Brazil: Brazilian President Sanctions The World Cup Law

On June 5, 2012 the Brazil President Dilma Roussef signed into law the World Cup bill providing for a set of rules that regulates the Brazil's staging the 2014 FIFA World Cup and gives FIFA guarantees on the organization of the event.

After months of discussions that basically focused on the sale of alcoholic beverages inside stadiums and half-price tickets, the long-running process to formalize the law regulating the hosting of the event by the country took its first significant step forward in March after the House of Representatives passed it.

The main sticking point in approving the World Cup bill had been the permission for alcohol sale at stadiums. Brazil currently prohibits consumption of alcohol at sports events in stadiums; however, due to a prior commitment between the Brazilian government and FIFA, the Brazilian President lifted the federal law provision that bans alcohol sale at sports events in stadiums, and therefore, opening the way for sale of alcohol at World Cup matches. The World Cup Law (Law 12,663/2012) does not specifically allow alcoholic beverages sales in stadiums during tournament, which will in theory require that FIFA negotiate with a few states whose local laws currently ban alcohol sale inside stadiums during sports events. Several out of the 12 Brazilian states hosting the World Cup matches have laws that currently prohibit alcohol in stadiums.

Another controversial issue was the provisions dealing with the Federal Government liability for any safety problem. The new law establishes that the Federal Government shall assume civil liability to FIFA for any damages arising or having arisen from any safety-related incident or accident in connection with the tournament.

The World Cup Law also addresses rules protecting commercial rights by creating commercial restriction areas in the surroundings of the tournament venues, including stadiums, training centers, media centers, accreditation centers, parking areas, among others, where FIFA and its partners will have exclusive right to advertise, distribute and sell their products and services, in addition to carrying out other promotional activities. For this purpose, the law delegates to local authorities the responsibility to establish the limits of such commercial restriction areas, provided that such limit will not exceed the maximum range of 2 km around competition venues.

Furthermore, the World Cup Law faces a quite sensitive issue concerning territorial delimitation and control over advertising that could spark a discussion on freedom of expression and free competition on the part of companies that are not official sponsors. Such delimitation could in some circumstances be challenged if it represents an infringement of third parties' vested constitutional rights. Accordingly, the Brazilian lawmaker gave reasonable protection to business operations organized lawfully and prior and unrelated to the event by setting forth that "the exclusive area boundaries shall not affect the regular activities of business ventures already operating, provided the latter is not associated in any way with the tournament."

The World Cup Law also imposes a set of rules granting special protection to the industrial property rights held by FIFA and its partners. Among the introduced measures, special emphasis will be given to the criminalization of practices related to ambush marketing by association and ambush marketing by intrusion.

Ambush marketing practices are common in large events such as the World Cup; therefore, FIFA has a history in adopting global measures to fight ambush marketing and is already concerned in banning non-sponsoring associations from the matches in Brazil.

In this regard, the law provides for severe penalties for ambush marketing practices, i.e. the adoption of commercial and advertising maneuvers associating the name, brand and/or other distinctive signs of the event to entities that have not acquired sponsorship quotas and the display of brand, product, services, establishment or the performance of promotional activity within the tournament venues by persons or entities not authorized by FIFA or its commercial partners.

Furthermore, the law provides for special trademark protection rules for FIFA, among which: record with the INPI (the Brazilian Patent and Trademark Office) of high reputation registers of the trademarks consisting of FIFA's official symbols, emblems, mascots and other symbols indicated by FIFA; the record with INPI registers of well-known trademarks held by FIFA; adoption by INPI of a special regime for procedures related to applications for trademark registration filed by or relating to FIFA.

Further to the aforementioned points, the law also sets rules on civil penalties, broadcasting rights, sales of tickets, entry visas and work permits, among others.

Authors: Tatiana Campello Lopes - partner at the law firm Demarest e Almeida Advogados and Guilherme Cacciari Veloni - associate at the law firm Demarest e Almeida Advogados

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