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G2A hits back at Gearbox over 'list of ultimatums'

G2A hits back at Gearbox over 'list of ultimatums'

G2A's Grzegorz Mazowiecki has hit back at the 'list of ultimatums' issued by Bulletstorm: Full Clip Edition partner Gearbox, claiming his company already does everything required of it.

Controversial key reselling marketplace G2A has hit back at Gearbox, the company's partner on Bulletstorm: Full Clip Edition, claiming that it already meets or exceeds fraud-limiting demands made in the face of public outcry - apart from the biggest and most important: giving developers a means to find and de-list fraudulently obtained keys.

Best known for its key reselling market, despite recent moves into direct publishing, G2A is a controversial service which allows users to resell excess game keys - typically in direct contravention of publishers' stated terms and conditions for their use. While in theory this allows individuals to make use of their rights under the doctrine of first sale to convert unwanted gifts into cash or alternative games, the site is more commonly used as a grey market for resellers to buy up keys cheaply in one region then resell them at a profit in another, or to buy keys with stolen credit cards, or steal them directly from publishers or retailers, then sell as many on as possible before the publishers catch wind and cancel the keys.

Despite recent moves to reduce fraud on the platform, G2A remains troublesome in the eyes of many. There should be no surprise, then, that when Gearbox announced it had partnered with the site on the release of a physical collector's version of Bulletstorm: Full Clip Edition there was uproar - in particular from YouTube gaming personality John Bain (TotalBiscuit), who declared a boycott on all Gearbox products as a result. Gearbox responded to the wave of negative publicity that resulted quickly and clearly, issuing demands that G2A clean up its act then announcing it was dissolving the partnership when the company remained silent.

Now, though, G2A has broken that silence, and the company is clear: It's done nothing wrong and has, in fact, already met or exceeded all of Gearbox's demands. 'It all began with a few negative reactions from some YouTubers, and in particular from John “TotalBiscuit” Bain, to an announcement that G2A.com is working together with Gearbox Publishing. Our partner, Gearbox Publishing, unfortunately decided to publicly publish a letter with a list of ultimatums, without consulting us about the truth of the allegations made by John Bain,' G2A's Grzegorz Mazowiecki has claimed in an official statement. 'This is an excellent example that rash actions, without full knowledge of the facts, can be harmful to both the developer and the marketplace. Especially since all of the requests made of G2A.com in the ultimatum have in fact long been part of our marketplace.'

In its rebuttal, the company defends its G2A Shield service in which buyers can pay extra to protect their keys against being cancelled due to reported theft or fraud, claiming that even without a Shield subscription cases of fraud are resolved in a matter of hours with the support team doing 'everything they can to bring about a satisfactory resolution for both [buyer and seller'. It also excuses what Gearbox described as 'hidden fees' by saying that said fees, region-dependent VAT and payment method surcharges, are independent of G2A and outside its direct control.

In a more controversial section of the statement, however, G2A states clearly that it has no intention of ever building Gearbox's requested web service or API for publishers to check for fraudulently obtained keys being listed by sellers - because, the company claims, publishers would only abuse such a service. 'We fundamentally value and respect the right to a free market operating within the law. The law does not prohibit the sale of digital goods by those who have acquired them legally,' Mazowiecki explains. 'If someone does not agree with the above points, then we will unfortunately never reach an understanding.

'The problem is that some developers do not want to accept that people resell their games. The developers would like to control the market and all the sales channels within it, imposing higher prices and prohibiting the resale of unused games. G2A.com does not agree with this – we respect the buyers’ rights, buyers who often unfortunately believe that the rules set forth by developers follow the law. This is why G2A will not give developers with whom we have not signed an agreement unlimited access to and the ability to modify our databases.
'

While Mazowiecki claims G2A 'currently cooperates with all interested developers to ensure only legally acquired keys are sold,' he admits that direct access to the G2A database is already available exclusively to developers which pay a subscription to access the company's Direct publishing programme - because 'we have complete confidence that they will not do anything which would contradict the two above-mentioned facts.'

Gearbox has not yet responded to G2A's rebuttal.

8 Comments

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Aterius Gmork 11th April 2017, 11:21 Quote
[..]'hidden fees' by saying that said fees, region-dependent VAT and payment method surcharges, are independent of G2A and outside its direct control.

