The protection of IP rights in the new Brazilian sports law

The enactment of Law No. 14,597/2023 (known as General Sports Law – GSL) in June of this year marks a milestone for the protection of sports practice in Brazil, as well as of Intellectual Property rights derived from it. The Law seeks to consolidate all legislations related to sports practices in the country[1] and provides key mechanisms for the protection of commercial and IP related assets such as athletes’ right of publicity and performance rights, teams broadcasting rights (known as “arena rights”), advertising and commercial rights of sponsors and sport event organizers, as well as trademarks and other symbols of sports organizations.

Athlete Image Rights

GSL introduces new provisions regarding the commercial exploitation of athletes’ right of publicity by sports organizations, establishing, for example, maximum parameters for the compensation of such rights vis-à-vis employment contract – right of publicity compensation cannot exceed 50% of total employment contract. The law also establishes acceptable ways by which sports organization may use athlete’s personality rights during the term of their contractual relationship, such as use on organization´s official communication channels (social media, websites, magazines, and institutional videos), on promotional campaigns of the sports team.

Broadcasting Rights (“Arena Rights”)

As to broadcasting rights related to sport events, GSL reaffirms what has been long established by Law No. 9,615/1998, known as Pelé Law, assigning the right to exploit and commercialize the broadcasting of sports events to the hosting organizing sports entity[2]. The organization has the exclusive rights to negotiate, authorize, or prohibit the capture, fixation, emission, transmission, retransmission, and reproduction of images, by any means or process, of sports events in which it participates[3].

Advertising and Commercial Rights

The new law innovates by criminalizing the practice of ambush marketing, now defined by law as the unauthorized promotion of brands, products, or services for economic or advertising purpose by associating them with symbols owned by sports organizations and leading consumers to believe that such brands, products, or services are approved, authorized, or endorsed by any of the sports organizations involved the in the event (ambush marketing by association)[4]; or the unauthorized exposure or promotion of brands, businesses, establishments, products, or services in any way which may attract public attention at the location of sports events (ambush marketing by intrusion)[5].

Until the enactment of GSL, no specific legal provisions defined or regulated ambush marketing practices. Sports organizations have been combating such practices under the unfair competition provisions of the Brazilian Industrial Property Law but the express classification of the practice as a crime by the GSL has provided a more robust scope of protection for the commercial rights of sports entities, event organizers, and sponsors.

Counterfeiting

As established by the Brazilian Industrial Property Law – IPL (Law No. 9,279/1996), the reproduction, imitation, and falsification of any visually distinctive signs, their commercialization, and maintenance in stock constitute a crime. GSL brings stronger legal tools for combating counterfeiting of sport industry intellectual property rights[6] as it imposes more severe criminal punishment for when the intended purpose of such conduct is commercial or advertising.

Additionally, the GSL defines the terms “mascots,” “mottos,” “anthems,” and any other symbol owned by a sports organization, adapting the article to the sports context and expanding the scope of the indicated criminal types.

The new General Sports Law represents a significant milestone in the regulation of sports in Brazil, introducing important tools for the protection of IP rights, athletes’ personality rights, and for the combating of illegal practices such as ambush marketing and brand piracy.

If you would like to learn more about the legal implications related to the Brazilian General Sports Law, do not hesitate to contact our Marketing & Entertainment Law team.

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[1] It compilated articles previously provided for in the Pelé Law (Law No. 9,615/1998), the Incentive to Sports Practice Law (Law No. 11,438/2006), the Athlete Scholarship Law (Law No. 10,891/2004), and the Sports Fan Statute (Law No. 10,671/2003).

[2] Article 160. The broadcasting rights belong to the hosting sports organizations, which consists of the right to exploit and commercialize the broadcast of images, encompassing the exclusive prerogative to negotiate, authorize, or prohibit the capture, fixation, emission, transmission, retransmission, and reproduction of images, by any means or process, of sports events in which they participate.

[3] Article 160, §3. The sports organization holding the broadcasting and commercial rights inherent to the sports event may, in whole or in part, transfer them to other sports organizations that regulate the modality and organize competitions, which shall be done through a written document.

[4] Article 170. To promote brands, products, or services with the aim of gaining economic or advertising advantage by associating them with visibly distinctive signs, emblems, trademarks, logos, mascots, mottos, anthems, and any other symbol owned by a sports organization, without its authorization or that of a person indicated by it, leading third parties to believe that such brands, products, or services are approved, authorized, or endorsed by the sports organization owning the violated rights:

Penalty – detention, from 3 (three) months to 1 (one) year, or a fine.

Sole paragraph. The same penalty applies to anyone who, without the authorization of the sports organization promoting the sports event or a person indicated by it, links the use of tickets, invitations, or any kind of access authorization to sports events to advertising actions or commercial activities, with the intention of gaining economic advantage.

[5] Article 171. To display brands, businesses, establishments, products, or services or engage in promotional activities without authorization from the owning sports organization or a person indicated by it, in any way attracting public attention at the locations of sports events with the aim of gaining economic or advertising advantage:

Penalty – detention, from 3 (three) months to 1 (one) year, or a fine.

[6] Article 169. To import, export, sell, distribute, offer, or exhibit for sale, conceal, or keep in stock any visibly distinctive signs, emblems, trademarks, logos, mascots, mottos, anthems, and any other symbol owned by a sports organization or products resulting from their unauthorized reproduction, imitation, falsification, or modification for commercial or advertising purposes:

Penalty – reclusion, from 2 (two) to 4 (four) years, and a fine.