Ambush marketing

As abovesaid, there is in France no specific anti ambush-marketing legislation. So conflicts of interests between those of the official sponsors on the one hand and, on the other hand, the interests of the sponsors of the athletes, the interests of the sponsors of supporters, or the interest of the public in the other hand has not given rise to any particular rules.

This type of protection essentially consists in laying down contractual obligations on the different participants, spectators and official partners. So the various protagonists of the manifestation can freely organize their relations and the present constraints only result from the possible sporting regulations or the conventions beforehand agreed by the athletes.

Contracts allow the organizers to rebuild the monopoly, between the contracting partners at the least. They give rise to a preventive action against ambush-marketing, which is particularly beneficial for federations and organizers, as ambush-marketing presents the particularity to be sanctioned with difficulty a posteriori.
As a consequence, sponsors' rights are organized into a strict hierarchy. The "Charte du sport de haut niveau" (French high level sports charta) states in its rule IX : "Pour les sports individuels comme pour les sports collectifs, toute équipe de sportifs est directement et exclusivement soumise à l’autorité du responsable désigné par le groupement sportif ou par la fédération (…). Selon les cas, le groupement sportif ou la fédération dispose de droits exclusifs d’exploitation de l’image collective de l’équipe à l’occasion des activités sportives de celle-ci et pour la promotion de ces seules activités. Tout contrat individuel contraire leur est inopposable. L’étendue des droits et obligations de chacun est déterminée par les règlements fédéraux applicables ainsi que par les usages (…). Elle peut être précisée dans des contrats individuels adaptés aux caractéristiques de l’équipe, sous réserve qu’ils soient compatibles avec les principes énoncés dans la présente charte et avec la réglementation fédérale"³².
Thus, rights of teams and athletes (notably the right of publicity) are limited by the specific provisions in favour of federations and organizers. Propriety rights of federations and organizers are logically regarded as superior to individual rights. In case of conflict, the interests of organizers or federations sponsors are taken into account as a priority. Indeed, such sponsors have contributed to the creation of the sport event and have generally been essential to its organisation, which is obviously not the case with athletes' sponsors for example.

So, individual rights of publicity and the subsequent sponsorship contracts are only valid as long as they are not conflicting with upper rights as stated in federal regulations.

As a consequence, in the silence of official regulations, athletes and teams are allowed to display advertisements for their sponsors. This notably results from the fact that the former ban for high level athletes to be associated to a manifestation or an advertising campaign was lifted.

2. 
   Examples of contractual obligations
   

It would be possible for federations or organizers to limit sub-licences, and to ban joint promotional operations with possible "ambushers”³³. It should equally be possible to control the attitude of spectators, their clothing and the goods they may bring into the sporting arenas.

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  Selective distribution of products under licence,
  
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  Organizers' agreements prior to the launching of any new product under licence,
  
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  Banning of all promotion operations with companies other than official partners,
  
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  Banning of sub-licences, licence transfers or other forms of sharing of official rights which have already been granted,
  
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  Right of priority for official partners on advertising spaces and in official publications,
  
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  Strengthening of legal safeguards by stipulating in the partnership agreements that the partners may exercise, on an exclusive basis, the rights granted, by a set of "intuitu personae" clauses associated with automatic termination clauses,
  
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  Prohibitions and restrictions on the sale and resale of tickets,
  
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  Restricted right of entry to the sites (etc.)
  

Furthermore, strict contractual obligations could be printed on all entry tickets and all other rights of access in order to reserve the right of entry and the right of exclusion to any person who might violate the marketing programme. In other words, the entry tickets can refer to terms and conditions prohibiting the audience from displaying advertisements for non official sponsors³⁴.

But some authors have interpreted a ruling of the French Conseil d'Etat dated November 19th 1997 in this sense, that a delegatee federation exceeds the powers granted by the delegation, when it imposes upon athletes to wear determined sponsored clothes. Indeed, such a decision is not justified by the general interest underlined by the mission of public services³⁵.

