We have recently spent time living in virtual reality and part of that is exploring the legal or regulatory aspects. Virtual reality law and regulation is a developing area of law.
Michalsons now has virtual offices
Michalsons now has virtual offices and we try to meet in virtual reality whenever we can. Please contact us if you’d like to meet in our virtual offices. There are pros and cons to real, online or virtual meetings. It’s important to pick the right type of meeting for the interaction you want to have.
We’ll live in a world of mixed reality
We’re headed towards a world of mixed reality, which will be on the spectrum with virtual on one side and real on the other side. Augmented reality (AR) and mixed reality (MR) come somewhere in the middle. There are clear signals that we are moving into a world of mixed reality. For example, Facebook has re-banded Meta. Microsoft has acquired Activision and Apple is soon to launch its headset.
Virtual reality law and regulation
Are there virtual laws? What laws apply in the virtual world? How are we going to regulate digital reality? These are all the important questions that we need to find answers to pretty quickly.
There isn’t currently a Virtual Reality Act (like the Artificial Intelligence Act) and we doubt that they ever will be. This is largely because existing laws are often drafted to be technology agnostic and principal based in a way which makes them applicable to the virtual world. In addition to the existing laws that apply, the owners of virtual worlds often draft terms and policies that would apply to anyone living in their virtual world. Let us look at a few examples of how existing laws would be applied in virtual reality.
- An avatar is probably a natural person under existing laws and not a juristic person. It also wouldn’t be a robot person which is really a new kind of person the law needs to introduce. We don’t believe it’s necessary to create the concept of a virtual person.
- A virtual contract concluded in virtual reality would be with legal force and effect in most jurisdictions. However, the place where the contract is concluded could pose difficulties.
- A virtual signature probably would be a form of electronic signature that most jurisdictions recognise as having legal effect.
- Virtual evidence would be a form of electronic evidence. Many countries are trying to update the laws to apply more specifically to electronic evidence.
- A crime committed in virtual reality would be the type of cybercrime and therefore any cyber crimes would apply and people could be convicted of those crimes under existing laws.
- It is possible to administer companies in virtual reality. For example, the laws of many countries enable a board meeting to be held in virtual reality.
Why not hold your next board meeting in virtual reality?
Privacy and security in virtual reality
How private and secure is virtual reality? Could somebody be listening in to my conversation? Data protection law applies to virtual reality as it applies to any form of processing personal data. Data protection law is principle-based and technology agnostic and therefore applies quite well in a virtual world. Virtual reality is only as private and secure as the owner of the world makes it. It is therefore very important to check the policies and the terms of the owner of the world.
How safe is digital reality?
It is pretty safe for the real person. The providers of headsets have built many great safety features into the products. People can keep themselves safe by setting virtual boundaries and by being able to look through the headset at the real world.
But people can suffer harm whilst they’re in virtual reality. Recently a female avatar has been sexually assaulted and it is possible that a person would be exposed to illegal or harmful material whilst in virtual reality. People can commit crimes against other people in virtual reality.
- Someone could steal someone else’s virtual or incorporeal property.
- A fraudster could also defraud somebody in virtual reality – virtual fraud is an example of cyber fraud.
- A bully can virtually bully their victim much like they can in the real or cyber world.
Both existing laws and the owner of the world, through the terms and policies, play a vital role in keeping people safe whilst they are in virtual reality represented by their avatar.
Intellectual property rights will be critical
A critical issue will be who owns the rights to virtual or intellectual property created in virtual reality.
- Who will own the metaverse – the virtual world itself.
- How will brand licensing work? There is certainly a massive brand opportunity in virtual reality. Virtual products can be mass produced like never before.
- Who will own the content created in virtual reality – think NFTs, memes, diagrams, drawings, songs or images.
- Will real people be able to enforce their personality rights (aka publicity rights) in virtual reality? What if someone else creates an avatar that looks like them?
Do consumer protection laws apply in virtual reality?
Almost certainly yes, but lawmakers might need to adapt them. How will companies deliver information or advertising in the virtual world? How will people hold a business accountable for the sale of virtual goods or services? Will the cooling-off periods that apply to e-commerce also apply in virtual reality? Probably yes.
Actions you can take
- Experience a virtual meeting by asking to meet with us in our virtual offices, by attending one of our live public webinars or by asking us for a recording of our last webinar.
- Help the relevant people in your organisation consider the legal aspects of living in virtual reality by asking for us to conduct a private workshop for your organisation.
- Protect your rights in virtual reality by asking for our advice about virtual reality law.