Because of their huge popularity and reach, e-sports events are now considered an ideal platform for advertising. First of all, there are classic forms of advertising: these include logos on players' jerseys, the association of a company name with an e-sports organisation, or the use of players as influencers for certain products.

Beside this, virtual advertising can be integrated into e-sports broadcasts on streaming services or on television. Such advertising can be inserted using so-called overlays. These are graphically designed frames that are placed around the webcam image or live video. Another possibility is the digital post-processing of the broadcast image, in which advertising is inserted. This technology is used in the broadcasting of sports events, for example, to replace the real perimeter-board advertising in the stadium with virtual advertising.

For the broadcasting of e-sports events on television or the internet, certain rules and advertising principles must be observed pursuant to the German Interstate Media Treaty [Medienstaatsvertrag, MStV].

Principle of separation in streaming offers

In the case of streaming, above all the principle of separation pursuant to Sec. 22 MStV applies: advertising must be clearly recognisable as such and must be clearly separated from the remaining content of the offers.

(E-)Sport enthusiasts are used to advertising being placed on surfaces such as perimeter boards and jerseys, as well as sponsorship. For this reason, this provision has to be observed in particular when using players as influencers. Should a player make promotional comments about a company's products and/or services in the course of a stream and receive consideration for this, the video or corresponding video sequence has to be marked as such using the term "advertising" or "#advertising".

Use of virtual advertising: peculiarities in case of TV

According to Sec. 8 (4) MStV, the use of overlays - which results in the image broadcast on television being partially covered with advertising - is only permissible if a clear visual separation from the actual programme is ensured. In addition, the part occupied by the advertising has to be clearly marked as such, for example by inserting the term "advertising".

Additional special features apply to television broadcasts. If digital advertising is inserted on advertising spaces that are present in the virtual environment of the game, this is permissible under Sec. 8 (6) MStV if corresponding indications are given. However, this only applies in cases where an advertisement that is already present at the place of transmission is replaced, e.g. a real advert is replaced by another virtual perimeter-board advert.

This raises the question of what this means for the virtually held e-sports event or how the "place of transmission" is to be interpreted in the context of a video game. In principle, this depends on whether advertising is already integrated in the virtual environment of the video game. If this is the case, then it may also be replaced - at least according to the legislator.

Licence terms can also impose restrictions

Organisers must comply with the publisher's contractual regulations on the insertion of advertising. Under certain circumstances, the publisher will make explicit provisions in its licence terms. They regulates, for example, whether existing advertising spaces may be covered with own advertising. However, licence terms may also include a general prohibition on modifying the content of the game. This prohibition may include the modification of existing advertising, with the result that any violations may constitute an infringement of the publisher's copyrights. Incidentally, this applies both to streaming and TV broadcasting.

Particular caution in case of offers aimed at children and youths

If a streaming or TV offer is also aimed at children and youths and is to be advertised in a manner appropriate to the target group, additional special features must be taken into account. The German Interstate Treaty on the Protection of Minors in the Media [Jugendmedienschutz-Staatsvertrag, JMStV] provides media-specific advertising bans to protect children and youths.

According to this, advertising in broadcasting and telemedia may not contain direct purchase appeals to children or youths. This also applies to presentations aimed at inducing children to persuade parents or third parties to purchase the advertised goods or services. This especially applies to formulations such as "go get yourself...", "go grab yourself ..." or "buy yourself ...".

Consequences in case of violations

All these rules (also) constitute so-called market conduct rules according to Sec. 3a of the German Unfair Competition Act [Gesetz gegen den unlauteren Wettbewerb, UWG]. If they are not observed, this is considered a violation of the law that is punishable by the responsible State Media Centre. In addition, there is a risk of costly injunctive relief claims by the competition and consumer protection associations and competitors.