Transcript Advertising and sponsorship in Europe: a step-by

Advertising and sponsorship in Europe
European Gambling Briefing
9 May 2007
Thibault Verbiest
Partner ULYS
www.ulys.net
www.gaminglaw.eu
Advertising and sponsorship
in Europe
• Overview
Legal framework for gambling advertising and
sponsorship in the EU;
Legal framework in Germany, Belgium, France;
Specific sponsorship & IP issues
EU Legal framework
• No EU regulatory instrument on gambling advertising and
sponsorship
• Gambling excluded from
- the E-commerce Directive
- the directive on services in the internal market
• Gambling prohibited in most MS
• Consequence: advertising and sponsorship restricted in
most Member States
• EU level
 Article 43 & 49 EC Treaty
 ECJ case-law: Lindman, Gambelli, Placanica
EU Legal framework
• ECJ case-law limits possibility for Member States to
restrict the free movement of gambling services across the
EU to the statistical proof by the Member States of a
« consistent gaming policy » (Lindman, Gambelli,
Placanica), i.e., MS may not prohibit the advertising of
gambling services by foreign private operators where they
themselves incite their consumers to play through intensive
marketing campaigns by their monopolies (e.g., Française
des Jeux)
• Constant ECJ case law: National legislation which
prohibits the pursuit of activities related to gaming and
bets, in particular bets on sport events, without a licence or
a police authorization issued by the Member State
concerned, constitutes a restriction on the freedom of
establishment and the freedom to provide services
EU Legal framework
• Member states are free to set the
objectives of their policy on betting and gaming
• BUT the restrictive measures that they impose must :
- be exceptional or justified for reasons of overriding
general interest (consumer protection)
- be proportionate with regard to the reasons adduced, i.e.,
reflect a « consistent and systematic policy » (Gambelli,
Placanica: criminal penalties are disproportionate to
achievement of aim
(Gambelli, Placanica)
- be applied without discrimination
EU Legal framework
• European Commission
Ongoing infringement procedures on grounds of
restrictive gaming legislation (≠ article 49), mostly
related to sports betting restrictions (Germany, Italy,
Sweden, Denmark, Finland, the Netherlands, France,
Austria and Hungary)
• De facto deregulation process taking place in several
MS: Germany, Belgium
• Toughening of sanctions against advertisers in France
EU legal framework:
Germany
• Germany: Constitutional court decided that sports
betting monopoly contrary to constitution since
does not effectively prevent addiction: lack of
consistent gaming policy (Gambelli) ► intensive
advertising campaign from ODDSET
• Review of monopoly in accordance with EU law :
deadline December 2007
• Draft treaty on new monopoly contrary to EU law
• Likely opening of the market by 2008
EU legal framework:
Belgium
• Current regime :patchwork of legislation
 2002 Act: National lottery monopoly may organise
lotteries, games of chance, betting and contests online
 1999 Act: Games of Chance subject to licence by Gaming
Commission
 1963 Act on sports betting : licence system on
competitions and betting concerning sport events results
granted by the Sport Ministers of the Belgian Communities
(only pool betting)
 Fixed-odd betting not regulated but liable for taxation
 Horse betting subject to authorization by Ministry of
Finance
 No licence available for internet gaming: prohibition
 SMS games authorized only in the framework of a
complete television program
EU legal framework:
Belgium
• Who can advertise in Belgium?
 Remote gaming operators not authorized to promote services
 Under article 64 of the 1999 Act only Belgian licensed games of
chance may be promoted in Belgium, whether in French or in another
language;
 Under the 1963 Act, advertising or promoting activities on sports
betting is punishable if the promoter does not have the required betting
license on those sports activities.
 Article 23, 10° of the 1991 Act clearly forbids publicity, which can
give a consumer a hope or a certainty that he has won or can win by
coincidence a product, a service or any other benefit.
 However, advertising of fixed odd betting not punished
 Concrete risks of prosecution low
EU legal framework:
Belgium
• Draft proposal on games of chance
 Initially presented to the House of Representatives on 7
December 2006
 Draft bill inserted in the 2006 Finance Act in order for it to
come under an “emergency procedure”
 Adoption was scheduled end 2006
 Withdrawal due to lobby by the National lottery and the Belgian
casino grouping
 Then examined by the House under normal bicameral procedure
 Adoption was scheduled end of February but now suspended
 Time of adoption unknown
EU legal framework:
Belgium
• Draft bill on games of chance
All bets subject to the new law and to the extended
competence of the Gaming Commission
Possibility for EU gaming operators to apply for a
“reliability certificate” with the Gaming
Commission to operate games of chance and
sports bets via the internet
Consequence: holders of certificate would be
entitled to advertise, the others would be more
likely subject to prosecution in view of extended
competence of gaming board
EU legal framework:
France
• Transitional period until 5 September 2007
• Current regime
Advertising of prohibited lotteries and sports
betting sanctioned by a “light” 4500 € fine: 1836
Act on lotteries
Advertising of other games of chance, and horse
betting punished by rules governing criminal
complicity: max three years imprisonment term
and a 45 000 € fine (same as for author)
EU legal framework:
France
• Only authorized operators may advertise
and conclude sponsoring agreements: FDJ
& PMU
• Discriminatory situation betw national
operators and foreign operators
• Test casinos may advertise international
poker tournaments held on their premises
during the event
EU legal framework:
France
• New regime from 5 September 2007 onwards : bill on
prevention of delinquency
 Fines against “anyone which advertises by any means
whatsoever” an unauthorized gaming house, gaming circle,
