{"id":623,"date":"2024-07-25T09:40:06","date_gmt":"2024-07-25T07:40:06","guid":{"rendered":"https:\/\/vraneseviclaw.com\/?p=623"},"modified":"2024-07-25T09:40:07","modified_gmt":"2024-07-25T07:40:07","slug":"sponsorship-agreement-in-sports","status":"publish","type":"post","link":"https:\/\/vraneseviclaw.com\/en\/sponsorship-agreement-in-sports\/","title":{"rendered":"Sponsorship agreement in sports"},"content":{"rendered":"

T<\/span>he<\/span> s<\/span>ignificance<\/span> of<\/span> s<\/span>ports<\/span> s<\/span>ponsorship<\/span> a<\/span>greements<\/span> or<\/span> the<\/span> s<\/span>tory<\/span> of<\/span> Air<\/span> Jordan<\/span><\/span>\u00a0<\/span><\/h2>\n

Forty years ago, Nike invited Michael Jordan to design his unique sneakers. At that time, Jordan broke the NBA rule that required players to wear only white sneakers by wearing red and black sneakers in every game, resulting in a $5,000 fine per game, which Nike paid.<\/span>\u00a0<\/span><\/p>\n

However, in 1985, those sneakers hit the market, and although Nike aimed for $3 million in sales over a three-year period, by the end of the first year, sales had exceeded $126 million. This is the story of the world-famous Nike Air brand sneakers and Michael Jordan, who reportedly earned over $1.3 billion from his partnership with Nike.<\/span>\u00a0<\/span><\/p>\n

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Sponsorship agreements provide various benefits for both parties. Athletes increase their visibility and develop their own brands in partnership with the sponsor, resulting in a large portion of their earnings coming from these agreements. On the other hand, the sponsor benefits from the fame and positive public image of the athlete.<\/span>\u00a0<\/span><\/p>\n

Nike is one of the largest sponsors of athletes in the world and has signed lifetime sponsorship agreements with three athletes: in addition to Michael Jordan, Nike has signed such agreements with Cristiano Ronaldo and LeBron James.<\/span>\u00a0<\/span><\/p>\n

What does our law <\/span>say?<\/span><\/span>\u00a0<\/span><\/h2>\n

If we look at our judicial practice, specifically the Decision of the Commercial Court in <\/span>Ni\u0161<\/span> P. 440\/99, dated 4.5.2000, and the Decision of the Higher Commercial Court in Belgrade <\/span>P\u017e<\/span>. 4470\/00, dated 28.6.2000, we see the court’s reasoning that a sponsorship agreement <\/span>contains<\/span> all the elements of a bilateral onerous contract because sponsorship involves the patronage of an endeavor or the financing of a program, most often for advertising purposes. Sponsorship and donation, which equates to gifting, are not the same concept.<\/span><\/span>\u00a0<\/span><\/p>\n

Bilateral or bilateral onerous contracts are those in which both contracting parties have their rights and obligations, and simultaneously have the roles of creditor and debtor. For example, in a real estate sale contract, the seller\u2019s obligation is to transfer the property, while the buyer\u2019s obligation is to transfer the monetary amount. For the contract to be fulfilled, both parties must fulfill their obligations.<\/span>\u00a0<\/span><\/p>\n

Also interesting is the stance of the Higher Commercial Court in the judgment P\u017e. 1304\/01 dated 1.3.2001 regarding the principle of equal value of consideration, stating that this type of contract is not based on the identical value of material to the amount of money, as is the case with a classic sales contract.<\/span>\u00a0<\/span><\/p>\n

A sponsorship agreement is not explicitly regulated by the legal regulations of our country. The Law on Sports mentions it in a few places in terms of the income of sports associations and the potential income of top athletes. On the other hand, sponsorship itself is regulated by the Law on Advertising, which defines it as any form of financial or other support by the sponsor towards a natural or legal person and their activities for the purpose of promoting the sponsor’s name, brand, or mark, and products or activities.<\/span>\u00a0<\/span><\/p>\n

Although the Advertising Law is more focused on consumer protection and defines sponsorship in a broader sense, certain provisions of this law are imperative, meaning they cannot be deviated from. If you have read our previous texts, you are likely familiar with the principle of autonomy of will in contract law, which states that we are free to arrange contracts as we wish, as long as our desires and needs are not contrary to mandatory regulations, public order, and good customs.<\/span>\u00a0<\/span><\/p>\n

The Advertising Law thus stipulates the prohibition of misleading information, stating that sponsorship must be clearly defined. In other words, sponsored content must be labeled as such by indicating the name, mark, or other symbol of the sponsor and must not mislead consumers regarding the identity of the sponsor, the sponsor\u2019s activities, or the activity to which the sponsorship pertains.<\/span>\u00a0<\/span><\/p>\n

Furthermore, our law states that sponsorship must not limit the creative freedom of the sponsored party, their rights to independent management, and the determination of the goal and content of the sponsored activity. If the contract is concluded contrary to this legal provision, it is void. Also, the sponsor must not endanger the integrity of artistic expression through sponsorship.<\/span>\u00a0<\/span><\/p>\n

What is a <\/span>s<\/span>ponsorship <\/span>a<\/span>greement?<\/span><\/span>\u00a0<\/span><\/h3>\n

A sponsorship agreement is a bilateral onerous contract in which the sponsor commits to providing a certain amount of money to the sponsored party, who in turn commits to promoting the sponsor’s goods or services, or brand.<\/span>\u00a0<\/span><\/p>\n

Although this definition seems simple, a sponsorship agreement can be quite complex. When a sponsor concludes an agreement to promote their name, brand, trademark, and\/or products, they care deeply about who they are partnering with, aiming to associate and identify with the public image and successes of the sponsored party.<\/span>\u00a0<\/span><\/p>\n

Therefore, this agreement, especially in sports, is often concluded with regard to the personality of the sponsored individual, making it an intuitu personae<\/em> contract. When we conclude a contract with respect to the identity of one of the contracting parties, it means that the obligation must be performed by that specific person and that the contract terminates upon their death, with the contractual obligations not transferable to that person’s legal successors.<\/span>\u00a0<\/span><\/p>\n<\/p>\n\n\n

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A post shared by Jordan (@jumpman23)<\/a><\/p><\/div><\/blockquote>