Sponsorship and image rights

Concept of image rights

Is the concept of an individual’s image right legally recognised in your jurisdiction?

In Australia, there are no true proprietary image rights or any requirement to register image rights.

Despite this, image rights can be commercialised, including in relation to an individual’s physical image, but also in relation to other aspects of what would, in other jurisdictions, constitute image rights, including an individual’s likeness and voice.

In some circumstances, image rights may be able to be registered and protected as items of intellectual property, such as a surname that has become sufficiently distinctive and otherwise satisfies the requirements of trademark registration.

Commercialisation and protection

What are the key legal considerations for the commercialisation and protection of individuals’ image rights?

Individuals seeking to commercialise their image rights should ensure that those image rights are protected to the extent possible (noting that, in Australia, unless image rights are also intellectual property rights, options for registration to achieve protection are limited).

Any legal documentation regulating the commercial relationship between parties in respect of the use and commercial exploitation of an individual’s image rights should clearly define what image rights are being commercialised and the circumstances in which those image rights may be used.

The individual should seek to retain control over the specific uses of their image rights (eg, by incorporating a requirement for any proposed use to be prior approved by the individual or outlining the circumstances in which the licence to use image rights may be immediately withdrawn).

How are image rights used commercially by professional organisations within sport?

Image rights are often used in Australia by professional organisations for commercial purposes including for promotional purposes and for merchandise production. Individual sporting professionals may enter into affiliations with certain brands, allowing the use of the individual’s image rights in relation to the promotion and sale of certain goods and services.

Care should be taken when a professional organisation grants third parties the right to use an individual’s likeness or image, to ensure that those rights are able to be exploited and to avoid any breach of third party intellectual property rights. Such breaches might include, for example, any copyright subsisting in the imagery, the tort of passing off (which includes passing off an affiliation, endorsement or sponsorship that does not exist) or a breach of the Australian Consumer Law including in relation to any misleading representations made by the use of the image.

Any use or commercialisation of an individual’s image rights should be supported by appropriate contractual documentation, such as a player agreement, sponsorship agreement or licence agreement.

Morality clauses

How can morality clauses be drafted, and are they enforceable?

In order to regulate athletes' behaviour in line with increasing conduct expectations of sporting organisations, sponsors and the broader community, morality clauses are becoming increasingly common in agreements with athletes.

These clauses attempt to prevent reputational harm to an associated sporting club, sponsor or other entity (and, in some instances, to the participant), by giving the contracting party certain rights when the other party acts in an undesirable manner.  These rights can include the option to commence dispute resolution, terminate the agreement or to otherwise impose penalty provisions (subject to the general principle that a penalty that is disproportionate to the actual loss or damaged suffered or likely to be suffered is unenforceable).

Morality clauses in favour of a club, sponsor or other entity should be drafted broadly, to ensure that any conduct of the athlete that violates any law or rule, as well as any conduct that may bring the athlete, club, sport or contracting party into disrepute, triggers rights for the contracting party. Conversely, athletes will usually seek a narrow drafting of the conduct that may trigger the operation of these types of clauses.

Restrictions

Are there any restrictions on sponsorship or marketing in professional sport?

In Australia, there are certain restrictions on sponsorship and marketing in professional sport, which are imposed by the Australian Communications and Media Authority, as well as industry-specific voluntary advertising codes, including the Alcoholic Beverages Advertising Code.

While alcohol and gambling advertising is not prohibited outright, broadcasters are subject to certain restrictions when advertising these types of goods and services. Gambling and alcohol advertisements may only be broadcasted at certain times of the day and are subject to other limitations including the prohibition on advertising alcohol during the screening of programmes classified for children.

Notably, tobacco advertising is absolutely prohibited in Australia and, accordingly, tobacco manufacturers and associated brands cannot enter into brand or product sponsorships or advertise their products including at any Australian sporting event.

Law stated date

Correct on

Give the date on which the information above is accurate.

30 June 2020.