One of the most important clauses to review in a video game publishing agreement is the consequences of termination clause.
This might feel counterintuitive, as this clause focuses on what happens after the collaboration ends. In practice, however, a developer’s legal and commercial position after termination often determines whether they can move on smoothly if the publisher relationship no longer works out.
In our experience, many disputes arise precisely because this part of the agreement is vague, incomplete, or overlooked altogheter. These disputes usually disadvantage developers, who then depend on the publisher’s cooperation to finalise the separation. When that cooperation is missing, the consequences can be significant.
What is the consequences of termination clause?
The consequences of termination clause describes how the developer and the publisher wrap up their collaboration once the contract expires or is terminated.
This includes what happens to licenses, payments, store pages, intellectual property, and any outstanding obligations between the parties. In other words, it determines who can do what after the agreement ends.
Why is the consequences of termination clause important?
The purpose of this clause is to provide clarity and legal certainty for both parties.
Without clear agreements, developers may find themselves blocked from further publishing their game, unable to access store pages, or involved in disputes over rights, revenue, or unrecouped advances. Because platform access and IP ownership are often controlled by the publisher during the term of the agreement, termination can be a critical moment where uncertainty creates leverage, usually not in the developer’s favor.
Example of the consequences of termination clause in a video game publishing agreement
Below is an example of a consequences of termination clause in a video game publishing agreement which we have seen in practice, so that you can recognise a similar clause in your own draft:
“General Consequences of Termination.
All rights and obligations of the parties will cease to have effect immediately on the termination or expiry of this Agreement except that termination will not affect the accrued rights and obligations of the parties at the date of termination and any provisions of this Agreement necessary for the interpretation or enforcement of this Agreement. In addition: (a) all licences from Publisher to Developer will cease immediately; (b) Publisher will have a right (but not the obligation) to continue distribution and sales of the Game and Ports for an additional period of 6 (six) months on the same terms as contained in this Agreement (and therefore, for the avoidance of any doubt, Net Revenue will continue to be divided between the parties as described in the Financial Terms; (c) The exclusive rights granted to Publisher will terminate and Developer will be entitled to publish the Game and Ports (but only where ownership of the Ports has transferred to Developer) itself; and (d) the parties will return, or if required destroy, promptly all Confidential Information belonging to each other.
Specific Consequences of Termination.
if Publisher terminates this Agreement for developer breach, then Developer will repay to Publisher any unrecouped Development Funding in full by no later than the date falling 60 (sixty) calendar days after the effective date of such termination.
If the Game has had its Commercial Release, Publisher will where possible: (a) recover the monies via set-off or deductions, including from the Developer Revenue Share otherwise payable to the Developer; and/or (b) continue to distribute the Game and Ports until full recoupment of any outstanding amounts.
How to review and negotiate the consequences-of-termination clause
Ensure a proper transfer of the store pages
One of the most important points to address is the transfer of store pages back to the developer when the agreement ends.
On most platforms, only the publisher can initiate this transfer. If the contract does not include a clear obligation to do so, developers may be left dependent on the provisions of applicable law. These provisions do not explicitly deal with store pages, which means you fall back on general legal provisions. This leads to legal uncertainty. While under some jurisdictions not returning the store pages can be considered unlawful or an abuse of rights, having a direct obligation is always preferable.
In practice, we have seen a case where a publisher refused to return store pages because their marketing efforts had generated significant wishlists. The publisher argued that it would be unfair for the developer to benefit from those wishlists without sharing revenue. Without a specific obligation, the publisher refused to hand over the store pages and the developer had little leverage short of litigation.
Including a clear and unconditional transfer obligation avoids this situation entirely.
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Ensure a proper transfer of intellectual property rights
One of the central principles of copyright law is that the copyright of a creative work is assigned to the person which has created it. This means that if a publisher develops ports or marketing assets, those assets are typically owned by the publisher unless otherwise agreed.
After termination, this can result in a situation where the developer is unable to use ports, trailers, or other assets without the consent of the publisher. Whether that consent is required depends on the applicable law, but relying on default legal rules is rarely ideal.
This risk can be mitigated by including a clause that obligates the publisher to transfer or license these intellectual property rights to the developer upon termination. Such clauses may also address whether compensation is due to the publisher.
For related risks, see also our article on Intellectual Property Rights and Third-Party Software & Engines.
Ensure clear agreements on the (return of the) advance payments which have not been recouped
Another recurring issue is what happens to development funding that has not yet been recouped at the time of termination.
In most agreements we see, an obligation to repay unrecouped advances only exists when the agreement is terminated due to a a breach by the developer. In other termination scenarios, repayment obligations are less common.
Nevertheless, some publishers include repayment obligations even when termination results from their own breach of contract. These clauses should be reviewed carefully, as they can impose significant financial pressure on developers at an already difficult moment.
Before you sign: summary and next steps
The end of a publishing agreement is just as important as its beginning. A well-drafted consequences of termination clause provides clarity on store pages, intellectual property, and unrecouped funding, and prevents developers from becoming dependent on publisher goodwill after the relationship ends.
Because termination clauses often interact with licensing, IP ownership, and financial provisions, they should always be reviewed as part of the agreement as a whole. Getting this right up front can make the difference between a clean break and a prolonged legal dispute.
Many termination disputes don’t arise out of nowhere. They are often triggered by alleged breaches of representations or warranties made earlier in the agreement. In the next chapter, we look at representations, warranties, and indemnification, and how these clauses can shift legal and financial risk between developers and publishers long before termination ever becomes an issue.