Asser International Sports Law Blog

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the T.M.C. Asser Instituut

FFP for Dummies. All you need to know about UEFA’s Financial Fair Play Regulations.

Football-wise, 2014 will not only be remembered for the World Cup in Brazil. This year will also determine the credibility of UEFA’s highly controversial Financial Fair Play (FFP) Regulations. The FFP debate will soon be reaching a climax, since up to 76 European football clubs are facing sanctions by the UEFA Club Financial Control Body (CFCB). More...

Prof. Weatherill's lecture on : Three Strategies for defending 'Sporting Autonomy'

On 10 April, the ASSER Sports Law Centre had the honour of welcoming Prof. Weatherill (Oxford University) for a thought-provoking lecture.

In his lecture, Prof. Weatherill outlined to what extent the rules of Sports Governing Bodies enjoy legal autonomy (the so-called lex sportiva) and to what extent this autonomy could be limited by other fields of law such as EU Law. The 45 minutes long lecture lays out three main strategies used in different contexts (National, European or International) by the lex sportiva to secure its autonomy. The first strategy, "The contractual solution", relies on arbitration to escape the purview of national and European law. The second strategy, is to have recourse to "The legislative solution", i.e. to use the medium of national legislations to impose lex sportiva's autonomy. The third and last strategy - "The interpretative or adjudicative solution"- relies on the use of interpretation in front of courts to secure an autonomous realm to the lex sportiva


Enjoy!


 

Tapping TV Money: Players' Union Scores A Goal In Brazil. By Giandonato Marino

On March 27, 2014, a Brazilian court ruling authorized the Football Players’ Union in the State of Sao Paulo[1] to tap funds generated by TV rights agreements destined to a Brazilian Club, Comercial Futebol Clube (hereinafter “Comercial”). The Court came to this decision after Comercial did not comply with its obligation  to pay players’ salaries. It is a peculiar decision when taking into account the global problem of clubs overspending and not complying with their financial obligations.  Furthermore, it could create a precedent for future cases regarding default by professional sporting clubs.

More...

International transfers of minors: The sword of Damocles over FC Barcelona’s head? by Giandonato Marino and Oskar van Maren

In the same week that saw Europe’s best eight teams compete in the Champions League quarter finals, one of its competitors received such a severe disciplinary sanction by FIFA that it could see its status as one of the world’s top teams jeopardized. FC Barcelona, a club that owes its success both at a national and international level for a large part to its outstanding youth academy, La Masia, got to FIFA’s attention for breaching FIFA Regulations on international transfers of minors. More...

Athletes = Workers! Spanish Supreme Court grants labour rights to athletes

Nearly twenty years after the European Court of Justice declared in the Bosman case that all professional athletes within the EU were given the right to a free transfer at the end of their contracts, the Spanish Tribunal Supremo[1] provided a judgment on 26 March 2014 that will heighten a new debate on the rights of professional athletes once their contract expires.

More...

Welcome to the ASSER International Sports Law Blog!

Dear Reader,

Today the ASSER International Sports Law Centre is very pleased to unveil its new blog. Not so surprisingly, it will cover everything you need to know on International Sports Law: Cases, Events, Publications. It will also feature short academic commentaries on "hot topics".

This is an interactive universe. You, reader, are more than welcome to engage with us via your comments on the posts, or a message through the contact form (we will answer ASAP).

This is an exciting development for the Centre, a new dynamic way to showcase our scholarly output and to engage with the sports law world. We hope you will enjoy it and that it will push you to come and visit us on our own playing field in The Hague.

With sporting regards,

The Editors


Asser International Sports Law Blog | Gambling advertising regulations: pitfalls for sports sponsorship - By Ben van Rompuy

Asser International Sports Law Blog

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the T.M.C. Asser Instituut

Gambling advertising regulations: pitfalls for sports sponsorship - By Ben van Rompuy

In April 2014, the Swedish Gambling Authority (Lotteriinspektionen) warned the organisers of the Stockholm Marathon that it would impose a fine of SEK 2 million (ca. € 221.000) for its sponsorship agreement with online betting operator Unibet. The Authority found that the sponsorship agreement violates §38 of the Swedish Lotteries Act, which prohibits the promotion of gambling services that are not authorized in Sweden.[1] The organisers, however, refused to withdraw Unibet as its sponsor and prominently displayed the Unibet logo at the event, which took place on 31 May 2014. As a result, the organisers of the Stockholm Marathon now face legal action before the Swedish administrative courts.


Source: ASICS Stockholm Marathon 2014

As this case and many others demonstrate, sports organisers, clubs, and individual athletes are insufficiently aware of the challenges that national gambling advertising regulations create for entering into sponsorship deals with gambling operators. But don’t worry; we've got you covered.


National gambling advertising regulations 

In the EU, 28 divergent regulatory frameworks govern the advertising of gambling services through e.g. sponsorship agreements between sports organisers and gambling operators. 

A first category of Member States strictly prohibits any gambling advertising (Estonia, Latvia, Poland, and Lithuania). Sometimes the regulatory frameworks do include a number of notable exceptions, however. In Estonia and Lithuania, for instance, the advertising ban does not apply if only the name of the operator or its logo is used. This creates a legal loophole for e.g. t-shirt sponsorship deals. 

