This article was first published on Lexis®PSL IP & IT, August 2016
Commercial analysis: From the Euros to the Rio Olympics, the summer of 2016 sees athletes from across the world participate in a number of high profile sporting events. As part of our Summer of Sport series, Andrew Butcher and Sarah Watson, take a look at the controversial Rule 40 and the protection afforded to the Olympic and Paralympic brands.
What special protection is afforded to the Olympic and Paralympic symbols and mottos and how is this brand protection enforced?
Sponsorship has become an integral part of a successful Olympic/Paralympic Games for the International Olympic Committee (IOC) and International Paralympic Committee (IPC). As such, the IOC and IPC have recognised that in order to maintain the appeal of sponsoring these events, and thereby protect their sponsorship income, the words and symbols associated with the Olympic Games and Paralympic Games must be protected from unauthorised use by non-sponsors who seek to benefit from an association with the Games without paying sponsorship fees (so-called ‘ambush marketers’). Therefore, the IOC has made provision for such protection in its Olympic Charter, with which all National Olympic Committees (NOCs) must comply. NOCs are also required to sign a host city contract which sets out their obligations with regard to protection of Olympic and Paralympic intellectual property.
Since the Sydney Olympics, host nations have been required to enact bespoke legislation to afford special protection to Olympic/Paralympic words and symbols—over and above the protection provided by conventional registered and unregistered trade mark rights. For the London Olympics, the London Olympic Games and Paralympics Games Act 2006 (LOGPGA 2006) was enacted, which added to the special protection already afforded to the Olympic/Paralympic words and symbols under the pre-existing Olympic Symbol etc (Protection) Act 1995 (OS(P)A 1995). For the Rio Olympics, equivalent legislation to LOGPGA 2006 will be in force in Brazil.
OS(P)A 1995 prevents the use, in the course of trade, of various Olympic and Paralympic words, mottos and symbols, as well as words and symbols similar to those listed in OS(P)A 1995. LOGPGA 2006 provided even broader protection, allowing the London Organising Committee of the Olympic and Paralympics Games (LOCOG) to take action against parties using any representation of any kind in a manner likely to suggest to the public that there is an association between the London Olympics and particular goods/services or a particular provider of goods/services. LOGPGA 2006 also listed certain words and expressions, such as ‘Games’ and ‘Summer’, whose use (either on their own or in combination with other words) could be taken into account when determining whether an unauthorised association with the London Olympics had been created.
How is brand protection enforced?
Every NOC (and organising committee in the case of host nations) will run their own brand protection enforcement operations to police unauthorised use of Olympic/Paralympic intellectual property in their jurisdiction. During the London Olympics, LOCOG had powers to seek injunctions to stop infringing activities, to sue for damages and/or require an account of an infringer’s profits. The London Olympics had multiple operations running to protect sponsors’ marketing rights during the Games, including monitoring of advertising and street trading via almost 300 uniformed Olympic officers. The Rio Olympics NOC is working with national authorities in Brazil to prevent ambush marketing and counterfeit practices.
What is Rule 40?
Rule 40 of the Olympic Charter governs participation in the Olympic Games. Bye-law 3 to Rule 40 exists to protect the investment of official Olympic sponsors, stating that:‘Except as permitted by the IOC Executive Board, no competitor, coach, trainer or official who participates in the Olympic Games may allow his person, name, picture or sports performances to be used for advertising purposes during the Olympic Games.’
Any reference to a participating athlete in any commercial promotion during the Olympic Games period falls under Rule 40. For Rio 2016, the Games period runs from 27 July 2016–24 August 2016—nine days prior to the opening ceremony until three days after the closing ceremony. In the past, the effect of Rule 40 has been to prohibit brands who are not Olympic sponsors, but who do sponsor individual athletes, from using their sponsored athletes in advertising during the Games period.
Has Rule 40 been subject to any challenges by athletes or organisations in the past and how have these conflicts been resolved?
During the London Olympics, athletes took to Twitter using the hashtag #wedemandchange in protest against the non-sponsor advertising blackout. Athletes were frustrated by the ban on endorsements, which often represent a high proportion of a sportsperson’s earning.
Rule 40 effectively reduced the value to non-Olympic partners (NOPs) of sponsoring an Olympic athlete. Given that athletes are not paid for their involvement in the Games, Rule 40 faced widespread criticism for preventing athletes (sponsored by NOPs) from capitalising on their success during what should be the most lucrative period of their career.
Following the backlash against Rule 40, the IOC met and agreed changes to permit some generic (non-Olympic) advertising featuring Olympic athletes during the period of the Games. The result is that NOCs now have more flexibility to allow advertising featuring athletes, on the condition that any advertising that would create an association with the Games remains prohibited.
What position has the British Olympic Association (BOA) adopted with regards to Rule 40?
The BOA permits NOPs to use athletes in advertising during the Games period where either the ‘Deemed Consent’ or the ‘Rule 40 Waiver’ conditions are met. Deemed consent allows NOPs to use promotional materials depicting athletes that have already been in use continuously for a specific period of time (generally since before 27 March 2016) prior to the commencement of the Games. The advertising is only permitted if it does not create an association with Team GB or the Olympic Games. For example, a tweet using ‘#Rio2016’ or ‘#TeamGB’ would not benefit from deemed consent.
Under the Rule 40 waiver, where deemed consent does not apply, NOPs may apply to the BOA for a waiver to allow the proposed activity, likely to be granted for long-running campaigns featuring famous athletes, on the condition that it is not in a sporting context. A waiver will not be granted in respect of ‘below the line’ advertising activity, such as direct mailings and in-store promotions. In neither the deemed consent nor Rule 40 waiver scenarios does the BOA necessarily need to see the final creative before approving, but it needs as much information as possible around the proposed activity. Examples of such information include details of the athlete(s), the brand, the proposed media channels and timings. Submitting the actual creative content assists the BOA, but it is not mandatory if the other information allows it to deem the proposed activity acceptable.
How does the British position differ from that adopted by other countries and how does the IOC go about enforcing uniformity?
Given that the IOC has effectively adopted a ‘country-by-country’ approach, the stance adopted by different NOCs may vary to some degree, although all NOCs must ensure that their position adheres to the purpose expressed by Rule 40 that is, to prevent Olympic-targeted advertising that creates an association with the Games. For example, the French NOC has taken the line that athletes must first apply to it for authorisation. Other countries, such as the host of the 2020 Games, Japan, are yet to issue any guidance.
Is there any guidance available on complying with Rule 40?
Many NOCs publish guidance for brands on how compliance with Rule 40 may be achieved. Team GB has provided examples both of promotions that would be allowed under Rule 40, namely those that appear outside the Games period and do not make reference to the Games, as well as promotions that would fall foul of the rule. Examples of unacceptable promotions include adverts that appear during the Games and reference an athlete’s performance in the Games or which reference Olympic symbols.
Overall, while some commentators express dismay at the increasing commercialisation of the Games, NOCs point out that without the support of official sponsors it would not be possible to stage the Games. Given that Games partners can spend in excess of £100m for a right of association, this necessitates offering adequate protection for their investment.