Metaverse legal issues – Watch & Tribune> Retail

The first of these challenges is undoubtedly the possible reduction in competition. Tomorrow, one or two metaverse platforms (Microsoft, Meta …) may dictate their market terms. In order to sell these platforms, it is necessary to accept their unbalanced contractual conditions (delisting, explosion of royalties, need to use an encrypted money kept by a subsidiary, etc.). So the risk is to see some platforms laying down the law about trade in this new universe. Penalties for abuse of dominant position, unbalanced clauses already exist. The upcoming DSA is expected to strengthen their effectiveness across Europe.

The second issue is the protection of personal data: by purchasing virtual reality platforms, individuals can be led to send more personal data to a new type of vendors. Seeing facial expressions, creating avatars that change human features as honestly as possible are examples of what a shopping experience in virtual shopping malls can be like in the future.

However, biometric data is considered sensitive data that should benefit from enhanced protection.

The CNIL considers in particular that the consumer should be able to receive confirmed information about the device and be able to reject it with no consequence for him: therefore he should be able to proceed with his purchase. Not sure if the metaverse is quick to lend it to.

More broadly, the European regulation on the protection of personal data (GDPR) needs to be respected in a more complex context than today. Determining who is responsible for processing can cause a problem: is it the online vendor or the metaverse platform? Do they have this role, and if so, are they the same and equally accomplished? These questions have an important concrete importance on the responsibility and obligations of users, especially the information obligation for the purposes of data collection and reuse. Their move outside the European Union has not yet ended up asking thorny questions.

Also read: Open data: These startups take advantage of open data!

Another topic for reflection: the user-consumer is naturally an important player in the metaverse, if for example he or she interacts through his or her avatar with another user. Could it be that this avatar, an extension of his person, has rights and is he acting on his own responsibility?

Now the answer is simple because the law only recognizes legal persons and natural persons. So any behavior should be dedicated to one or the other. So an avatar can’t buy and pay online: the consumer is still a human being.

The fourth issue is not the least. This is the protection of intellectual property rights: copyright of course, but also design and model law, and trademark law. Retailers who offer their products in a virtual shopping mall need to be careful to get all the necessary rights to the items being reproduced in this new universe. Therefore, the contracts of assigning stylists should be reviewed and amended as necessary.

Similarly, brand words need to be added so that metaverse marketing can occur without legal difficulty for the seller. For example, filing for a class 25 shoe brand is not enough. The metaverse is not an e-commerce site like others but a new virtual space.

This should also be kept in mind the development, exploitation or sale of NFTs (non-fungible tokens) inspired or obtained from existing intellectual property without the permission of the copyright holder is likely to qualify as counterfeit.. The immaterial nature of the transaction did not change anything at this point.

Also read: The importance of creating a Social and Economic Committee website

So rules of law exist to control this new commercial space where avatars talk and behave like humans. Not sure so there needs to be a new law or a new regulation in Europe. But once again, technological advances are forcing us to rethink the use of existing legal tools.

Anne Cousin

Fellow Herald attorney and specialist in digital law, advice and litigation. He regularly advises e-commerce players on sector issues.

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