A second category of Member States only prohibits the advertising and/or promotion of unauthorized gambling services (22 Member States). It follows that at least one gambling operator, in many cases the (state-owned) operator who retains a monopoly position, is allowed to advertise its services. Yet even when authorized operators are legally entitled to advertise their services, national gambling advertising regulations may impose certain qualitative (e.g. advertising cannot encourage excessive or uncontrolled gambling) and quantitative restrictions (e.g. TV watersheds). For the most part these restrictions have little bearing on sponsorship. In France and Germany, however, gambling operators are not allowed to sponsor sports events involving minors. 

A third category of Member States has no rules specific to gambling advertising as a result of outdated gambling legislations (Luxembourg and Ireland). 


What are the pitfalls? 

The lack of awareness of sports organisers, clubs, and individual athletes about national gambling advertising regulations can be attributed, at least in part, to the fact that liability pitfalls are often hidden. 

First, the provisions on advertising in the national gambling regulatory frameworks are frequently too vague or ambiguous for practical purposes. More often than not, the regulations make no specific reference to (sports) sponsorship. Consequently, the applicability of the restrictions to sponsorship can only be derived from a broad interpretation of the definition of “advertising”. 

Second, only a few national advertising regulations clarify the extent to which both parties to a sponsorship agreement, i.e. the sponsored party and the gambling operator, can be found liable for breaching the regulations. Only in Denmark and the UK, the relevant rules make it explicit that responsibility also falls on the sponsored parties. 

Third, inconsistencies in the enforcement of the advertising regulations make it even more difficult to anticipate the costs of non-compliance. In many instances, the competences are spread over various authorities (gambling regulators, advertising authorities, consumer protection authorities, police, etc.), which diffuses their responsibilities. Moreover, Member States frequently point to the fact that it is difficult to tackle advertising by foreign, unauthorized online betting operators. 

Yet, as the Swedish case illustrates, there are good reasons not to underestimate the risks. 

Typically an infringement of the prohibition to advertise unauthorized gambling services is considered an administrative offence and will therefore be sanctioned with a fine (which can be substantial, up to € 100.000 or even € 1 million). In various Member States, the sponsored party may even risk criminal prosecution (e.g. in Belgium, Denmark, Finland, Cyprus, Greece, Italy, Malta, and the UK).


International sports events versus patchwork of national regulations 

The potential for conflicting national rules causes even more difficulties for clubs or individual athletes participating in cross-border sports events. By way of illustration, in 2007, the Bavarian authorities (Germany) imposed a fine of € 100.000 on AC Milan for wearing shirts with the name of an authorized operator (Bwin) in a Champions League game against Bayern München. The obvious anomaly is that German sports fans are able to watch home matches of AC Milan and Serie A on television and would therefore already be accustomed to watch the team play with its normal shirt sponsor. 

As EU law currently stands, however, gambling operators and sponsored parties are necessarily confronted with the regulatory burden to comply with 28 different legal requirements. The European Court of Justice has repeatedly held that gambling legislation is one of the areas in which significant moral, religious, and cultural differences exist between Member States. In the absence of harmonization in this field, it is therefore for each Member State to determine the objectives of their policy on gambling and to define, in accordance with its own scale and values, what is required to protect the interests in question.[2] The fact that one Member State applies stricter rules, such as a general prohibition of gambling advertising, than others does not in itself affect that assessment.[3] 

The problem is exacerbated by the fact that gambling operators are increasingly sponsoring international sports events. For instance, according to the regulations of the European Handball Federation (EHF), every delegation participating in the EHF Champions League must comply with the exclusive sponsorship arrangements of the sports organiser.[4] For many years the online gambling operator, Bet-at-home, has been one of the main sponsors of the EHF Champions League. The sponsorship deal allows the operator to advertise in all handball arenas in which Champions League games are held. When hosting qualification matches during the 2010-2011 Champions League season, the Polish Handball club Vive Kielce faced a serious dilemma. It had to choose whether to have the advertisements removed, which would mean elimination from the tournament,[5] or to commit an offence sanctioned by the Polish Gaming Law. The club decided to adhere to the regulations of the EHF and was subsequently sanctioned.[6] 

Further attention should therefore be paid to the use of technological tools that may offer pragmatic solutions in these cases (e.g. the use of virtual advertising). In any event, if a sports organiser induces participants in their events to infringe national gambling advertising rules, they should arguably be found liable and not the participant that is caught in a catch-22 situation. 

For a detailed overview of the national gambling advertising regulations and their relationship to sports sponsorship, check out our latest EC Study on Sports Organisers’ Rights in the EU, available at http://ec.europa.eu/sport/news/2014/study-on-sport-organisers-rights_en.htm.


[1] http://www.lotteriinspektionen.se/sv/Press/Pressmeddelanden/Stockholm-Marathons-sponsorsavtal-kan-bryta-mot-svensk-lagstiftning/

[2] See e.g. C-34/79 Henn and Darby (1979) ECR 3795, para. 15; C-275/92 Schindler (1994) ECR I-1039, para. 32; C- 268/99 Jany and others (2001) ECR I-8615, para. 56, 90.

[3] EU law, however, precludes national advertising regulations according to which unauthorized gambling services organised in that Member State would be treated differently than unauthorized gambling services organised abroad. See e.g. Joined Cases C-447/08 and 448/08, Criminal proceedings against Otto Sjöberg and Anders Gerdin (2010) ECR I-6921.

[4] European Handball Federation, EURO Regulations applicable as from November 1, 2010, Article 22.

[5] European Handball Federation, Legal Regulations, Article 14.

[6]http://pilka-reczna.przegladsportowy.pl/Pilka-reczna-Vive-kontra-Izba-Celna-Poszlo-o-reklamy,artykul,117769,1,284.html

Comments are closed