Modding in EULAs and contracts – what applies legally in Germany?

Mods add new content to video games, improve graphics or add completely new ways of playing. Hardly any major PC title today can do without an active modding community – from Skyrim to Minecraft to Grand Theft Auto. These fan-created modifications enrich games and engage the community, but also raise legal questions. Can a player modify a game at all? Who owns the content of a mod? And what can developers do to allow or restrict modding? In the following, we take a look at the legal basis under German law and how end user license agreements (EULAs) and special agreements with modders regulate these questions.

Modding and copyright: Why changes to the game can be problematic

From a purely technical point of view, a mod is nothing more than the modification of an existing game or the addition of third-party content. From a legal perspective, however, modding encroaches on the game developer’s copyright. Under German law, computer games are comprehensively protected as so-called multimedia works by the Copyright Act (UrhG) – including program code, graphics, sound and story. Changes to such a protected work are deemed to be an adaptation or redesign.

According to Section 23 UrhG, adaptations of a work may only be published or distributed with the consent of the copyright holder. This means that publishing a mod without the permission of the copyright holder is generally illegal. Even if fans usually develop mods free of charge and out of passion, this hardly plays a role for copyright law. A general exception such as the “free use” previously enshrined in the law practically no longer exists today. Only very special cases – such as a satirical parody or pastiche in accordance with Section 51a UrhG – could justify a mod without consent. However, most common mods (new quests, improved graphics, additional items, etc.) are not covered by this, but infringe the exclusive rights of the developer without permission as soon as they go beyond private use.

It is also important that a mod is often based on the original game. Even if modders create all the new graphics, models or sounds themselves, they still use the engine, game world or gameplay elements of the original game. Without the main game, the mod usually does not run at all. From a legal perspective, the mod therefore remains a dependent, derived work. The modder may have copyrights to their own created content – but in order to use and distribute it within the game, they need the consent of the original developer. Otherwise, the developer could prohibit the distribution.

Personal rights of the author also play a role in connection with mods. In Germany, the author of a work has the right to prohibit distortions or gross alterations to their work (Section 14 UrhG, “Preservation of the integrity of the work”). Theoretically, a game designer could therefore argue that a certain mod distorts their game in an unacceptable way – for example by drastically brutalizing a family-friendly game through a mod. In practice, developers rarely make use of this, especially if they already have economic control. Nevertheless, it is important to bear in mind that mods with problematic content (e.g. unconstitutional symbols, extreme violence in a game for young people, pornographic elements) can not only damage the image of the game, but may also be banned by the creators or authorities.

In summary, copyright law creates a clear starting position: nothing works without permission. Every mod is only “tolerated” legally as long as the rights holder allows it. Developers therefore ultimately decide which mods live and which die – and they have the right to prosecute infringements of their intellectual property. However, they also have the freedom to deliberately allow or encourage mods. How is this permission granted? This is where contractual regulations come into play, in particular EULAs and special modding agreements.

End user license agreements: Prohibit or allow modding?

The end user license agreement (EULA) is the central legal tool used by game providers to define the rights of use for a game. Every player agrees to such a contract (often in the form of general terms of use) when installing or launching the game for the first time. In it, the developer can clearly regulate whether and to what extent modding is permitted.

Some games take the hard way and clearly prohibit modding in the EULA. Typical wording in such contracts reads: “The user is prohibited from making changes to the game without the manufacturer’s authorization” or “Reverse engineering, decompilation and modifications are not permitted unless expressly permitted by law.” Online games in particular often contain clauses that prohibit any intervention in the client or game files – usually to prevent cheating or to protect the integrity of the online experience. If a player nevertheless mods and thus violates the EULA, the provider can take contractual action against them. In practice, this primarily means that the account can be blocked or terminated due to a breach of contract. An extreme example of rigorous enforcement is Nintendo, which consistently has even harmless fan projects for its games shut down by means of cease-and-desist orders – both with reference to the EULA and directly with copyright action.

