Intellectual property rights in virtual worlds

Intellectual property rights (IP rights) are legal rights that protect creations of the human mind or intellect. These allow creators (inventors, artists or rightsholders) to decide how, when and where their creations can be used, reproduced and distributed. These rights incentivise innovation and creativity by providing creators and inventors with the means to benefit from their creations and inventions. Just like intellectual property is relevant to creations in the real world, it is also relevant to creations in the virtual world.

There are several types of intellectual property rights, including:

• Industrial property, which includes patents on new inventions, trademarks, industrial designs and models, and geographical indications;
• Copyright and related rights, which protect creative works, including literary works, artistic works, and musical works.

As indicated by the European Union Intellectual Property Office (EUIPO), virtual worlds raise questions in relation to IP protection and to the creators’ ability to retain control over certain activities that involve their creations.

A famous example of trademark rights infringement in virtual worlds are “MetaBirkins”. In this case, a luxury brand took legal action against a digital artist for making and selling digital versions (in the form of non-fungible tokens or NFTs) of their signature handbag. It is important to understand that if you acquire a NFT, you will own the metadata or software code for holding it in your digital wallet and sell it, but not necessarily the rights over the work or the trademark. For this reason, you should carefully check the specific terms and conditions of each virtual world platform, and make sure they are clear and precise about the rights the NFT grants you.

The above case, even though related to the use of new technologies, could ultimately be decided based on existing legal principles. There are some other questions however, that will most likely need further study in the future, for instance, whether a physical product and its virtual counterpart can always be considered similar for trademark registration and enforcement purposes.

For this reason, the Commission Recommendation (EU) 2024/915 on measures to combat counterfeiting and enhance the enforcement of intellectual property rights, which was adopted in March 2024, encourages IP rightsholders, IP offices, and other stakeholders to engage in a dialogue with the Commission on the protection of IP rights, in particular trademarks and designs, including NTFs in virtual environments. 

Copyright and related rights are relevant for both the architecture of virtual worlds (i.e. the software, computer programmes, website designs underpinning virtual worlds) and the works placed in virtual worlds by developers, users or artificial intelligence (e.g. art, avatars, story, music, etc.). If you create a work in a virtual world, such as painting, song, video or animation, such creation in the virtual worlds can also be protected by copyright as long as it is your own original intellectual creation. However, the way in which you can exercise your rights over such creations are usually explained and determined by the terms and conditions of the virtual world platform. It is important that you check those terms and conditions, as they may affect significantly the way you can control and use such creations as well as the revenue that your works may generate on that platform. 

Artificial intelligence (AI) is important for virtual worlds. AI-driven tools can assist in creating and generating vast amounts of content for the virtual worlds, ranging from virtual objects and landscapes to artistic creations. The relationship between AI and copyright is complex. One of the issues it raises is possible protection of AI-generated content. In this context, it is important to understand that the EU copyright law allows a work that reflects an "author’s own intellectual creation" to benefit from copyright protection. As a result, if an AI system generates something such as a poem, a song or code, without involving human creative choices, that work would not qualify for copyright protection. If on the other hand, you are using AI applications as a tool for an artistic creation with your significant personal contribution, such an AI-assisted work is more likely to qualify as a copyright protected work. The answer to the question whether your creative input was significant enough will not always be straightforward and will require a case-by-case assessment based on the individual elements of your work and creative process.

If you want to introduce or upload copyright-protected content created by a third party (for example an image, a song or a video) into a virtual world platform, you need to obtain the authorisation from the rights holder(s). Under EU copyright law, rightholders have the exclusive right to authorise or prohibit the reproduction (copying) or making available of their works, unless relevant copyright exceptions apply. Without such authorisation copyright can be infringed, for instance in case of an unauthorised screening of a movie in a virtual cinema. Therefore, in general, the use in the virtual worlds of the copyright-protected works originating from the real world should only be possible in agreement and with the permission of the copyright holders. 

For more information on IP rights you can visit the website of the European Union Intellectual Property Office (EUIPO). The website includes a section on  Frequently Asked Questions (FAQs) on copyright.