Games have always been subject to VAT in the EU. Check for tax on your Steam invoices, it's listed. Either G2A didn't pay their due taxes in Poland or they are trying to make a quick buck that ammounts to about a fifth to a quarter of the sale price. Digital goods have to be taxed in the country of the buyer, not the seller (if sold commercially). However they are not taxed twice: The tax rate of the buyer, not the seller is applied.
Gareth Halfacree 11th April 2017, 11:30 Quote
Quote:
Originally Posted by Aterius Gmork
Games have always been subject to VAT in the EU. Check for tax on your Steam invoices, it's listed. Either G2A didn't pay their due taxes in Poland or they are trying to make a quick buck that ammounts to about a fifth to a quarter of the sale price. Digital goods have to be taxed in the country of the buyer, not the seller (if sold commercially). However they are not taxed twice: The tax rate of the buyer, not the seller is applied.
Perhaps it's just too close to lunch, but I'm not sure what point you're making: G2A says that one of the only two 'hidden' fees is when someone from the UK pops a $10 key in their bag and then it gets a 20% VAT charge added at checkout, or someone from Lithuania gets a 21% VAT charge added, or from wherever gets whatever VAT charge added - which is exactly what you're saying should happen: 'The tax rate of the buyer, not the seller is applied.'

There are plenty of reasons to dislike G2A, but I've seen no evidence they're not applying and paying VAT properly.
Aterius Gmork 11th April 2017, 13:05 Quote
Sorry, I should have made myself clearer:

On Steam the price advertised is the price you will pay, including VAT. Say Bulletstorm is advertised at £50 on Steam - you'll pay £50: £41,66 for the game and an additional £8,34 of taxes.

G2A used to be the same: The price you see is the price you pay. Now they hit the advertised price with an additional tax, in your case 20%. So for our previous example you'd end up paying not £50 but £60.

The way they suddenly add the tax on the advertised price is shady. If the game sold is subject to VAT now it has been subject to VAT before this new ruling - only Polish tax rates and not UK ones. Which are higher at 23% btw.
Gareth Halfacree 11th April 2017, 13:10 Quote
Quote:
Originally Posted by Aterius Gmork
The way they suddenly add the tax on the advertised price is shady.
Now I understand! Aye, if you're not B2B then you should always display VAT-inclusive pricing - in fact, UK law requires it.
Aterius Gmork 11th April 2017, 13:15 Quote
Interesting. And if you are B2B - which G2A claim their market is - you are not subject to VAT anyway. Only the G2A service charge might be subject to VAT, the same way the ebay service charge is.
Mankz 11th April 2017, 13:28 Quote
The Robin Hood defense of saying 'developers overcharge and people wont pay it' and 'were providing a useful service' doesn't really wash when you're taking a cut and not stamping down on something that's obviously stolen...

If something costs £100 in a shop, but is going for £60 still 'brand new' down at the car boot sale, you can safely assume something dodgy has gone on somewhere...
damien c 11th April 2017, 13:48 Quote
Quote:
Originally Posted by Mankz

If something costs £100 in a shop, but is going for £60 still 'brand new' down at the car boot sale, you can safely assume something dodgy has gone on somewhere...

Not always for example I paid £50 for a tank for my Ecig from a shop, now if I had, had the money I could have paid £220 and bought 10 of them from a place that I know, and they are legit.

So I could have had 9 to sell at a car boot and could have sold them at £35 each and made myself £315 in total minus the initial purchase cost of £198 for the 9 which would have gave me £117 profit if they all sold which they would have.

Whilst I probably wouldn't get in to the CD Key selling business I am looking at other things as my brother runs his own business online and I am looking, to join him selling certain items cheap and not because they are dodgy but because I know I can sell certain items cheap enough to make a small amount of profit and build up a customer base for repeat custom but it will take quite an investment upfront which currently I cannot do.

Just because something is cheap does not mean something dodgy has happened to acquire the item(s).
fix-the-spade 11th April 2017, 18:06 Quote
To be fair to Gearbox, if I had a ten foot guy in a luchador mask telling me not to do something I'd probably do as he said too.
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