The Court of Justice of the European Union (CJEU) has upheld its previous ruling that Valve and five PC videogame publishers unlawfully restricted cross-border sales of certain PC games compatible with the Steam platform. This decision comes after Valve’s attempt to convince the court that the geo-blocking of Steam game activation keys did not violate EU law.
Geo-blocking refers to the practice of restricting or excluding customers from certain offers based on their nationality or location. It is considered a violation of EU competition rules, as the European Union aims to create a single market where equal access to products is ensured across member states. In the case of Steam, prior to 2015, publishers could set policies that prevented certain keys from being activated in specific member states to prevent price arbitrage.
The EU Commission launched an investigation into companies potentially violating competition rules in 2017, and in 2021, it fined Valve and the five publishers €7.8 million for using geo-blocking practices. Valve appealed this decision and sought to annul the court’s ruling, arguing that it only provided publishers with technical functions at their request and did not have a common intention to engage in specific conduct on the market.
However, the CJEU rejected Valve’s arguments, stating that the investigation had established the existence of an agreement or concerted practice between Valve and the publishers to restrict parallel imports through geo-blocking. The court found that geo-blocking had been used to prevent low-priced games in certain countries from being purchased by distributors or users in countries with higher prices. It also dismissed Valve’s argument that geo-blocking had pro-competitive effects and rejected the claim that it infringed on copyright protection.
As a result, it is likely that Valve will have to pay the €1.6 million fine imposed by the EU Commission. Valve has not yet commented on the ruling.