SOME ISSUES OF REGULATION OF CYBERSPORT AND BUSINESS ACTIVITIES IN IT

This article aims to consider some issues of regulation of the cybersport industry, to analyze its fragmentation and diversity, giving examples of the most popular games, the main parties involved in this industry: players, teams, organizations, leagues, publishers. The article attempts to determine the legal framework and regulation of e-sports based on international experience. The author, considering e-sports as a business, notes an unusually accelerated product life cycle, the opportunity to work on a franchise, a variety of potential business partners, as well as the prospects for investing in this industry. Thus, it is concluded that cybersport is a new phenomenon and is currently a developing area of sports. This sport has its supporters and opponents; there are those who does not classify cybersport as a sport as such. However, today e-sports is a powerful industry that is actively developing around the world, brings significant income, and shows the need for comprehensive legal regulation.

VOLUME 3 ISSUE №1 E-ISSN: 2181-1024 A P R Volume I L1 (2022) 3, Issue 2022 TSUL Legal Report 1

12.00.02 – CONSTITUTIONAL LAW. ADMINISTRATIVE LAW. FINANCE AND CUSTOMS LAW

TSUL LEGAL REPORT INTERNATIONAL ELECTRONIC SCIENTIFIC JOURNAL

Rustambekov Islambek Rustambekovich Deputy Rector on Academic Affairs, Tashkent State University of Law, Doctor of Law, Professor

Salaev Nodirbek Saparbaevich Deputy Rector on Research and Innovations, Tashkent State University of Law, Doctor of Law, Professor

Latipov Samir Ildusovich Director of the Center for Legal Initiatives and Innovations, Tashkent State University of Law

Nematov Jasur Aminjonovich Professor of the Tashkent branch of the Russian University of Economics named after GV Plekhanov

Umarkhanova Dildora Sharipkhanovna Dean of the Faculty of International Law and Comparative Legislation, Tashkent State University of Law, Doctor of Law, Associate Professor

Abzalova Khurshida Mirziyatovna Acting Professor of the Department of Criminal Law, Criminology and Anti-corruption, Tashkent State University of Law, Doctor of Law

Nematov Jurabek Nematulloyevich Acting Professor of the Department of Administrative and Financial Law, Tashkent State University of Law, Doctor of Law

Akhmedova Guzalkhon Utkurovna Associate Professor of Criminalistics and Forensic Examination Department of Tashkent State University of Law, Doctor of Law

Ergashev Ikrom Abdurasulovich Head of Scientific Department, Tashkent State University of Law, Associate Professor, Doctor of Philosophy in Law.

Yusupov Sardorbek Bahadirovich Head of the Department of Administrative and Financial Law, Tashkent State University of Law, Associate Professor, Doctor of Philosophy in Law

Gafurova Nozimakhon Eldarovna Head of the Department of International Law and Human Rights, Tashkent State University of Law, Associate Professor, Doctor of Philosophy in Law

E-ISSN: 2181-1024 Volume 3, Issue 1 (2022) TSUL Legal Report 3

Khujaev Shokhjakhon Akmaljon ugli Head of Intellectual Property Law Department, Tashkent State University of Law, Doctor of Philosophy in Law

Uzakova Guzal Sharipovna Head of Environmental Law Department, Tashkent State University of Law, Associate Professor, Doctor of Philosophy in Law

Turdiev Khayitjon Usmonkul ugli Acting Associate Professor of the Department of Theory of State and Law, Tashkent State University of Law, Doctor of Philosophy in Law

Ramazonova Nargiza Abdirashidovna Head of the International Relations Department, Intellectual Property Agency under the Ministry of Justice of the Republic of Uzbekistan, Doctor of Philosophy in Law

Kurbanov Maruf Mamadaminovich Acting Associate Professor of the Department of Criminal Law, Criminology and Anti-corruption, Tashkent State University of Law, Doctor of Philosophy in Law

Narziev Otabek Sadievich Acting Professor of International Private Law Department, Tashkent State University of Law, Doctor of Philosophy in Law