Interestingly, even the EULAs of some modding-friendly developers contain strict prohibitions at first glance. This is often for strategic reasons: The developer wants to secure a handle in case of emergency. One example is Paradox Interactive, known for its highly moddable strategy games. In some versions of the Paradox EULAs, it was stated across the board that no changes may be made to the game, which unsettled the community – in fact, Paradox supports mods and offers official modding tools. The company’s aim here was to be legally protected in order to be able to intervene in case of doubt (e.g. against harmful mods), although everyday mods were tolerated. Communicating such clauses is tricky: Developers need to make it clear that they allow normal fan mods, but still have “leverage” to take action against abuse in an emergency.

On the other side of the spectrum, many developers specifically use the EULA to allow modding – albeit under certain conditions. For example, a modding-friendly EULA may explicitly state: “The user may modify and add new content to the game as part of mods, as long as these mods remain free of charge, do not contain illegal or disruptive content and are only used by players who own a legitimate copy of the game.” With such clauses, the rights holder gives fans the green light but retains control: commercial use is excluded, illegal or inappropriate content is taboo, and mods should not circumvent the need for a legally purchased original. It is also often made clear that mods may only be created for private use – which implies that distribution may only take place in fan circles and not via official markets.

Another decisive factor is an EULA clause that emphasizes that modders do not acquire any rights to the original game or the underlying IP. The original game remains the full property of the developer, and the mod permission does not mean that the fan extensions are suddenly protected by the modder. Rather the opposite is the case: many publishers secure extensive rights of use to the mods created by players in the EULA. For example, the Electronic Arts (EA) user agreement contains a passage stating that all content created by users and uploaded to EA services (user-generated content) may be used, modified and distributed by the company worldwide, for an unlimited period of time and free of charge. In other words: If, for example, a player publishes a mod or even just a screenshot or a design on an EA platform, they automatically grant EA a license to reuse this material as it sees fit – for example in its own games, in marketing or on other platforms – without having to pay any remuneration or ask the author separately. In such constructions, the players formally retain the copyright to their contributions, but the publisher receives such a comprehensive right of use that it can in fact freely dispose of them. Blizzard recently went one step further: in the terms and conditions for Warcraft III: Reforged, it was stipulated that all user-created “custom games” in Warcraft ultimately belong to the company or can be taken over by the company. This was Blizzard’s way of preventing another mod like DotA from becoming independent without Blizzard having a stake in it.

However, such extremely far-reaching requirements in EULAs and GTCs are not entirely unproblematic from a legal perspective. In Germany, pre-formulated terms of use are subject to review under the law on general terms and conditions (Sections 305 et seq. BGB). Excessively surprising clauses or clauses that blatantly disadvantage the user could be invalid. It remains to be seen whether a clause that assigns all mod content to the developer across the board would stand up in a German court – there is little case law on this so far. Consumers could argue that they are unreasonably disadvantaged by such conditions. On the other hand, most modders voluntarily agree to be allowed to mod in the first place, and many are not bothered by this as they have no commercial interest in their fan works. In practice, disputes over such clauses rarely arise because the fronts are clear: The developer wants to protect himself, the modder wants to be creative and provide for the community without coming into conflict with the rights holder.

To summarize: An EULA can prohibit modding completely, allow it to a limited extent or remain silent, which then effectively amounts to a ban (no permission, no right). From the developer’s point of view, it is advisable not to leave the EULA vague, but to clearly define what is permitted. This way, players know where they stand and the provider has a contractual basis to take action against unwanted activities in case of doubt. However, it is also important not to neglect community communication: strict prohibitions in the terms and conditions should be explained so as not to scare off fans, while permissive clauses should make it clear under what conditions creative freedom is granted.

Tolerance vs. crackdown: Why many developers allow (or at least tolerate) mods

Even if a ban were legally possible, many studios consciously decide to tolerate or even actively promote modding. The reasons are obvious: mods extend the lifespan of a game, keep players interested and provide free content that the developer does not have to produce themselves. A game with a lively modding scene – think Skyrim or Minecraft – often sells for years because new fan content is constantly being released. Player loyalty increases, the brand remains a talking point and a closer relationship develops between the community and the developer. Some mods even eliminate bugs or improve the balance, which benefits the developer. In short: from an economic and PR perspective, mods can be extremely valuable.

