Estadão: bookmakers and the limits of third-party brand and image use

In December 2018, then-President Michel Temer sanctioned Law nº 13/756, legalizing the sports betting segment in the country, leaving the later regulation to the Ministry of Finance. This regulatory process should have been completed by the end of 2020, but the work was hampered by the pandemic and the deadline was extended by another two years.

Therefore, the market’s expectation is that the regulation will be finalized this year, which has the main event of the football calendar: the World Cup. For the first time, the FIFA World Cup will take place in November and December depending on the weather conditions in the host country, Qatar.

In an article recently published in Estadão, André Carvalho Sica, André Thomas Fehér Junior and Alice Maria Gallia detailed one of the main guidelines to be included in the regulation of the Brazilian market regarding the limits of exploitation by bookmakers of image brands of sports associations and athletes. Check out the full text below:

Sports betting companies and the misuse of brand and image owned by third parties

Law No. 13,756/2018, enacted four years ago, legalized the sports betting market in Brazil, however, in article 29, the regulation of the activity is subject to subsequent regulation by the Ministry of Finance, which should take place by 2020. , as a result of the covid-19 pandemic, as well as discussions about the provisions of the aforementioned Law, this deadline was extended until the end of 2022, so the expectation is that the regulation will be approved later this year.

One of the important issues to be addressed in the imminent regulation would be regarding the limits of exploitation by companies in the sports betting market of brands, images and emblems of sports entities, athletes of the most diverse modalities. Today, in the text of Law No. 13,756/2018, there is no solid provision in this regard.

The urgency of tackling this issue in legislation is justified when we observe in television programs, radio, social networks, streaming platforms, sports betting companies indiscriminately and improperly appropriating the brands of the players in the sports market without any kind of authorization. .

Such practices constitute a clear violation of article 87 of Law No. 9,615/98 (Pelé Law) which guarantees sports entities protection regarding their brands, including their denomination and symbols, regardless of registration, guaranteeing them the right to use commercial, as well as professional athletes, the rights relating to their image rights, including names, denominations, symbols and sporting nicknames.

In the absence of any commercial agreements between companies in the sports betting market, sports entities and/or athletes, such practice constitutes, in addition to commercial discredit, brand counterfeiting and unfair competition, under the terms of art. 5, VII, of Federal Law No. 9,610/98 and articles 189 and 195 of Federal Law No. 9,279/96.

Still, under a careful look at what the regulation of the advertising market provides, the use of such properties without proper licensing constitutes a practice of “ambush marketing”, largely prohibited by national legislation. It is even what the Advertising Self-Regulation Code (CONAR) provides in its article 31, which expressly prohibits profits arising from the practice of advertising methods that are undue and illegitimate.

There are those who argue, however, that the assignment of rights over the brands of sports entities would be provided for and protected in Law 13,756/2018, specifically in its articles 17, item I, item i, 18, item I, item h, 20 , item V, 22, VIII and IX, 30, § 1, item III, which provides for the tax benefit of sports entities that cede the property rights over their brands for the dissemination and execution of the fixed-odds lottery.

However, when carefully observing the aforementioned legal provisions, there is no obligation for sports entities to carry out such assignment. It is a faculty, in exchange for tax benefits. Consequently, if the sports entity did not expressly intend to carry out the aforementioned transfer, the problem of improper use of the properties of the brands of clubs and athletes would remain.

Not least, it is worth mentioning that these articles say nothing about the use of the rights of athletes’ images by sports betting companies. Therefore, in the absence of the respective licensing for the use of such image rights, they could not be conveyed in any way by the betting companies, as they are very personal rights, constitutionally protected.

In this way, it is certain that, in order to increase the security of the sports market, and make the protection of brands and images of clubs and athletes even clearer, it is necessary that the regulation to be implemented by Law 13,756/2018 addresses this issue. Anyway, while the regulation is not enough, it is necessary for sports betting companies to adapt and observe the clear provisions that are already in the existing legislation. Otherwise, the practice of their activities may be liable to civil and criminal liability, in addition to being prevented from operating in the country.