Pirmatov Otabek Shavkatovich Acting Associate Professor of the Department of Civil Procedural and Economic Procedural Law, Tashkent State University of Law, Doctor of Philosophy in Law

Yakubova Iroda Bakhramovna Acting Associate Professor of Intellectual Property Law Department, Tashkent State University of Law, Doctor of Philosophy in Law

Shamsutdinov Behruz Sadriddin ugli Head of the Department of Commercialization of Scientific and Innovative Projects, Tashkent State University of Law

Saydakhmedov Umid Murodovich Judge for Economic Affairs, Tashkent Regional Court, Doctor of Philosophy in Law, Associate Professor

4 TSUL Legal Report Volume 3, Issue 1 (2022) E-ISSN: 2181-1024

Contacts Editorial office address: Tashkent, st. Sayilgoh, 35. Index 100047. Principal Contact Tel.: ([phone number hidden] Fax: ([phone number hidden] E-mail: info@legalreport.tsul.uz

© 2022. TSUL – Tashkent State University of Law. All rights reserved.

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12.00.02 – CONSTITUTIONAL LAW. ADMINISTRATIVE LAW. FINANCE AND CUSTOMS LAW

IKHTIYORJON TURABOEV, IKROM ERGASHEV Tax monitoring in Uzbekistan: problems and issues ............................................................8

DILMURODJON RAKHIMOV Organizational and legal issues of gender equality in the civil service .............................. 15

NOILA NURMAMATOVA Mechanism of appeal to the Constitutional Court .............................................................. 23

ILHOM NOROV Problems of public service in the Republic of Uzbekistan: further improvement of the public service system .............................................................................................. 30

12.00.03 – CIVIL LAW. BUSINESS LAW. FAMILY LAW. INTERNATIONAL PRIVATE LAW

BEGALI XOLMIROV The concept, importance and characteristics of electronic currency ................................. 37

MUHAMMAD ALI RAMAZONOV The concept and essence of cryptocurrency ..................................................................... 44

PARIZODABEGIM MUKHAMATKULOVA Some issues of regulation of cybersport and business activities in IT .............................. 51

12.00.04 – CIVIL PROCEDURES LAW. ECONOMIC PROCEDURES LAW. ARBITRATION PROCESS AND MEDIATION

ABDUMURAD KHAKBERDIEV Types of arbitration courts and their classification ............................................................. 57

DONIYORBEK DАVRONOV Procedure and basis for application of procedural coercive measures ............................. 68

12.00.08 – CRIMINAL LAW, CRIME PREVENTION. CRIMINOLOGY. PENAL LAW

BUNYOD ISLOMOV Mitigating factors and criminal defenses in criminal legislation of the Kingdom of Norway (comparative analysis) ...................................................................... 78

JALOLIDDIN HAYDAROV Qualification of crimes of torture and other cruel, inhuman or degrading treatment ......... 88

6 TSUL Legal Report Volume 3, Issue 1 (2022) E-ISSN: 2181-1024

12.00.09 – CRIMINAL PROCEDURE. CRIMINOLOGY, OPERATION SEARCH LAW AND FORENSIC EXAMINATION

SARBON URALOV Specific aspects of proof ................................................................................................... 96

KHAYDARALI YUNUSOV Contributions of Central Asian scholars to the development of islamic sciences: Sarakhsi – founder-father of international law ................................................................ 103

DJAMALIDDIN MUSAEV Principles of international cooperation in the field of preventing illicit trafficking in narcotic drugs, psychotropic substances and precursors . ........................................... 111

SHAHNOZA ALMOSOVA The essence of parallel import and problems of its regulation in the Republic of Uzbekistan . .................................................................................................. 121

USMON ALIEV Problems of reforming the UN security council and improving its effectiveness ............. 127

DALER VALIJONOV International legal cooperation of the prosecutors bodies against corruption ................. 134

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12.00.03 – CIVIL LAW. BUSINESS LAW. FAMILY LAW. INTERNATIONAL PRIVATE LAW

