When AI becomes the scalper, is there any way to regulate it?
- A brief overview of Taiwan and foreign frameworks

From the record-breaking concerts of Blackpink to baseball games at the newly opened Taipei Dome, fans are feeling the sting of ticket scalping. Unfortunately, things are only becoming worse as technology advances, with scalpers using computer software to bulk-buy and resell tickets at outrageous prices. In this article, we summarize anti-scalping laws in Taiwan and compare them with how other countries are addressing this issue, to see where Taiwan can improve.

I. Modern ticket scalping behaviors

When K-pop supergroup Blackpink came to Kaohsiung, Taiwan in 2023, scalpers attempted to resell tickets at over 40 times their retail price.[1] Later that year, scalpers snatched and hoarded tickets for the inaugural games at the Taipei Dome, the first-ever indoor baseball stadium in baseball-crazed Taiwan.[2]

In the United States, when the presale for Eras Tour tickets launched on Ticketmaster in 2022, the website crashed when 3.5 billion ticket requests came in a single day.[3] The Eras Tour caused similar incidents in Brazil, where online scalpers overwhelmed servers and pushed real fans to the end of the queues.[4] Meanwhile, Southeast Asian fans eagerly waited for hours in virtual queues to secure Eras Tour Singapore tickets, only to encounter the dreaded “sold out” sign. Disappointed fans soon found these same tickets being resold at ten times their face value.[5]

While scalpers have always profited from reselling sought-after event tickets at a markup, modern technologies have exacerbated the problem and even given rise to new models of scalping behaviors. For instance, AI-driven programs help scalpers bypass safeguards such as validation codes and ticket limits to engage in bulk-buying as soon as tickets go on sale. Some scalpers are now selling such bulk-buying software.[6] It is thus more important now than ever to tackle the problem at its source by preventing the spread of ticket bulk-buying software and regulating “preparatory”, “pre-sale” scalping behaviors.

II. Regulatory frameworks in Taiwan and around the world

In May 2023 and January 2024, Taiwan’s Development of the Cultural and Creative Industries Act and the Sports Industry Development Act were amended to outlaw pre-sale scalping behaviors targeting a wide range of entertainment events. These amendments prohibit the use of computers or other related equipment to purchase tickets by means of false information or other improper means to obtain booking or collection certificates for tickets for arts and cultural events and tickets for sports events or activities respectively and impose criminal liabilities on the perpetrators.[7]

In 2016, US Congress passed the Better Online Ticket Sales Act, or the BOTS Act, making it illegal to “circumvent online ticket restrictions, or to sell tickets purchased using bots on the secondary market”.[8]  While it sounds promising, the act has only been enforced once in 2021.[9]

Similar to the BOTS Act, the UK’s Digital Economy Act[10] and the EU’s Unfair Commercial Practices Directive[11] prohibit the use of automated means to circumvent or undermine ticketing rules to obtain tickets to events.

Notably, the US state of Michigan bans the sale, transfer, use or possession of computer software that circumvents the security measures of ticketing websites or disrupts their purchasing rules. In other words, Michigan not only prohibits the use of automated methods to purchase tickets in bulk but also outlaws the possession or trade of programs designed to facilitate automated ticket scalping. This comprehensive approach aims to eliminate automated ticket bulk-buying and scalping entirely.[12]

In the more classical case of ticket scalping, i.e., resale of tickets above their original face value for a profit, there is a variety of approaches in jurisdictions around the world. In Taiwan, such behavior is prohibited. In the US, such behavior is regulated at the state level. For example, California prohibits the resale of tickets acquired for such purpose at a price higher than their original face value in the vicinity of the venue or where event tickets are being sold.[13] New York[14] and Arizona[15] do not prohibit the resale of tickets above their original face value but do restrict where tickets can be sold, such as prohibiting the resale of tickets too close to the event venue.

In Europe, EU member states also differ in how they deal with ticket resale. Ireland[16], France[17] and Italy[18] prohibit the resale of tickets, whereas Hungary and the Netherlands have no explicit prohibition.[19] In Singapore, there are no restrictions on ticket resale.[20]

III. A better future for industry and fans

Following recent amendments, the scope of prohibition against ticket scalping in Taiwan has noticeably expanded. Taiwan has also adapted to technological advancements by prohibiting automated methods used to obtain large quantities of tickets. However, there is currently no explicit law addressing the transfer of ticket scalping software. This article suggests that Taiwan should look to the laws of Michigan as a model for further legislative action. These, combined with the continued strict enforcement of existing laws, will ensure more tickets end up in the hands of genuine fans, who are the driving force for the entertainment industry.

