Ubisoft 2013 Annual Report Download - page 49

Management Report
2013
44
As part of the tax audit at Ubisoft Divertissements Inc. (Canada) from 1999 to 2003, and from 2004 to
2008, a bilateral transfer price agreement has been initiated with the tax authorities. Pending the final
agreement, the provision of CAD$3 million is maintained unchanged.
A tax audit is underway at Ubisoft Entertainment SA for the period from April 1, 2009 to March 31,
2012. No proposed adjustments have been received to date. Consequently, no provision has been
recognized in the accounts.
A tax audit is underway at Ubisoft Divertissements for the period April 1, 2007 to March 31, 2013,
following the challenging by Canadian authorities (Investissement Québec) of CTMM (Canadian credit
multimedia shares) for a significant amount in profitability bonuses paid to employees of the company.
Based on advice of counsel to the Company, no provision has been booked.
REGULATORY ENVIRONMENT 1.7.2.2
The Company has developed tools and implemented the requisite procedures to comply at a global
level with local laws and regulations, in particular those relating to consumer protection, also covering
but not limited to information given to consumers on the rules of use and content of games, the
classification of games in accordance with the age-rating classifications of PEGI in Europe and ESRB
in the United States, the protection of consumers’ personal data when this data is collected, and the
protection of minors (notably by setting up parental consent procedures). The Company has
introduced internal control procedures to check compliance with the above.
It is a member of the ESA (Entertainment Software Association) in the United States and Canada, the
ISFE (Interactive Software Federation of Europe) and the SELL (Syndicat des Éditeurs de Logiciels de
Loisirs) in France, and complies with the PEGI (Europe) and ESRB (United States) classification
systems.
RISKS ASSOCIATED WITH INTELLECTUAL PROPERTY RIGHTS 1.7.2.3
Given the importance and intrinsic value of its brands, the Company has taken the necessary
measures to protect its portfolio of commercial brands as well as the other intellectual property rights
that it holds:
x Procedure for checking the pre-existence of brands proposed for games at European and
international level, registration of brands and domain names of games designed at European,
US and international level;
x Legal monitoring of brands that are similar or identical to those of the Company and that have
been registered by third parties at a global level;
x Legal monitoring of potential Company copyright violations;
x A dedicated anti-piracy team, whose task is to carry out a technology watch, advise
development teams and coordinate action between the various internal and external teams;
x Copyright infringement pressing civil claims in criminal proceedings where applicable, or via
any other available criminal or civil avenues, and measures against hackers in order to obtain
the removal of games illegally put online.
Ubisoft is not dependent on any particular patents.
LICENSING AGREEMENT RISKS
1.7.2.4
Every year, Ubisoft signs a series of partnership agreements with, in particular, prestigious partners
such as film studios, music labels etc., enabling it to develop its game catalogue and increase
revenue.
The biggest licensor accounts for nearly 1.2% of revenue.