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PAL version
"PAL version" usually refers to the version of a particular game that works with CCIR/PAL TVs.
CCIR and PAL (short)
CCIR televison sets output 50 fields per second. 2 Fields form a frame. A frame has 576 visible lines. A digital video containing 50 fileds per second with 2 fields forming an image (resulting in 25 frames per second) that is 720 pixels wide and 576 pixels high is considered "PAL compatible".
Consoles sold in europe and Australia have to output a videosignal that fits the CCIR standard in order to work with the majority of TVs that are found (and sold) in those regions.
PAL (Phase Alternative Line) is a standard used to transport color information with analog videosignals.
"PAL-Version" is the (wrong) expression
Since CCIR is the reason for importent properties of a "PAL version", that is running at 25 frames per second (or even 50) and delivering 576 lines of visual information, it should be called "CCIR version".
Games don't need to worry about PAL, since they only need to deliver colors in a digital format that the console can process. The console's videooutput has to worry about the color transmission format - in the case of PAL it is the RAMDAC that delivers a PAL-Signal suitable for RF, Composite-video or S-Video output. RGB- or component-videosignals and digital-connections use their own format of colortransmission.
Why games need to be adjusted
Most console games use the framerate of the videooutput for their timing. The current status of the games' entities is usually computed only for the next frame.