18/03/2020 ROB JONES - Counsel, The Sports Consultancy & Associate, TSC Legal

This week’s compromise between the BOA and a group of high profile Team GB athletes regarding the BOA’s athlete marketing guidelines for the 2020 Olympic Games once again highlights the extent to which interpretations of the IOC’s Rule 40 vary from country to country – and the challenge that presents to athletes, brands and agencies in working creatively within them.

Successful athletes have always been willing and able to trade on the value of their fame, from the Olympians of Ancient Greece enjoying free board, lodgings and even theatre tickets provided by their grateful city-states to the high-earning track and field celebrities of today, created by a convergence of technological evolution, media exposure and their identification as role models.

The modern athlete is more keenly aware of their worth than ever before and is also more willing to question the status quo should they find their commercial opportunities restricted by it. We have seen a culmination of that in the last week with the British Olympic Association’s (BOA) agreement of a further relaxation of its Rule 40 marketing guidelines. This ended a legal challenge brought by a group of leading athletes including world champions Mo Farah and Dina Asher-Smith and led by Adam Gemili.

Bye-law 3 to Rule 40 of the Olympic Charter historically prohibited athletes from appearing in any form of advertising during, and for a short period before and after, the Olympic Games (known as the Games Period) without the International Olympic Association’s (IOC) permission. The rule was introduced by the IOC to ensure Olympians remained amateur, but also allowed the IOC to benefit from the commercial exclusivity it could offer members of The Olympic Partner sponsorship programme.

TSC Legal’s work with high-profile athletes, international brands and agencies has made us acutely aware of the frustration Rule 40 has created for them. The strongest expressions of these frustrations began with high-profile members of Team USA campaigning against it on social media during the 2012 Games.

In February 2015, the IOC responded by introducing guidelines allowing pre-existing, generic advertising campaigns featuring Olympic athletes to be shown during the Games Period, subject to their approval by the IOC or the relevant NOC. However, only following Germany’s Federal Cartel Office declaring Rule 40 to be anti-competitive, did the IOC amend Bye-law 3 of Rule 40 in June 2019 placing all responsibility for interpreting, implementing and enforcing Rule 40 in the hands of the NOCs.

While that has generally given Olympic athletes more commercial freedom, it has also shifted the focus of frustration for some as marketing restrictions have subsequently begun to vary significantly from country to country, liberating some performers more than others. For example:

  • Athletes in Germany’s Olympic team are able to use a wide range of Olympic-related words and phrases during the Games Period (e.g. “medal” and “Summer Games”) and face no restriction on the number of thank you messages they can post or how many congratulatory messages their sponsors can share.
  • The Australian Olympic Committee allows “business as usual” campaigns featuring sponsored athletes to continue during the Games Period provided the athletes do not associate with the Olympic Games and such campaigns are not escalated during this time; and gives athletes the right to thank their personal sponsors for each performance (including any medal ceremony) during the Games Period, subject to certain restrictions.
  • Members of Team USA are able to post up to seven thank you advertising messages throughout the Games Period, during which brands are also permitted to run generic advertising campaigns featuring sponsored athletes. Unlike the positions of some other NOC’s, these campaigns may be new, rather than a continuation of those already running. However, the United States Olympic and Paralympic Committee has also obliged athletes’ commercial partners to sign a ‘Personal Sponsor Commitment’ that provides it with a direct contractual remedy for any breach of the new conditions, with the claim made against the brand rather than the athlete, as was previously the case.
  • The Canadian Olympic Committee has been historically more relaxed about Rule 40, having allowed athletes to thank personal sponsors and brands to both congratulate athletes and continue running established advertising campaigns with no escalation, for both Rio 2016 and PyeongChang 2018. For Tokyo 2020, it has moved further again, allowing more opportunities for athletes to engage personal sponsors and introducing an expanded window for pre-existing generic advertising campaigns.

Meanwhile, in the BOA’s first draft of their marketing guidelines, the BOA loosened its strings only marginally, restricting Team GB members to just one thank you message per sponsor, for example. Athletes found little value in these types of concessions.

However, the BOA’s latest relaxation of its guidelines increases the number of sponsor endorsements (via thank you messages) athletes can make for any one sponsor from one to three (with a new maximum of ten messages of thanks for sponsors overall); and reduces both Team GB athletes’ requirement to obtain BOA clearance for messages they send and the “in-market” period for an advertising campaign any of them feature in prior to the Games Period. The BOA’s initial stance alongside these latest relaxations highlights its unique position of relying wholly on Team GB sponsorship revenue to enable Team GB athletes to compete in the Summer and Winter Olympic Games, rather than being in additional receipt of state funding in the manner of other NOCs.

To maximise the sponsorship opportunities available to Team GB, the BOA is motivated to restrict the benefits brands could otherwise acquire through athlete commercial partnerships, which it did prior to Rio 2016 and PyeongChang 2018, by continuing to prohibit Team GB athletes from making any reference to their participation at the Olympic Games for any commercial purpose during the Games Period.

The solution that has been negotiated goes at least some way to achieving the aims of many Team GB athletes – to maximise their commercial opportunities at the most high-profile moment of their careers. However, it still sees their earning power more restricted than athletes from some other countries and it seems unfair that athletes competing in the Olympics will face different restrictions according to their nationality.

However, it is also clear that each NOC is in a unique position and that their rules must be examined on an individual basis. As IOC President Thomas Bach has stated: “We don’t have a one-size-fits-all solution.”

The next task for athletes, agencies and brands is to understand the limitations within which they must work and develop their Tokyo 2020 commercial partnership strategies accordingly (coronavirus permitting).