While China has been hearing more cases and trying to limit the “reskinning” of many popular video games published by U.S. and other foreign companies, China’s copyright law is too restrictive and does not consider the multitude of precedent as to how the industry has interpreted copyright regulation for video games. China’s copyright law sets such a high bar for originality that companies can create games with similar characters having similar abilities and mechanics, but still not violate China’s copyright laws. Chinese game companies have attempted to create mobile versions of popular games in order to make quick profits as well. These circumstances are compounded upon the fact that American companies have found limited success in domestic courts due to Chinese companies successfully raising the defense of forum non conveniens, which forces American companies to file cases in Chinese courts. However, Chinese law is far weaker in protecting video game copyright, leading this to be a detriment down the road for American video game publishers and companies.
This results in American companies losing a significant portion in revenue due to these reskinned cloned video games and incurring higher legal costs from litigating in a foreign venue. In 2018, mobile game publishers had lost over $17.5 billion in revenue from video game copying.2 There is also a multitude of steps for foreign publishers to release their games in China. Foreign publishers need to partner with a Chinese publisher, adding even more barriers.
However, there are other steps U.S. companies can take to alleviate these harms. While Chinese copyright law may not be suitable for U.S. companies to pursue successful lawsuits, China does have an Anti-Unfair Competition Law that is more flexible in the kinds of infringement it protects against. This is an avenue that U.S. developers can pursue if they wish to recoup their costs. Game companies can also reach out to live streaming services in China and give them exclusive rights to stream their game, which along with the Anti-Unfair Competition Law could greatly limit game cloning. Also, Chinese trademark law has given foreign companies much more success. Not all hope is lost for U.S. companies in attempting to protect their games.
ORIGINAL IDEA OR ILLEGAL COPYING? VIDEO GAME COPYING IN CHINA AND ITS EFFECTS ON THE U.S. VIDEO GAME INDUSTRY, FUTURE STEPS FOR U.S. DEVELOPERS AND PUBLISHERS,
38 Santa Clara High Tech. L.J. 215
Available at: https://digitalcommons.law.scu.edu/chtlj/vol38/iss2/2