SOME ISSUES OF REGULATION OF CYBERSPORT AND BUSINESS ACTIVITIES IN IT

Mukhamatkulova Parizodabegim Mamatjonovna Master’s student, Tashkent State University of Law E-mail: parizodabegim.mukhamatkulova@mail.ru ORCID: 0000-0002-0693-6630

Keywords: cybersport, This article aims to consider some issues of regulation

e-sportsman, E-Sports, game, business, investor, franchise, investment, industry.

of the cybersport industry, to analyze its fragmentation and diversity, giving examples of the most popular games, the main parties involved in this industry: players, teams, organizations, leagues, publishers. The article attempts to determine the legal framework and regulation of e-sports based on international experience. The author, considering e-sports as a business, notes an unusually accelerated product life cycle, the opportunity to work on a franchise, a variety of potential business partners, as well as the prospects for investing in this industry. Thus, it is concluded that cybersport is a new phenomenon and is currently a developing area of sports. This sport has its supporters and opponents; there are those who does not classify cybersport as a sport as such. However, today e-sports is a powerful industry that is actively developing around the world, brings significant income, and shows the need for comprehensive legal regulation.

appropriate technical means, entities that

Currently, the Internet is actively and rapidly developing and new relationships are emerging in cyberspace. As a rule, the Internet is understood as a computer (information) network that connects, through enter into legal relations with each other, exercising rights and incurring obligations [13]. Various relations arise on the Internet, in particular, of a civil law nature [14]. It can

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be noted that such relations also include cybersport, that is, the sports gaming industry on the Internet.

Thus, with the development of the sports industry, its turn to the entertainment of sports events, the desire for commercialization and, simultaneously with the high growth of information technology, a transformation of all types of sports activities is observed. Against the backdrop of ongoing events, cybersport has received an impetus to develop as a business.

As computer sports develop, new monetization methods are introduced and improved [1]. The number of local and regional events and cybersport leagues is increasing every year. One of the largest cybersport organizations in the world hosting cybersport competitions is the Electronic Sports League (ESL). ESL was founded in 2000 and over 20 years has grown into the world’s largest cybersport company, which today leads the industry in the most popular online and offline competitions. They run high quality branded international leagues and tournaments. These include ESLOne, Intel® Extreme Masters, ESLPro League, as well as national ESL championships, grassroots cups and matches [2].

Research results and discussion Due to the global pandemic of the COVID-19 coronavirus, the global sports community is forced to cancel sports competitions at all levels, including the Olympic Games and the European Football Championship, the development of e-sports around the world is of tremendous importance.

A significant role will be played by the formation of a successful competitive brand in computer sports. This is explained by the fact that it is the strongest brands that are able to attract the largest number of stakeholders, which, in turn, significantly affects the distribution of power in the business.

For example, in 2017, Alibaba signed an 11-year, $1 billion deal with the International Olympic Committee to become a major sponsor of the Summer and Winter Olympics. Other sponsors include game developers such as Riot and Blizzard, tournament organizers such as the ESL Gaming Network, and companies associated with commercial products including Red Bull, LG, and Logitech Gaming. Sponsorship and advertising currently generate about 75% of cybersport revenues [3].

According to Newzoo’s Global Esports Market Report, cybersport generated about $700 million in revenue, based on a global audience of almost 400 million people. 2020 revenue is projected to be $1,500 million. To date, the largest prize pool in cybersport has been provided by the 2016 Dota 2 International Championship tournament, which totaled $20 million. The winning team took home nearly $10 million and over $1.8 million each [4].

The cybersport industry includes not only traditional sports-related games such as NBA2K and FIFA [5] but also, more importantly, games such as League of Legends, Counter-Strike and Dota. As we’ll discuss later, individual players can either stream their games to earn money or join larger organizations to compete for big cash prizes. Players can connect with their fans in a variety of ways, including social media, live streaming platforms, and faceto-face tournaments. On the other hand, fans can watch their favorite teams perform in regional and global tournaments. Many technology platforms, services, events, analytics platforms, and significant investor capital surround this ecosystem as it grows [6].