On the other hand, aggressive action against modders harbors considerable risks. If a company takes tough action against fan projects, there is a risk of the Streisand effect: public outrage often attracts even more attention to the banned mod project, and the company’s reputation among fans suffers. A prominent example is the case of Nintendo with fan remakes and mods mentioned at the beginning: although Nintendo acts consistently in the legal sense, every strike against the fan community also generates negative headlines and disappointment among loyal supporters. A developer who bans mods across the board must also reckon with a competitive disadvantage: The gaming community could turn away and prefer to support titles where fan creativity is welcome.

Many studios therefore seek a middle way: they allow mods in principle, but reserve the right to intervene in extreme cases. The EULA or separate modding guidelines define what is tolerated and where the limits are. Finding this balance between control and creativity is strategically important for companies. Successful examples show that a clever modding concept has win-win potential: The game remains fresh and is co-developed by the community, while the developer retains its IP rights and keeps the reins in the background.

A differentiated approach can also be graded according to the type of mod. Smaller cosmetic mods (such as interface adjustments, fan-created patches to fix bugs, reskins) hardly harm the rights holder – many developers generously overlook them, even if the license conditions sound strict. As long as such mini-mods have no negative effects, they are usually tacitly tolerated. Larger content mods and add-ons that add new quests, levels or items are even expressly welcomed by some developers, as they enhance the gaming experience. It is worth establishing clear community rules here: “You may mod our game and share mods, but only free of charge, with attribution and without infringing third-party trademarks” – this is often the informal guideline. Although the company reserves the right of veto, it also shows that it values the creativity of its fans.

It often becomes critical with total conversions, i.e. mods that almost turn the game into a new game (new story, world, often new assets, but based on the original engine). Such projects can generate an enormous amount of attention – and thus raise the question of whether they might become competition for the original game. Some developers are relaxed about this: Bethesda has tolerated large total conversion mods for Elder Scrolls or Fallout for many years, as long as they require the original game and are not commercial. The base game often even sells better as a result because it is required. Other rights holders are stricter, especially if the fan conversion is aimed at a similar genre to their own planned products.

Ultimately, every developer has to decide for themselves which modding strategy suits their game. Legally, they can prohibit or allow mods – the challenge is to implement this in such a way that the community goes along with it and the developer’s rights are not diluted. Many rely on the motivation of the fans: as long as modders feel that they are treated fairly and their work is recognized, they are more likely to adhere to the prescribed rules.

Beyond the EULA: modding guidelines and official partnerships

In addition to the general EULA clauses, some studios use special modding guidelines. These are often guidelines published as FAQs or web documents that explain in clear language what fans may and may not do. Although such guidelines are not as legally binding as a contract, they act as a unilateral declaration of tolerance: the developer signals that they allow certain types of mods. For example, Microsoft published a modding FAQ for the Halo Master Chief Collection, which stated: “You may use anything in the game for mods.” This is a very open permission and has given the community the green light to get creative without constantly asking for permission. Similarly, such guidelines often state that cheat tools or inappropriate content are taboo and that mods are used at your own risk (the developer accepts no liability for problems caused by unofficial modifications). For many fans, such clear statements are worth their weight in gold: they know exactly where they stand without first having to interpret legalese from the EULA.

Official modding platforms or workshops of a game go one step further. If, for example, a developer operates an in-house mod upload service (whether via their own website or via partnerships such as the Steam Workshop), there are separate terms of use for this. Typically, when uploading a mod, a modder must confirm that they are not infringing any third-party rights, that they are the creator of the mod content and – most importantly – that they grant the developer a specific license to their mod. This allows the company to host, distribute, perhaps even adapt or remove the mod without getting into legal gray areas every time. Some companies require a simple right to use the mod, while others go further: Blizzard, for example, stipulated (as mentioned above) that all custom games created by users for new Warcraft III content are made available to the company for free use. This is to prevent the creation of mods in which the rights holder is not involved, even though they are based on their game.

