that assessment concerned game distribution, rather than esports tournament organisation, it illustrates more generally how control over gaming content may become relevant where access to that content affects the ability of third parties to compete.
Barriers to Entry
Similar caution is appropriate when considering barriers to entry in esports. Intellectual property rights attached to a game may require third-party tournament organisers to obtain the necessary authorisation to use that title. Depending upon the structure of the relevant market and the availability of alternatives, such licensing requirements may influence the conditions of entry into the competitive ecosystem. Whether they raise concerns under EU competition law, however, requires a case-specific assessment of the relevant market, the publisher’s market power and the nature and effects of the conduct concerned.
Restrictions on Third-Party Competitions
Prior Authorisation
A particularly important issue is the ability of publishers to authorise, restrict or prohibit third-party esports competitions. The case law of the Court of Justice of the European Union (CJEU) on traditional sports provides an important point of reference.
In European Superleague Company (Case C-333/21) and International Skating Union v Commission (Case C-124/21 P), the CJEU examined rules under which sports bodies controlled access to competing sporting events, whilst themselves carrying out economic activities connected with the organisation of competitions.
In European Superleague Company, the CJEU held, in the context of Articles 101 and 102 TFEU, that powers of prior approval governing access to the market must be subject to substantive criteria and detailed procedural rules capable of ensuring that they are transparent, objective, non-discriminatory and proportionate.
Similarly, in International Skating Union, the CJEU confirmed, under Article 101 TFEU, that prior authorisation and eligibility rules, which were not subject to such safeguards, had the object of restricting competition.
Conflicts of Interest
The analogy with esports nevertheless requires caution. A publisher does not exercise regulatory authority on the same institutional basis as FIFA, UEFA or any other international sports federation: its control derives primarily from intellectual property rights and contractual arrangements.
The underlying competition concern may nevertheless be relevant where an undertaking with substantial market power is able both to determine the conditions under which third parties may enter a market and to compete commercially on that market.
Accordingly, where a dominant publisher organises its own tournament circuit, whilst restricting licences or access for competing organisers, the compatibility of those restrictions with Article 102 TFEU may require careful examination.
Where restrictions arise from agreements between undertakings or decisions by associations of undertakings, Article 101 TFEU may also be relevant.
Players, Teams and Ecosystem Fairness
Exclusive Subordination
Similar EU competition law issues may arise relating to players and teams.
Participation in esports can be governed by publisher rules; end-user licence agreements (EULAs); codes of conduct; tournament regulations; licensing arrangements; and contractual obligations. Unlike traditional federated sports, players and teams may also operate without comparable forms of independent institutional representation.
Mobility and Contracts
Restrictions relating to player transfers, team franchising arrangements or the exclusion of players or teams from participation, including through blacklisting practices, may raise competition law issues in certain circumstances.
However, restrictions pursuing legitimate objectives, such as competitive integrity or the prevention of cheating, are not necessarily anticompetitive. Their compatibility with EU competition law will depend upon the applicable legal framework and the particular circumstances, including the nature, scope and effects of the restriction.
The CJEU approach in International Skating Union (Case C-124/21 P) is relevant in this respect, as the eligibility and prior-authorisation rules at issue affected both competing organisers and athletes, whilst potentially limiting opportunities for consumers and audiences.
The position of esports players nonetheless requires a distinct analysis. Unlike athletes operating within a traditional federated sports structure, esports players participate in ecosystems ultimately dependent upon privately owned intellectual property. Restrictions affecting player participation or mobility may raise issues under EU competition law or the Treaty provisions on free movement, depending upon the player’s status and the circumstances concerned.
The Wider Digital Context: The EU Digital Markets Act
Gatekeepers and the Esports Digital Ecosystem
The EU Digital Markets Act (DMA), applicable since 2 May 2023, adds a further regulatory dimension by seeking to ensure contestable and fair digital markets where designated gatekeepers are present. Game publishers are not, however, gatekeepers merely because they control valuable gaming intellectual property.
The DMA may nevertheless be relevant to the broader esports ecosystem, as games and related services depend upon digital distribution channels, operating systems, app stores and other platforms that may be subject to gatekeeper obligations.
Complementarity with EU Competition Law
Importantly, Article 1(6) DMA preserves the application of Articles 101 and 102 TFEU, as well as the competition and merger control rules specified therein. The DMA and EU competition law may, therefore, operate alongside one another, pursuing distinct but complementary objectives.
Conclusions
The application of EU competition law to esports ultimately requires a case-specific assessment.
Publishers are legitimately entitled to protect and commercially exploit their games, and intellectual property ownership should not, per se, be equated with dominance.
Even where a dominant position is established, Article 102 TFEU prohibits its abuse rather than dominance as such. Restrictions affecting tournament organisers, teams or players may, therefore, require scrutiny under Articles 101 or 102 TFEU, depending upon the nature of the conduct concerned.
Recent EU competition law developments, from European Superleague Company and International Skating Union to the European Commission gaming merger practice and the DMA, provide useful points of reference for this assessment.
At the same time, EU competition law forms part of a broader regulatory environment for esports, in which rules relating to data protection, foreign investment screening and, where applicable, anti-money laundering may also become relevant.
As esports ecosystems continue to develop, navigating these different regulatory frameworks will become increasingly important. For EU competition law, the central challenge will remain how to reconcile the legitimate exercise of intellectual property rights with the preservation of competitive opportunities within privately controlled gaming ecosystems.
Dr Estelle Ivanova is the Co-Author with Prof Dr Ian Blackshaw of a forthcoming Book entitled ‘Sport and EU Competition Law: An Introductory Guide’, to be published by Edward Elgar Publishing, and may be contacted by e-mail at ‘