To the surprise of traditional sports fans only, cybersport was recently recognized as the official medal “demonstration” sport at the upcoming 2022 Asian Games in Hangzhou, China [7]. The move, promoted by the Olympic Council of Asia (OCA) and backed by the commercial power of Chinese retail chain Alibaba, confirmed the emergence of cybersport as a full-fledged sport with both a huge player base and a lucrative professional layer. Its development

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also marked an important transition for the nascent sport, which quickly moved from the homes of most players to the global online marketplace.

China is the largest cybersport market, with most of its revenue coming from sponsorships and digital goods. The second largest is the cybersport market in North America, the third is Western Europe.

The popularity of cybersport in developed countries is growing dramatically, faster than any sport in history. Cybersport inspiring results underline its astonishing growth: professional leagues, international competitions, college and university scholarships, investments from major professional sports team owners, exclusive streaming and digital rights deals, significant commercial sponsorships, generous prize money, and a growing elite roster of professional players earning up to seven figures. All of these developments have come about because cybersport has materialized in tandem with a new generation of participants, spectators and sponsors, inimitably attracted by the fusion of technology, games, tribalism and, of course, commercial opportunities [8].

Mobile devices are becoming more and more popular along with computers. In many markets, especially in Southeast Asia, mobile games are gaining popularity, and tournaments are being held for such games. Undoubtedly, this is no less powerful source of income than classic computer sports.

Cybersport is booming in regions such as Southeast Asia, Japan, and Latin America, while closing the gap with more mature cybersport markets.

Undoubtedly, computer sports is a fundamentally new phenomenon in the Uzbek market. Despite the fact that computer sports appeared at the world level in the early 2000s, this sport reached our country in the mid-2010s, and was officially recognized as a sport only in 2018. The high interest in this sport among young people can be explained by the active entry into the market of the so-called Generation Z, which has been associated with digital technologies since early childhood. It is they who are the most active consumers of the computer games market, and it is the representatives of this generation that become cybersportsmen [9].

Recently, the number of people involved in computer sports at a professional level has significantly increased in our country.

Older people also show interest in computer sports, but the percentage of such people is much lower.

As the professional level of competition in cybersport emerges, all the problems associated with commercial dividends appear:

1. ESL has announced plans to implement an anti-doping program after one of its most senior players admitted the use of a cognitive enhancer and pharmaceutical drug Adderall during competition. With a $250,000 prize pool available to enter the competition, this exceptional recognition may very well be just the tip of the cognitive-enhancing drug iceberg.

2. Gambling around cybersport remains unregulated. One can only guess to what extent the temptation to change the rules of the game and other forms of corruption have penetrated the growing ranks of this sport.

3. Like tech start-ups, the infamous tech boom, and the subsequent dot-com crash of the early 2000s, cybersport is vulnerable to excessive effort in trying to capitalize on seemingly exponential commercial inflation. The business models governing sports monetization remain underdeveloped and largely experimental.

4. Cybersport make it hard to manage. Fragmentation abounds as new federations and competitions take hold, usually clustered around specific games. No one really knows if cybersport will end up being represented by overarching governing bodies, or by a more stratified game, community, geographic location, or stakeholder connection.

The main parties involved in the industry are:

1. Players. Becoming the best esportsman is not an easy achievement. To climb the ranks, players specialize in a particular game,