However, tact is required: overly aggressive demands (along the lines of “everything you create is completely ours”) can demotivate the modder community. Fans may feel exploited if their years of work on a mod end up being appropriated by the publisher without any consideration or recognition. This is why many choose a more moderate approach: the modder retains the copyright to the mod, but grants the developer an unlimited, free right to use the mod in the game environment. Optionally, it is agreed that the developer may incorporate mod content into future updates, DLCs or marketing material, for example – ideally with the modder’s name mentioned to acknowledge their contribution. This way, the community feels respected, while the rights holder remains free to integrate the best fan ideas into the official game.

In addition to general guidelines and upload conditions, in some cases there are also individual contracts with modders. If a mod is exceptionally successful or suits the developer’s concept, he may try to officially take over or market the mod project. This is where contractual partnerships arise in the true sense of the word: the developer concludes a contract with the modder or the mod team that regulates further use. This can take the form of a license agreement (the modder allows the publisher to use their mod content, possibly exclusively and for a license fee) or as a work contract/assignment, in which the modder is hired as an external developer to integrate their mod into the main game or as DLC. Such a contract specifies, for example, which rights the modder transfers to the developer – such as the transfer of copyrights to the newly created mod elements or at least the granting of an exclusive right to use them. Obligations are also defined: What quality requirements apply? Should the original modder provide future support and updates for the integrated mod? What about remuneration or profit sharing? All of this should be clearly regulated in order to avoid later disputes.

There are several examples of such partnerships: The mod team behind Black Mesa, a total fan reworking of the classic Half-Life, received official permission from Valve to commercially distribute their mod as a standalone game on Steam. Here, of course, it had to be ensured that Valve as the rights holder of Half-Life agreed – which was done – and that presumably a certain revenue sharing or licensing agreement was made. Surprisingly, the developers of Black Mesa were allowed to keep the majority of the revenue, which is rather the exception in the industry and can be seen by Valve as recognition of the fan achievement. Another example: Bethesda has contracted experienced modders as part of the Creation Club to provide new content for games such as Skyrim and Fallout for a fee. This content is then officially released as mini DLCs, with the modders effectively acting as freelancers and receiving a fee. Here too, of course, there are contracts that stipulate that Bethesda receives the full rights of use to the content provided, while the modders are paid in return and named in the credits.

Such steps are particularly worthwhile if a fan creation is exceptionally popular. Some of the world’s best-known games have even originated from mods – think Counter-Strike (originally a mod for Half-Life) or Dota (Defense of the Ancients, a mod for Warcraft III). In these cases, the rights holders either brought the modders on board or – as in the case of Dota – another provider seized the opportunity: Valve snapped up the Dota concept because Blizzard had made no clear claims to it at the time. Today, the positions have been clarified and companies no longer want to leave such cases to chance: They prefer to enter into partnerships with talented modders at an early stage in order to benefit jointly from success rather than lose control.

Conclusion: Create clear rules, enable creativity

Modding is always caught between fan creativity and the rights of the developers. According to German copyright law, the initial power lies with the rights holder of the game – a game may not be modified and publicly distributed without their consent. However, games practice has shown that an open approach to mods can bring advantages for all sides. Many developers appreciate the passion of their community and want to harness this energy without giving up the reins completely.

The key lies in clear contractual regulations: A well-worded EULA or modding policy can delineate exactly what fans are allowed to do. This gives modders legal permission for their creativity and they don’t have to worry about suddenly being confronted with warnings – as long as they stick to the rules. The developer, on the other hand, retains control over their intellectual property, can intervene in the event of problematic mods and ideally even secures usage rights to great fan content.

Developers need to strike a smart balance between control and freedom. A regime that is too strict could scare the community away; a too lax approach carries the risk of diluting one’s own IP or missing out on opportunities. German developers must also take into account the specifics of local law: EULA clauses should be transparent and fair in order to stand up to consumers.

In the end, experience shows that modding can enrich a game and keep it alive – if you approach it correctly. A general ban and legal threats are a waste of potential. It is better to welcome creative fan projects, steer them in an orderly direction with clever contractual clauses and perhaps even actively include outstanding mods in your own portfolio. This creates a lively win-win situation: players can develop and help shape their favorite game, while developers benefit from a loyal community, extended sales phases and sometimes even new sources of income. In short: clear rules and a little trust create a modding landscape in which legal certainty and creativity go hand in hand.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.