New Zealand: The breakdown - behind the scenes of a major sporting event

Last Updated: 18 October 2017
Article by Emma Turner

As with any commercial enterprise, major sporting events involve a number of important commercial relationships and require agreements to be put in place in order to operate successfully while minimising risks for those organising and participating in the event.

This article touches briefly on some of the key legal commercial considerations an event organiser will need to turn their mind to. This is a non-exhaustive list.

Sanctioned Events / Promoter Agreement

While some sporting events stand alone, most will be a part of a wider competition, series or tour and/or will be sanctioned by the national or international governing body of their relevant sport.

By way of example, the Australian Open is one of the ATP Tour's grand slam events and there will be a sanction/promoter agreement in place between the organiser of the Australian Open and the Association of Tennis Professionals governing the terms of that relationship.

An event sanctioned by the sport's relevant federation or other governing body gives the event immediate legitimacy. The New Zealand Rally is fighting hard to regain the sanctioned status that it previously enjoyed in 2012 as a round of the FIA World Rally Championship (WRC). Their campaign to be a round on the WRC in 2018, and now 2019 illustrates the significance that the affiliation and global exposure of the WRC as a whole has to the NZ event.

If your event is part of a tour, a wider series of events or officially sanctioned you will need to enter a sanction or promoter agreement. The terms that are included in such agreements are often vast, varied and detailed. As a promoter you will need to ensure that any obligations you are committing to are not inconsistent with any other commercial arrangements, including your agreement with the venue and sponsors.

Typically a promoter or sanction agreement will cover the following terms:

  • Obligations of the event organiser including providing certain operational facilities required for a sanctioned level event. The standard of player facilities, health and safety requirements, tickets, hospitality packages will all be covered.
  • Obligations of the governing body, including providing support to event, encouraging its athletes to participate and granting certain naming rights to the event.
  • Sanction Fee – consideration for the benefits the event enjoys by being sanctioned.
  • Intellectual Property – defining ownership and rights of use of each party's IP (name, logos etc).
  • Rights granted to the event by the sanctioning entity, and those retained (such as broadcasting rights).
  • The game, match or other sporting activity to be played in accordance with the rules of the governing body.
  • Sponsorship – certain restrictions may be imposed in respect of sponsorship, particularly around event sponsors competing in same category with sponsors of the relevant overarching Tour, series or national / international governing body.

Sponsorship

Sponsorship is a significant revenue stream for major sporting events and it can often be a delicate puzzle to piece together to ensure sponsor categories do not overlap, and you are not in breach of one sponsorship contract by granting a right to another sponsor, or even granting rights you do not have (i.e. those rights retained by the governing body in a sanction agreement).

Sponsorship agreements should be very prescriptive and not allow room for interpretation or any "grey areas". As with any other commercial agreement, both parties need to be clear regarding expectations, obligations and restrictions.

Key terms to consider for any sponsorship contract:

  • Term – how long is sponsorship arrangement for and are there any rights to renew.
  • Sponsorship fee – sponsorship can be either cash consideration and/or value-in-kind. If it is value-in-kind, ensure there is an agreed method for calculating such value or a pre-agreed value attributable to such non-cash contribution.
  • Exclusivity – some sponsors may want exclusivity in their category of business – for example if Ford is a sponsor, it will not want Holden also having its brand somehow associated with the event.
  • Benefits / rights of sponsor – set out the sponsor benefit package with sufficient detail so as to avoid disputes.
  • Definition the intellectual property rights of both parties and any rights of use.

Ticketing

As well as representing the right of a holder to enter an event, the ticket is a common tool event organisers can employ to impose certain rules and restrictions on attendees. This is important both from an event management perspective, such as providing organisers a right to remove any spectators who are acting in a manner in breach of the event rules, and from a commercial perspective, enabling the event to protect the valuable commercial rights associated with it, restricting spectators in respect of filming action or taking photographs.

If restrictions regarding filming and photographing an event are not covered off in the ticketing terms and conditions, it can significantly impact the value of the commercial rights the event is granting to sponsors, broadcasters and accredited news organisations who are paying for right to take/publish/use photos and film/broadcast footage of the event.

Ticketing can also help protect events from being subject to ambush marketing, and exposing itself to a breach of contract with existing sponsors. Ticketing terms and conditions can incorporate the necessary prohibitions on spectators, for example a term that prohibits attendees wearing clothing or bringing to an event a sign with logos of competing sponsors.

TV production / broadcast rights

Generally, the sale broadcast rights is the largest source of revenue for a major sporting event. The event owner, or where relevant the sanctioning body, will want to slice and dice their media offering to maximise revenues across the plethora of platforms available to today's sports fans.

If an event is part of a tour, or series the sanctioning entity may have a wider broadcasting deal already in place that the event will form part of, and the event's share of such broadcast revenues should be dealt with in the promoter agreement terms.

Alternatively, where the sanction agreement provides that the event organiser is responsible for television production, or where it a standalone event, you will be looking at an agreement with a local host broadcaster (e.g. Sky Sports or TVNZ) to produce coverage of the event. The host broadcaster agreement will set out the production and outside broadcast requirements for the event, and will also need to clearly set out who will ultimately own the copyright that subsists in the coverage produced by the host broadcaster. Typically the event organiser will retain these rights in order to have the ability to on sell to the broadcasters in other territories around the world.

To read more about the best broadcast opportunities for your sporting event, please see my article on the topic here.

Intellectual Property

While there is no copyright in an event itself, copyright lies in all of the surrounding materials, names, slogans, logos, branding and broadcasts of an event.

Event organisers need to have clarity as to any copyright materials that they wish to use, whether they own those rights or are being licensed them. "Sports events organisers should ensure that all IP rights that are used in connection with the organisation of a sports event are cleared and fully licensed to prevent allegations of infringement, and to avoid having major planned events stalled by way of injunction orders issued by the courts." (Law Gazette 2009, Lau Kok Keng, Rajah & Tann LLP, Singapore)

Other commercial arrangements

Various suppliers will be required to stage a major sporting event, from food and beverage suppliers to merchandising, commercial agreements will need to be in place with every key supplier.

For larger scale events, "Invitations to Tender" should also be considered as this type of market competition compels suppliers to offer their best terms and enables the organiser to better consider their options.

Other considerations

You will also need to look at local laws and regulations, resource consent will likely be required and coordination regarding traffic management and parking will also need to be considered.

When creating an event website, there is much to consider from a legal perspective. You need to ensure you have "terms of use" and a "privacy policy" for your website available for users to read. If tickets can be purchased directly through the site, you will also need to ensure a more detailed privacy policy is in place and being followed in respect of purchaser's personal data.

Event organisers must be aware and take pre-emptive action when it comes to protecting their legal position. Please contact our experts if you would like to discuss the legal needs of your sporting or other event.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions