Ambush marketing and the 2022 Rugby World Cup Sevens

With the upcoming Rugby World Cup Sevens being hosted at the Cape Town Stadium (purpose built for the 2010 FIFA World Cup), one cannot help but think back to the FIFA World Cup and the ambush marketing tactics on display before and during the tournament. While orange minidresses may not be at play this year, it will be interesting to see what ambush marketers have up their sleeves for the rugby.

What is ambush marketing?

Ambush marketing occurs when a brand seeks to benefit from the publicity surrounding an event, such as a major sports competition, despite not being associated with that event and having made no monetary contribution to it. Brands will often pay millions of Rands to sponsor an event like the Rugby World Cup Sevens. As a result of this sponsorship, the brand will usually be granted the right to display its trade marks at the event and will also receive the right to use the trade marks associated with the event. The brand is thereby afforded a unique marketing opportunity to boost its reputation. However, not all brands can bear the cost of sponsorships, and will instead seek to associate themselves with events through alternative means.

Ambush marketing can essentially take two forms. A brand may seek to mislead the public into believing that it is a sponsor of an event by using the trade marks of that event (or confusingly similar marks) and misrepresenting that it is associated with the event (known as ambush marketing by association). Alternatively, a brand may seek to gain exposure for itself or its trade marks by taking advantage of the event’s publicity without the authorisation of the event organiser (often referred to as ambush marketing by intrusion).

The Merchandise Marks Act

Ambush marketing can undermine the commercial exclusivity and repute of the event organiser’s official marks and may affect its ability to secure sponsors for future events. Fortunately, South Africa has various laws in place which regulate ambush marketing. Besides your more traditional remedies like trade mark infringement, unlawful competition and copyright infringement, the Merchandise Marks Act 17 of 1941 (as amended) contains provisions for declaring certain marks as “prohibited” and for declaring certain events as “protected”.

The Merchandise Marks Act and ambush marketing by association

The Minister of Trade, Industry and Competition recently prohibited the use of the following marks (or similar marks) which might cause confusion with the 2022 Rugby World Cup Sevens: RUGBY WORLD CUP SEVENS, RUGBY WORLD CUP SEVENS SOUTH AFRICA 2022, RUGBY WORLD CUP, RWC SEVENS, RWC7s and the associated logos, save where the use thereof is by the authority of Rugby South Africa. The Minister is empowered to do so in terms of Section 15(1) of the Merchandise Marks Act. Proprietors of identical or similar marks already in use are not affected by this prohibition.

The provision makes it an offence for a brand to use the Rugby World Cup Sevens marks to confuse the public into believing that it is in some way associated with the event. In doing so, the provision seeks to prevent ambush marketing by association.

The Merchandise Marks Act and ambush marketing by intrusion

Section 15A of the Act makes it an offence for a brand to use its own trade mark in relation to a protected event in a manner which seeks to achieve publicity for that trade mark and thereby derive special promotional benefit from the event, without the prior authorisation of the event organiser. Use includes any visual representation or audible reproduction of the trade mark in relation to goods or services, or in promotional activities, which in any way, directly or indirectly, is intended to be brought into association with or allude to the event.

The Minister recently declared the 2022 Rugby World Cup Sevens as a “protected event”, on the understanding that the event is in the public interest and that the SA Rugby Union (the event organiser) has created opportunities for South African businesses, in particular those from previously disadvantaged communities, as required by the Act. The protection shall be in place from 1 to 21 September 2022.

It seems bizarre that a brand may be prevented from using its own trade mark. To add context to this provision, let us go back to 2010 and the case of FIFA v Metcash Trading Africa (Pty) Ltd (2009) JOL 24382 (GNP). In that case, Metcash had been selling lollipops during the period in which the 2010 FIFA World Cup had been declared a protected event. The lollipops were sold under Metcash’s own trade mark, together with the words “2010 POPS”, a partial depiction of the South African flag and depictions of soccer balls. The Court found that Metcash’s conduct constituted unlawful competition in that it contravened Section 15A of the Merchandise Marks Act. The Court held that Metcash intended to derive special promotional benefit from the event in the marketing of its lollipops, and that its sales had increased as a result. While other sponsors and licensees had paid for the use of their trade marks, Metcash had benefited from the association for free.

It remains to be seen what ambush marketing tactics will be employed at the 2022 Rugby World Cup Sevens, but it will certainly be worth it to follow along.

Michelle Langeveld
Associate | Attorney
[email protected]