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developing their skills in a vast competitive game. Talented players have two options for developing a cybersport career: – Streaming: Gamers who stream live while playing video games are called “streamers”. This is usually done in a regular game. For example, the world’s most popular YouTube channel is owned by a video game streamer who goes by the name “PewDiePie”. He has such a polarizing style that viewers often find him “very adorable or incredibly annoying”. In 2015, with a base of over 57 million YouTube subscribers, he earned $7.4 million; - professional game: few who have risen to the professional level compete in tournaments around the world against the best teams. Successful professional players can earn six-figure salaries or even millions. The best players often start their professional careers at the age of 16 or 17 and then retire around the age of 24. 2. Teams. Professional players team up (in multiplayer games) or play alone (in 1v1 games) to compete for cash prizes. Each team specializes and participates in one specific game such as League of Legends, Dota or Counter-Strike. The teams participating in these tournaments have millions of Twitter followers, millions of viewers online and tens of thousands of viewers following them in person in tournaments. 3. Organizations. The best cybersport teams are recruited to work within organizations, they have multiple teams that specialize in their video games but operate under the same name (such as Cloud9, NRG, TSM, Optic Gaming or Fnatic.) - just like an NCAA college or university competes in football, basketball, and hockey under the same parent organization (college or university). 4. Leagues. Cybersport teams representing the organization they are a part of will compete in their respective video game league, hosting regular seasons, playoffs and world championships. League tournaments are hosted by companies such as Major League Gaming (MLG) or Electronic

Sports League (ESL). Leagues include the North America League of Legends Championships Series, Call of Duty World League (organized by MLG), or Pro League for CS:GO (organized by ESL) [10]. 5. Publishers. In cybersport, each game is the intellectual property of the game’s creator, collectively referred to as the “publishers”. These publishers include Riot Games, Valve, Activision, and others. The publisher dynamic in the cybersport ecosystem can be considered “omnipotent”. Unlike traditional sports that can be played by anyone, anywhere, publishers create and develop their games and subsequently own all the rights to them. This means they have rights to where the game is played, who can host video game tournaments, and more. Nowadays, the e-sports market is developing quite quickly, and along with the development, certain systems come along, according to which profits are distributed. It was not always so. Previously, all companies and gamers earned either separately or together. It is this fact that shows that before, in fact, the gamer had to work for himself and finance himself. Since in the past players or leagues that signed with a big company actually gave away a large percentage of the winnings to the company, the best solution would be to switch to a franchise system. The essence of the franchise is that the league will share the profits with players or entire teams. Another important factor is that in order to stay in the league and participate in subsequent, future tournaments, you must pay certain entry fees. These contributions are made by the company from which the players or leagues will participate. Sports clubs, companies or private entrepreneurs have become investors in cybersport teams. And almost all the profit that the tournaments offer, which offers a profit of almost 4 million dollars, will go to investors [11]. And that is why further we will consider such a type of entrepreneurship in the world

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of e-sports as investments. In fact, many entrepreneurs decide to invest in cybersport from the wrong point of view, namely, to invest, develop a system, sell a product, make a profit. So, today, the creators of gaming devices and special equipment work with cybersportsmen; developers of electronic keys for games; online platforms and casinos; banks; energy drink manufacturers. Investor work schemes are different and depend on the specific case: from sponsoring a gamer with equipment and clothing to developing a complex of sponsorship, advertising, speaking at matches, interviews and broadcasting games [12]. Conclusion Summarizing the above, we can say with confidence that computer sports is a fairly young and currently developing area of sport. This sport has its supporters and opponents, there are those who do not consider computer sports to be sports as such. However, today cybersport is a powerful industry that is actively developing around the world and brings in significant income.

The computer games industry plays a significant role in replenishing the country’s budget, since the contracts concluded between players and companies amount to billions of US dollars. The continued recognition of cybersport as a specialty sport in more and more countries, as well as the introduction of cybersport discipline into the program of the Olympic Games, contributes to the growth in the earnings of players and the attractiveness of cybersport by entrepreneurs. Moreover, incomes are not limited only to holding gaming competitions. This includes the organization of performances, concerts, sponsorship, advertising, merchandise trade, online broadcasts on TV and the Internet, and much more. At the moment, there is no unified legal regulation of cybersport events. These are carried out on the basis of the current legislation of the country in which the competition is held, and mainly take place on the basis of commercial relations. Therefore, further popularization of e-sports and amendments to the current legislation of the country are required.