How #Brexit Is Effecting the Video Games Industry

On June 23, 2016 Britain withdrew membership from the European Union. This became known as #Brexit, or British exit, as social media exploded with the news. Pro-Brexit advocates have framed leaving the European Union as necessary to protect, or perhaps restore, the country’s identity: its culture, independence and place in the world. This argument is often expressed by opposition to immigration. “Remain” supporters typically argue that staying in the union is better for the British economy and that concerns about migration and other issues are not important enough to outweigh the economic consequences of leaving. This decision is effecting everything from the economy, to healthcare, and even the video games industry.

The video games industry is business like any other and is greatly effected by economic and political changes like #Brexit. Much like other major businesses, there are organizations created to protect video game developers, publishers, and the industry as a

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TIGA focuses on political representation, business services, and profile raising

whole. One of them is The Independent Game Developers’ Association, or TIGA. TIGA represents the industry all over the world but has a large base in Europe. 80% of it’s board members are developers and/or from UK owned businesses, and 50% of it’s board are UK business owners themselves. Speaking up for developers and publishers they said that there were four key issues facing the video games industry following the EU referendum.

Access to Finance

Difficulty accessing capital has consistently been the top factor holding back many games developers. In an uncertain economic environment, there may be a reduced appetite for investment. Additionally, outside of the EU, the UK games industry will not be able to access schemes such as Creative Europe and Horizon 2020 programmes. The UK Government should promote policies that encourage investment, maintain sector specific schemes such as the Video Games Prototype Fund and consider a Games Investment Fund to help start-ups and small businesses.

A favorable Tax Environment

Video Games Tax Relief and R&D Tax Relief have been crucial in enabling the UK video games industry to compete on a more level playing field against the UK’s international competitors, particularly Canada. In a post Brexit world it will be even more vital to maintain, improve and enhance these reliefs in order to attract external investment and to maintain the competitiveness of the sector.

Access To Talent

The UK video games industry relies on a highly skilled workforce to compete. Until now, the industry has had access to a substantial pool of skilled EU workers who can work in the UK without serious administrative restrictions. Brexit is likely to result in new immigration rules requiring employers to secure some sort of visa and to meet certain skills/salary criteria in order to employ migrant workers. It is vital that any new arrangements are not onerous or complex and that the industry is not held back by skill shortages.

Intellectual Property

IP is the lifeblood of the video games industry and the impact of ‘Brexit’ here could be significant. There are many commercial considerations. For example, the UK is part of both the Registered Community Design regime and the EU Trade Mark regime and also recognises the Unregistered EU Design Right. Such rights provide protection to rights holders across the EU Member States. Potentially, such EU related rights might lose their validity in the UK. The implication being that those parties who originally held such EU rights may need to apply for UK trademark and design rights to protect their rights in the UK. This may result in issues relating to existing development and publishing arrangements, IP licenses and security over IP rights.

The effect of #Brexit is far reaching. The Britain’s currency is dropping which is effecting the World’s economy. The effect is spreading to different sectors and I wouldn’t be surprised if American shores starts to see the ripple effect soon.

TIGA’s full press release can be read here

 

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