This is an abridged translation of the original article in Chinese, which can be found here. Written by Ling-ying Hsu and Chi-hsien Nieh. Translated by legal intern Jack Wolthuis.

Because the content of this article involves information about many countries, to avoid any omissions despite all efforts to verify the information, please refer to the original sources independently and interpret them when citing relevant information.

If you have questions about entertainment law or require any additional information, please feel free to contact Ling-ying at lhsu@winklerpartners.com.

Written on June 26, 2024 By Ling-ying Hsu and Chi-hsien Nieh.

Translated on July 8, 2024 By Jack Wolthuis.

[1] See Taiwan News’ article “Taiwan ticket scalpers face up to 3 years in prison, fine of 50 times ticket price” (https://www.taiwannews.com.tw/news/4889952).

[2] See Taipei Times’ article “More than 60 investigated over Taipei Dome scalping” (https://www.taipeitimes.com/News/taiwan/archives/2023/12/02/2003810024).

[3] See CBS News’ article “Frustrated Taylor Swift fans battle ticket bots and Ticketmaster” (https://www.cbsnews.com/news/taylor-swift-fans-battle-ticket-bots-and-ticketmaster/).

[4] See NBC News’ article “‘Taylor Swift law’ introduced to criminalize ticket scalping in Brazil” (https://www.nbcnews.com/news/latino/taylor-swift-law-introduced-brazil-scalpers-overwhelm-eras-tour-sales-rcna90519).

[5] See The Star’s article “RM10,000: Scalpers selling tickets to Taylor Swift SG shows for 10 times the original price” (https://www.thestar.com.my/lifestyle/entertainment/2023/07/05/rm10000-scalpers-selling-tickets-to-taylor-swift-sg-shows-for-10-times-the-original-price).

[6] See CNA’s article “Developing bulk-buying software Max violates the Development of the Cultural and Creative Industries Act” (https://www.cna.com.tw/news/asoc/202404230292.aspx).

[7] See Article 10-1, Paragraph 3 of the Development of the Cultural and Creative Industries Act (https://law.moj.gov.tw/ENG/LawClass/LawSearchContent.aspx?pcode=H0170075&norge=10.1), and Article 24-1, Paragraph 3 of the Sports Industry Development Act (https://law.moj.gov.tw/ENG/LawClass/LawSearchContent.aspx?pcode=H0120056&norge=24.1).

[8] See Federal Trade Commission’s description of the BOTS Act (https://www.ftc.gov/legal-library/browse/statutes/better-online-ticket-sales-act).

[9] See supra Note 3.

[10] Digital Economy Act 2017 s. 106, available at https://www.legislation.gov.uk/ukpga/2017/30/section/106?view=plain.

[11] Unfair Commercial Practices Directive (2005/29/EC), Annex I, No. 23a (in the amended Annex I), available at https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32005L0029 and https://data.europa.eu/eli/dir/2019/2161/oj.

[12] Mich. Comp. Laws § 750.465(2), available at https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-750-465.

[13] CA Penal Code § 346 (2023), available at https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=346.&lawCode=PEN.

[14] Arts and Cultural Affairs (ACA) § 25.11, available at https://www.nysenate.gov/legislation/laws/ACA/25.11 (for venues with a capacity of 5,000 or more, one may not resell, offer to resell or solicit the resale of tickets within a radius of 1,500 feet; for venues with less than 5,000, one may not engage in such behaviors within a radius of 500 feet).

[15] AZ Rev Stat §13-3718 (2022), detailing the prohibition on the sale of event tickets sold for more than their original price within a 200-foot radius of the venue where the theater, music, sports, or other event is held, or at the entrance to an adjacent parking lot; available at https://www.azleg.gov/ars/13/03718.htm.

[16] Cultural, Entertainment, Recreational and Sporting Events Act 2021 § 15, available at https://www.irishstatutebook.ie/eli/2021/act/21/enacted/en/html.

[17] French Penal Code Article 313-6-2, available at https://www.escardio.org/Congresses-Events/group-registration-conditions and https://www.legifrance.gouv.fr/codes/article_lc/LEGIARTI000025492294.

[18] See IQ Magazine’s article “Industry still against Italy named ticket law” (https://iq-mag.net/2019/03/biz-divided-italy-nominated-tickets/).

[19] See Face-value European Alliance for Ticketing’s (FEAT) “Stop Touting- A Guide to Personalised Tickets in Europe”(https://www.feat-alliance.org/wp-content/uploads/2021/01/FEAT-Personalised-Ticket-Guide-First-Edition.pdf).

[20] See the Q&A on the website of Singapore’s Ministry of Trade and Industry (https://www.mti.gov.sg/Newsroom/Parliamentary-Replies/2019/02/Written-reply-to-PQ-on-ticket-scalping).