On the contrary, the French Court of cassation considers that the existence of a delegation does not matter, so that a federal regulation imposing specific utilities would be certainly valid³⁶.

3. 
   Consequences of contractual violations
   

A violation of a sporting regulation has in principle no consequences over the validity of contracts. The Appeal Court of Paris has decided in a ruling dated February 28^th 1984 that an advertising contract entered into by an athlete in contravention of a federal prohibition couldn't be threatened³⁷. Indeed, such an agreement would only be cancelled if a general interest was involved by the violated rule, which is not the case for a sporting regulation with a commercial matter.

But the federation could impose disciplinary sanctions on these defaulting athletes (loss of the accreditation for the sporting manifestation and therefore of the participating right, for instance).
Further, each contractual non performance can be compensated by damages. Those have to cover the whole prejudice, which is sometimes difficult to determine. As an example, let us mention a case-law dated May 14^th 2004. Judges had to determine the prejudice of a sponsor, resulting from the fact that the French Horseriding Federation members didn't wear the sponsor's suit during the official ceremonies of the international championships. They have decomposed the prejudice in taking into account the following elements:

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  the competition has an international status and is widely covered by the media, so that advertising fallouts could have been substantial;
  
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  the sponsor was deprived of the benefits of a free advertising campaign (whereas half a page in Cheval magazine costs 2134 euros and a passage in Stade 2, a TV show, 33585 euros);
  
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  the advertising expected would have caused an heavy increase of the turnover.
  

In order to avoid the inconveniences and uncertainties involved by such a judicial rescission, which is only pronounced for an essential non performance, parties can also stipulate a resolutive clause.

Finally, case-law⁴⁰ now acknowledges the possibility of an unilateral and therefore extra judiciary rescission, when it is justified by the particularly bad behaviour of the defaulting debtor⁴¹.

2. 
   Competition law
   

Sponsors and organizers are granted exclusive rights. Thus, enforcement of anti ambush-marketing provisions could be considered as constituting antitrust infringements (abuse of dominant position/ competition restricting agreements).

1. 
   Competition restricting agreements
   

Article L.420-1 of the French Commercial Code deals with a specific anti-competitive practice. It provides: "Common actions, agreements, express or tacit undertakings or coalitions, particularly when they are intended to:

       1° Limit access to the market or the free exercise of competition by other undertakings;
       2° Prevent price fixing by the free play of the market, by artificially encouraging the increase or reduction of prices;

       3° Limit or control production, opportunities, investments or technical progress;

Article 81 of the Treaty prohibits agreements between undertakings in similar words, when trade between Members States is likely to be affected.

2. 
   Abuse of dominant position
   

Article L.420-2 of the French Commercial Code, mainly inspired of article 82 of the Treaty, states: "The abuse by an undertaking or group of undertakings of a dominant position in the internal market or a substantial part of this shall be prohibited in accordance with the conditions specified by article L.420-1. These abuses may in particular consist of refusals to sell, linked sales or discriminatory conditions of sale and the severance of established commercial relations solely because the partner refuses to submit to unjustified commercial conditions (...)".

Of course, the Law on Sport of July 16, 1984 could not be relied on as regards to these cultural events. However, the rights of intellectual property, the common law of civil liability as well as the provisions of the French consumer Code regarding deceptive advertising could indisputably be applied... which evidences the flexibility as well as the worth of the solutions provided by French Law.

Finally, France has not organized any non-legal answer to fence off ambush-marketing. There is not a specific administrative organ in charge of publicly stigmatising the ambush-marketing behaviours. But organizers of sporting events usually come into contact with ambushers to warn them of a possible legal action because of their ambush-marketing practices. On this occasion, they require them to withdraw the litigious advertising and it is not unusual that ambushers undertake to publish an official press release, in which they explicitly acknowledge the rights of the organizers on the manifestation and take the pledge for the future not to violate those exclusive rights.