Who will draw the short straw in the dispute between Tina Maze and the Ski Association of Slovenia? The problems are much bigger than just being a sports and legal matter, even though the situation is quite clear from the latter point of view, and the arguments speak in favour of Tina. I certainly don’t want to prejudge the final solution, since the situation is quite complicated and the accusations go left, right and centre. However, in spite of all of this we can take a clear legal position on the sports-marketing practices.

From the short term point of view, skiing and Slovenian sport don’t benefit from such developments. From the medium and long term point of view, the mentioned conflict will significantly contribute to the development of sports marketing and sports law in Slovenia.

Various sponsorships – various rights

At the beginning, we must distinguish between sponsoring a club or association and sponsoring an individual. In sponsoring a club, the sponsor acquires the right to use the intellectual property rights of a club (its logo, its name …) and the marketing channels of the individual sponsored; while in sponsoring an individual, the person sponsored transfers the right to use her/his personality rights (name, photo, video material, nickname …) to the sponsor. The sponsor of a club thus does not automatically acquire the right to use the athletes in its marketing communication unless the athletes transfer a part of their personality rights to the club, resp. expressly agree with this kind of promotion.

In Tina Maze’s case, four different sponsorships are possible: sponsoring the Ski Association, sponsoring the Team to aMaze, sponsoring a person and as a sponsor which carries out an endorsement. The sponsors of the Team to aMaze in this case doesn’t represent a problem. Sponsors of a person are those that can – according to the rules of the Ski Association – advertise on Tina’s equipment for competitions or can be ‘illustrated’ as her sponsor on a representative jersey (e.g. Milka) in marketing campaigns. These sponsors of a person also don’t represent a problem since Tina can advertise them only with the consent of the Ski Association.

Endorsement

The endorsement is a quasi-sponsorship relationship based on selling the personality rights of an athlete (e.g. image, voice, nickname…) to a sponsor for the purposes of marketing communication. I say quasi-sponsorship because an athlete doesn’t usually promote such sponsors in other more traditional ways (e.g. logo on the equipment), but only by using the sponsor’s products; Tina and Zlatarna Celje for example (Tina is the face of their collection and wears their jewellery).

In the 21st century, sports draw its value from a massive visibility and popularity of sports stars; even in team sports where clubs are very strong brands and the athletes are raising the clubs’ value on the market. Individuals have become brands and as such, they represent powerful marketing tools. The usage of their personality rights, resp. their brand is therefore no longer possible without adequate compensation. The earnings of top athletes from the endorsements are much bigger than the amounts they receive for participating in sports. Let’s take Anna Kournikova for example who earned – via endorsements – nine times more than playing tennis. Michael Schumacher broke the magical boundary of one billion USD. It is clear that Schumacher wouldn’t be able to promote his endorsements within the Ferrari team, if the sponsor wasn’t sponsoring the team at the same time. This is also the case with Tina. As Tina Maze, she can appear in anyone’s marketing campaigns as long as there is no connection with the Ski Association. At the same time, the Ski Association can use Tina in its campaigns, also in ones that are a competition to her personal sponsors, if only the Ski Association respects the limitations and rules.

Skiers can refuse ads for the Ski Association’s sponsors

The sponsorship input gives the Ski Association and its sponsors the right to advertise on their ski jerseys or a billboard, and to use their title. Big sponsors also obtain the right to use skiers in their marketing campaigns, but only because the skiers agree and not because they transferred their rights to the Ski Association for using or even marketing their personality rights. The problems apparently occur because the contracts regarding the extent and manner of participating in marketing campaigns of the sponsors are differently interpreted.

Tina in this case hasn’t transferred her rights to the Ski Association for marketing, resp. using her personality rights. According to her contract, she is only committed to participate in a certain number of marketing campaigns of the Ski Association’s sponsors. In developed sports marketing environments, there is a long time accepted standpoint: the sponsor of the sports organization in such cases – as a part of its marketing campaigns – has to use at least three athletes at the same time. In the case of an ad for Citroën, Tina hasn’t breached her contractual obligations unless she expressly committed herself to the fact that in these kind of advertisements she will act alone.

For Tina, participating in such action would mean a reduction of her market value, since she would not be able to establish a business relationship with another automobile company and would not be able to make earnings. It is necessary to be aware of the fact that top skiers with good results earn money thanks to the pecuniary prizes and sponsorship contracts.