sports betting and horse betting = 30 000 euros fines + the
possibility for courts to multiply this fine by four times the
amount invested in the advertising expenses
 Not yet into force: current rules still apply
 But principle of retroactivity of more favourable criminal
law provisions: rules governing criminal complicity for
unauthorized games of chance and horse betting to be
replaced retroactively by the new regime
EU legal framework:
France
• Who’s at risk?
• Those who advertise through physical presence in France
or conclude sponsorship agreements in the field of sports
betting, including horse betting: domain of monopolies
(FDJ & PMU) ► recently : French CSA wrote to Canal +,
Eurosport, Direct 8, Jet concerning promotion of online
games
• Online advertising seems less risky
• Precedent: BWin arrests following sponsorship agreement
with FC Monaco ► Football clubs required by
government to stop entering into sponsorship agreements
with sports betting companies
EU legal framework:
France
• Placanica case : “Member State may not apply a criminal
penalty for failure to complete an administrative formality
where such completion has been refused or rendered
impossible by the Member State concerned, in breach of
Community law.”
• Consequence: criminal penalties imposed in case of
gambling advertising contrary to EC law: France likely to
be in breach of EC law ►no consistent gaming policy
• Ongoing Commission infringement proceedings against
France on grounds of restrictive sports betting regulations:
France likely to modify legislation in the mid term
• Victory of Sarkozy might open up market
EU legal framework:
Sponsorship
I.
Definition and characteristics of the sponsorship
II.
Sponsorship and gambling : specific issues
1. Other legal uses of emblems / signs / trademarks
and names of the sport event
2. What about the case where the sports event does not
take place or the sportsman cannot participate ? (ex :
UNIBET)
EU Legal framework:
sponsorship
I. Definition= a business relationship between a provider of
funds, resources or services and an individual, event or
organization which offers in return rights and association
that may be used for commercial advantage in return for
the sponsorship investment
•
The organizer of the event grants to the sponsor
intellectual property rights, e.g, use of the trade marks
•
The organizer of the event grants to the sponsor the right
to associate to the sport event
•
This could be done with advertising, promotion, etc…
EU Legal framework:
sponsorship & IP
II. Specific issues: other legal uses of trade marks / signs/
emblems …
a. Issue
What about the use of the name of the sport event by
other firms than official sponsors and licensees ?
b. Principle : a third party cannot use a trade mark « in the
course of trade »
Advertising is covered by the « course of trade »
c. Exceptions : right of information and use of a trade mark
with descriptive aim
EU legal framework:
sponsorship & IP
• Right of information
 The right of information may limit the monopoly of a trade
mark
 Information is not restricted to the media trademark can be
used by a third if this use is made with descriptive aim, in
its usual sense
• Use of a sign with descriptive aim
 ≠ a use « as a trade mark »
 Legal dispositions :
- Article 17 TRIP’s
- Article 6 Harmonization Directive
EU legal framework:
sponsorship & IP
• Article 17 TRIPS
“Members may provide limited exceptions
to the rights conferred by a trademark, such
as fair use of descriptive terms, provided
that such exceptions take account of the
legitimate interests of the owner of the
trademark and of third parties.”
EU legal framework:
sponsorship & IP
• Article 6 of Directive n°89/104 : limitation of the effects of
a trade mark
The trademark shall not entitle the proprietor to prohibit a
third party from using, in the course of trade :
(b) indications concerning the kind, quality, quantity,
intended purpose, value, geographical origin, the time of
production of goods or of rendering of the service, or other
characteristics of goods or services;”
EU legal framework:
sponsorship & IP
• ECJ « Hölterhoff » case :
The proprietor of a trade mark cannot rely on his
exclusive right where a third party, in the course of
commercial negotiations, reveals the origin of
goods which he has produced himself and uses the
sign in question solely to denote the particular
characteristics of the goods he is offering for sale
so that there can be no question of the trade mark
used being perceived as a sign indicative of the
undertaking of origin
EU legal framework:
sponsorship & IP
• French case-law
Case « Tour de France » v/ «Tour voile »
Court of Appeal, Paris, 28 march 2001 (« Gemka
production » v/ « Tour de France »)
a trademark can be used by a third when it is
realized with the aim to identify the sport event
per se, in its usual sense
EU legal framework:
sponsorship & IP
• Specific examples: Using of the name of a sportive event
in his usual sense, with descriptive aim :
 a sportive broadcasting which announce the results of sport
events
 a stock investment company which has to quote the
company to which it refers
MrBookmaker/Unibet cases
EU Legal framework:
sponsorship & IP
II.


«

Specific issues: case where the sportsman of the team
does not participate in the sport event
« Unibet » case : team banned by the FFC and the ASO
from participating in French races
Sponsorship agreements generally preview clauses to
prevent this case, regarding to the sponsorship fee:
The contractual parties shall support each other to the
best of their abilities and shall take all reasonable
measures to fend off any possible procedures against the
advertising measures, which are the subject of this
Contract »
Agreements generally preview that in such case the
contract is terminated + that the fees are reduced
Conclusion
• Advertising & sponsorship subject to
various degrees of restrictions due to
restrictive gaming legislation and IP rights
• De facto de regulation taking place might
open the way to more lenient rules on
gambling advertising and sponsorship
Thank you for your attention
[email protected]