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Ambush Marketing & The Rugby World Cup

Planning to capitalise on the Rugby World Cup in 2011? Make sure your plans do not leave you open to accusations of ambush marketing and a hefty fine. Ruvini Rendle, a senior solicitor and IP specialist at Duncan Cotterill, looks at the legal issues.
With the Rugby World Cup on the horizon, you may be thinking about how to make the most of having the world on New Zealand's doorstep.

And you'd be right to do so, but a word of advice. Tread carefully when marketing your plans.

Ambush marketing, which has previously been regarded merely as 'sharp' business practice, is increasingly frowned on. So much so, that in preparation for the Rugby World Cup, the Government has introduced anti-ambush marketing legislation as part of a Major Events Management Bill.

What is ambush marketing?
The practice of ambush marketing describes marketing campaigns that obtain publicity for products or services by taking advantage of the event without having to enter into a contract with the event organiser (which usually involves making a financial contribution)!
Given the myriad of marketing innovations today, it's difficult to exhaustively list all the types of conduct that could constitute ambush marketing. However, there are generally two types of ambush marketing:

• Ambush marketing by association gives the public the impression that you are officially associated with the event.
• Ambush marketing by intrusion is when you undertake activities at an event or close to an event venue - often without any claim of association - and gain publicity, to which you are not entitled.

There are many well-known examples of ambush marketing at major events. Take these, for instance,

At the FIFA World Cup 2006, brewery BAVARIA distributed to Dutch football supporters pairs of bright orange trousers with its brand name emblazoned in defiance of the official sponsor's beer brand - Anheuser Busch's Budweiser. (The trousers were confiscated and some supporters allegedly watched the Netherlands beat Ivory Coast 7-3 in nothing but their underwear)!

At the 1996 Atlanta Olympics, Nike placed numerous billboards around the event venues, handed out Nike 'Swoosh' flags to wave and put up a significant hospitality 'media centre' immediately outside the venue. Surveys indicated that the public believed Nike was an official sponsor of the Olympics, when in fact Reebok - among other sponsors - had paid $US 40 million to become an official sponsor.

Why legislate against ambush marketing?
The impetus to outlaw ambush marketing comes from the organisers of major international events. If ambush marketing is rampant, it could reduce the value of official sponsorship, which may in turn hinder sponsorship funding, potentially influencing the viability of future events. In recent years, event organisers have insisted that prospective host nations provide adequate protections for event sponsors (for example, anti-ambush marketing legislation is already in place in England ahead of the 2012 Olympics to be held in London). New Zealand is no exception.
It is true that existing legislation and legal actions - the Trade Marks Act, Fair Trading Act and the tort of Passing Off - could be used to address some instances of ambush marketing. However, the proposed legislation would go further by outlawing cases of ambush marketing where there is no use of official trademarks or where it is clear that the advertiser is not an official sponsor.

The Major Events Management Bill
The Major Events Management Bill will apply to events that the Government considers should be protected. Events which attract international exposure (through participants and spectators) and which provide substantial 'benefits' to New Zealand, are expected to receive protection. For instance, the legislation is likely to also apply to the ICC Cricket World Cup to be hosted by New Zealand in 2015.'

While the aim of the ambush marketing provisions in the Bill is to stop the practice, the scope of what is actually illegal is carefully defined. There are measures to balance legitimate commercial interests with the protections given to event organisers. There will be defined time periods ('clean periods') and 'clean areas,' around which the protections apply and a number of exceptions for existing legitimate business interests. Central to what marketing is not permitted, is whether the marketing in question gives the impression that the enterprise is in some way officially connected with the event.

Recognising that civil procedures may not be sufficiently swift to address immediate cases of ambush marketing, the Bill provides powers for 'enforcement officers'to immediately confiscate offending material, remove offending advertising and enter premises in limited circumstances (under a search warrant).

Another interesting aspect of the proposed legislation is the suite of enforcement provisions. There are significant penalties for instances of ambush marketing by association or intrusion - a fine of up to $150,000 in each case.


Progress of the legislation
The Major Events Management legislation is expected to be in force by July 2007 to coincide with the commencement of the Rugby World Cup in France.

So before you commit to a marketing campaign to coincide with a major event, you may want to run your plans past your legal advisor first.

Ruvini Rendle is a senior solicitor at top 10 law firm Duncan Cotterill, which has a specialist IP team. R.rendle@DuncanCotterill.com