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So, you are considering upping your game in esports and joining a team. Short of having your own lawyer, what are some of the top five things for you to consider from a legal perspective? In this first of a two part series for Asia Law Network, video games and entertainment lawyer Adrian Kwong shares his views of some things a player might want to note before signing a contract.
I’ll be direct. Your first priority is to read your contract before you sign anything. Make sure you understand what it says, including what you are agreeing to do (and just as important, not do), for how long, and what you get in return.
Do not sign anything that you don’t properly understand (for example, a contract in a language you aren’t confident in), that you feel that you are being rushed into signing (“if you don’t sign it now you will lose the deal”) or where you feel that you will not be able to live up to the terms or where they seem excessive (“if you leave, you will not be allowed to play in any other team for 5 years and must pay a buyout fee of $500,000”).
Once you put your mark on the dotted line, the contract would usually become legally binding, and walking away could result in you being accused of breaching the contract and liable to being taken to court, with all the cost and trouble that could bring.
So what are some key contract areas to look out for?
Are you clear about what you are signing up to do? Do you understand the contract language? How long is the contract for? What does the contract say about appearances, training, and tournaments? What level of performance and commitment is expected from you? What obligations are serious enough that the contract can be “terminated” if they are not met? Can you accept any contractual restrictions on your leisure hours, outside activities or the people you associate wit
How are you being compensated under the contract? Are you clear about what you are supposed to be getting, how you will get it (cash, or in other forms?), and how often? How are any prize winnings or sponsorships divided? Who pays for equipment, travel and other expenses? Are any payments linked to specific KPIs (for example, not reaching a certain number of views online?)
Are you an employee or an independent contractor? If you are drawing regular income, great, but note that you may be likely liable for Central Provident Fund and other deductions (there is a very low legal threshold of only S$50.00 a month). And as an employee, are you getting itemised payslips, the correct leave or off-days, and are you covered by insurance (for example, for repetitive stress injuries or accidents while at an event? One more thing, post-contract: be very clear when you are supposed to be paid and when, as repeated late payment could be a big red flag.
3. “Minors and mistakes”
Are you old enough to sign the contract on your own? In Singapore, the age of majority (being an adult) is 21 years, except for certain exceptions that starts at 18. If you are not an adult, that is, you are still a “minor”, you might need your parent or legal guardian to sign this for you. If you are under the age of 16, your working hours are also limited by law.
Claiming you were “only a kid” and did not know what you were signing could be legally problematic for you and your parent(s) if they co-signed with you. And it could affect your value in the market as not being dependable. Plus, you might have to return any money you earned from the company who hired you.
4. “Media and sponsors”
Be aware that you have certain rights over your personality, image and name – these can be valuable from a media and personal marketing perspective – think YouTube stars. Whatever contract you sign, do not sign away your rights by mistake. Will you have any say in when and how you can appear in public, or what you can say or do? What and when can you reject?
After you sign, and if you gain a following, will you be able to sign up your own sponsors and advertise their products or services? This could certainly impact your earnings directly. One last thing : do you own your gamer tag?
As with mainstream sports personalities, teams and sponsors are loath to associate themselves with troublemakers, and may be quick to drop controversial figures under what are termed “morals clauses”. Are you clear what the contract says is off-limits, or needs your attention while playing or even commentating? For example, language (profanity/offensive/age suitability), competing brands, politics, the intellectual property rights of third parties, cultural or religious taboos and more. Aim to be honourable and professional, even in defeat. If in doubt, do you want to say it over a recorded live broadcast? Beyond any contract, I would also caution you against potentially illegal behaviour – cheating, throwing matches, taking bribes, using banned stimulants, and so on would likely amount to criminal liability, in addition to getting you terminated.
Being an esports athlete, although a new and growing option for those who have the right skills, is not legally unique. But as with any field where the market is still in flux and the law may not always have clear answers yet, a little caution up front – and possibly a legally trained mind reviewing your contract terms for you – can possibly help avoid massive battles in the legal arena later.
This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. If you require any advice or information, please speak to a practicing lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of Interstellar Group Pte. Ltd. accepts or assumes responsibility, or has any liability, to any person in respect of this article.