Inadequacy of Citroën campaign

The advertising campaign with Citroën cars, which was depicted on billboards, in this respect, interferes with the rights of athletes who appear in it, and from this viewpoint, it is inappropriate or unprofessional. From the content of the poster it is not possible to infer that it’s a sponsor of the Ski Association; it seems as it’s a sponsor of the skier in the ad (there’s only one skier in the ad and he is wearing an equipment of the Ski Association while the Ski Association’s logo is nowhere to be found). This means that each skier could refuse to participate in such marketing campaigns. Athletes should be informed in advance about the advertisement scenario so they could give their comments or decide to not participate in time. In the worst-case scenario, they should receive an appropriate fee for their participation and cooperation.

The argument of »helping the Association« or »supporting the youth selections« is inappropriate at this point. Athletes can help the Association with their good results, willingness to participate in marketing campaigns of the sponsors, which are in accordance with the law and general practice, and in many other ways. However, if an athlete refuses to participate in the campaign, which is not in accordance with the law and general practice, and does not receive adequate fee, it cannot be considered as an infringement of the rules.

Companies that are competition to the Ski Association’s sponsors

Tina therefore can participate in marketing activities of companies that are competitive to the Ski Association’s sponsors, but at the same time, there cannot be any kind of branding or other material that would establish a link with the skiing representative team or the Ski Association. Any kind of limitation of obtaining sponsors, resp. endorsements would be contrary to the European Union law, as it would limit the earning opportunities (such rule would hold up only in the event of an athlete being paid for this kind of engagement).

It is hard to imagine that Tina, with her champion status at the Ski Association, would earn significantly less due to such constraints, but it is all clear as far as the rest of the competitors are concerned. Average skiing representative team member who hardly earns anything with the prizes in competitions would be completely limited in getting her/his own sponsorship funds since all the sponsorship areas are already ‘full’ (banks, insurance companies, mobile operators, cars, sports shops …) and would only be able to focus only on finding small local sponsors. Recognising the fact that it is their profession and the fact that this year some of the athletes even had to contribute for their preparations, it is very likely that such limitations wouldn’t be supported in a judicial review.

The situation between Tina and the Ski Association is the same as between the football player and his club, for example. The sponsor of Real Madrid is adidas, while Ronaldo works with the Nike brand. Similar is the case in England where the Olympic Committee asked all Olympic athletes for their consent for sponsors to use them for commercial purposes.

Violation of contracts

Tina is reproached with concluding a contract with Tekanne, a competitive brand, due to a better offer, despite of having an established agreement with Žito. In law, the principle of »pacta sunt servanda« applies; it means that it is necessary to respect the contracts. In sports, it is especially important to be engaged in the right relationship with the sponsors since they can enable a sponsored person to earn more during her/his career. It is necessary to take into consideration that the time window of earnings in professional sports is short and above all unpredictable (e.g. trauma that can even end one’s career). It is clear that in Tina’s case, the economic interest prevailed and she went for – even though she allegedly already signed a contract with Žito – more profitable contract with a competitive brand. She acted in accordance with the well-known saying of »It’s not personal, it’s just business«.

The competing offer was obviously much better and despite of Žito’s very likely indemnity suit, Tina will be in a better financial position. However, it is necessary to emphasize that such cases are not a novelty abroad. The most notable example was when FIFA – in a conflict with the contractual provisions – concluded an agreement with Visa, the sponsor Mastercard suffered damage and FIFA had to pay 90 million USD of compensation. In its press release Mastercard stated that they don’t want to cooperate with FIFA ever again and this is probably the position of Žito, too. Tina’s team probably already considered this at the time of making a decision on cooperation with Tekanne.

Opportunity for Slovenian Advertising Chamber?

The question of advertising in sports could also be addressed by Slovenian Advertising Chamber, which could at this point at least set some basic criteria. In the case of appearance of only one athlete in an advertisement – when the advertiser is not her/his sponsor, but is the sponsor of the entire organization (club or association), we are talking about misleading the consumers. They do in fact identify much more with players than institutions. A typical case is a football representative team, where the fans identify with Samir Handanovič and not the Football Association of Slovenia. Thus, the TV ad of Hypo Bank – the general sponsor of the Football Association of Slovenia – seemed as if Hypo cooperates with Samir, resp. that Samir chose Hypo among all banks. That is not true, at least not as far as the ad is concerned.

Good epilogue in any case

Thanks to Tina, the Ski Association can undoubtedly enjoy more benefits from sponsoring the alpine representative teams. With some limitations, it can offer its sponsors advertising with Tina. This is correct. Moreover, that is exactly what represents Tina’s contribution to the Ski Association, of course besides fulfilling her other obligations.

Crises, disputes and disagreements have always been a driving force of development. In this case, too. An epilogue will outline new practices in the field of sports marketing in Slovenia. Nevertheless, it would be good if this happens soon, otherwise the future generations and not the current one will enjoy the fruits of today’s decisions.

The article was published in the online edition of Finance Daily, on 31 January 2016. Please find it here.