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Wednesday, 5 December 2012

Golden Opportunities?

In hosting the 2012 Olympic Games, it was LOCOG’s vision to create a “real and lasting legacy” that would create economic, social and sporting opportunities for the UK. Following the recent extensive media exposure of our nation’s athletes and the ensuing positive public reaction, The Sports Reputation Group offers some practical advice to British athletes as regards how to take advantage of the commercial opportunities presented by this legacy. Building a Brand The members of Team GB have become familiar faces on our television screens and in the newspapers over the course of the summer, with relatively unknown athletes such as gold-medallist long jumper Greg Rutherford becoming a household name overnight. Many athletes have boosted their media presence further since the games ended with appearances on chat shows, celebrity reality shows and even at London Fashion Week. Whilst such experiences are no doubt enjoyable for the individuals concerned, they should also be viewed as a useful step towards building a personal brand for any athlete who wishes to generate revenue from their success and personality. An athlete's personal brand strategy may, in addition to the methods of publicity generation described above, include personal sponsorship and endorsement deals. Every individual in the UK has the right to prevent unauthorised use of their name, likeness and other personal attributes associated with them such as their nickname and signature. These rights are collectively known as “image rights” which are protected in a slightly piecemeal manner by a number of UK laws. To facilitate profitable exploitation of these rights, athletes can enter into contracts with sponsors whereby the athlete will promise to provide a service in return for money or money's worth (such as sporting equipment) from the sponsor. Typical services provided by sponsored athletes include appearances in advertising campaigns, product endorsement and personal appearances at sponsor events. Athletes who find their image rights being used without consent may be entitled to bring a claim for false endorsement under the law of passing off (as occurred in a case involving Eddie Irvine) or for trade mark infringement if they have a registered trade mark which is being used unlawfully. Injunctions, damages, an account of profits and/or orders to deliver up any offending materials may also be obtained in some circumstances. Various advertising standards codes offer further protection by prohibiting references to people with a public profile without their permission and complaints of inappropriate behaviour can be made to the Advertising Standards Authority. Handling Agents A number of those athletes whose star is on the rise will look to appoint an agent, who will hopefully bring useful knowledge, experience and contacts to the table, to deal with their commercial agreements. Agents operate both nationally and internationally and may be sports specialists or general celebrity agents. When negotiating representation contracts with agents, athletes should consider taking legal advice and should carefully consider the fees payable to the agent, the events that trigger payment and the length of the contract. One need only look at the case concerning Wayne Rooney to witness the effects of an overly restrictive representation agreement with an overly long term. Agents are able to enter contracts on behalf of the individuals they represent, so a relationship of trust and confidence is essential. The activities of sports agents are regulated by UK law and the national and international regulations of various sports. The regulation of football agents is particularly detailed and complex and RFL, cricket and boxing agents are regulated in the UK by their respective National Governing Bodies. Agents must in all cases act in accordance with the terms of their appointment and a number of common law duties set out under UK law (e.g. to use due care and skill, to disclose any conflicts of interest, not to make any secret profit etc.). The Sports Reputation Group is here to assist and advise players, agents and clubs with their reputation management and crisis management. Taxation Revenue (which includes goods such as sports equipment and services received as value in kind) received by an athlete from their sponsors will constitute income for tax purposes. Athletes must therefore plan their finances to prepare for each year’s tax bill and would be well advised to engage a suitably qualified accountant in the event they procure any significant sponsorship deals. To avoid higher rates of income tax, some athletes choose to assign their image rights to a limited company which then licences their use to sponsors. Legal and accountancy advice should be obtained before the formation of such a company, including in relation to VAT implications. Regulatory Issues Special care should be taken in relation to sponsorship deals with organisation selling products considered contrary to the ethos of sport (tobacco, alcohol, fast food or gambling services). This is especially the case as regards youth sports, images of youth athletes, advertising likely to be seen by children and any sensitivities of member athletes. For example, images of individuals aged under 25 of those whose religion prohibits gambling should not feature in adverts for gambling services. Athletes must also check the rules of any applicable national and international governing bodies, including those relating to leagues or competitions in which they participate, for further restrictions on sponsorship. Finally, please take comfort in the fact that The Sports Reputation Group here to help you ensure that your golden opportunities are realised in the best possible way. Bio The Sports Reputation Group is a new and unique entity offering complete media management and reputation management exclusively for clients in sport.

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