This article was originally published in A Guide to
International Finance Centres: What Indian Investors Need to
Know, from Longtail International, June 2010
Jason Romer, Partner at Collas Day in Guernsey, provides
a case study of how image rights can be protected by using a
Well-known figures, from Bollywood stars to national sporting
heroes, have value attached to their image because they are so
recognisable. But how can they best protect this value and gain
As the following case study shows, Guernsey's Intellectual
Property legislation and favourable corporate tax regime offer a
solution and make Guernsey a very attractive place to base your IP
and image rights.
1. Famous cricketer X found that sales of
photographs of him in action and replicas of his team shirt were
becoming increasingly popular in the UK and India, where he has a
fantastic reputation. He was also being asked to endorse Kingfisher
beer in a series of advertisements on TV and in various magazines.
He wanted to maximise the revenue these opportunities were
To protect these image and IP rights in India or the UK could be
complicated and any derived income could be taxable at up to 50% in
Famous cricketer X may better choose to protect
and exploit his image rights using a Guernsey-based structure
however. The image rights are then held by a Guernsey company,
meaning that any income gained from licensing the right to use his
image is paid to the Guernsey company.
The company can be structured in such a way as to ensure that
limited tax is paid by the company on the income received.
Famous cricketer X may then choose to collect the
profits and gains at a time suitable to him, effectively protecting
his image and maximising its value to him.
2. Several years into the arrangement the Indian Cricket team
won the World Cup and Famous cricketer X found
himself a truly international star. The Guernsey company holding
his image rights was able to license the rights to the rest of the
world through an associated company within the EU, and
Famous cricketer X continued to take advantage of
the tax benefits, receiving income from worldwide licensing
3. His teammates also start to become recognised following the
win and want to take advantage of similar structures. The club sets
up a Protected Cell Company, with each member holding their image
rights in a separate Cell. This allows efficient management of the
team's IP under one corporate structure, with each player
owning shares in a separate cell (that is statutorily ring-fenced)
holding their own image rights.
4. After many years of continued success, Famous
cricketer X is now recognised worldwide as a sporting
superstar but with a large family decides he wants nothing more
than to step out of the limelight, retire and ensure that his
family can benefit from his worldwide reputation. Famous
cricketer X may have been well advised to establish the
structure using a trust that would allow him to benefit his family
long term. Guernsey has an excellent trust regime with well
established trustees, experienced with dealing with such
Guernsey is currently establishing itself as a market leader in
the management of image rights and, as the case study above shows,
protecting your image and other IP rights in Guernsey may be very
advantageous. Guernsey has well recognised and flexible corporate
and trust structures, and is looking at the potential for new
legislation to establish a unique registrable image right.
As reported in the market updates section of this newsletter, the UAE Ministry of Economy recently reviewed the fees charged by its various departments, including the Trade Mark, Patent and Copyright Office.
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