The magazine SPONSORs published an analysis, according to which 30 Sponsorship agreements with a total value of 29 million of the 144 most important sponsoring partnerships of the 36 DFL clubs expire at the end of the season. The extent to which contracts will be further delayed, sums or even advertising space will remain free is difficult to forecast at present. difficult to predict at present.
Besides the view into an uncertain future existing contracts with partners and sponsors are in jeopardy due to the Crisis in particular focus. As much as we all hope that the health consequences of the of this virus` will remain manageable, they are already economically enormous.
It is therefore all the more important that companies also act with a sense of proportion in legal dealings, know their options for action, and be aware of optional scenarios are prepared in the best possible way.
When evaluating the options The special situation in sponsorship must be taken into account when evaluating the options for action. normal advertising business, for example, if the advertising platform were to be switched off. would no longer be paid in monetary terms, for example, the authentic collaborations between sponsor and club is characterized by a partnership "through thick and thin. through thick and thin. If one considers the shitstorm and image damage, the sporting goods manufacturer adidas caused by suspending its rental payments. it is conceivable how a fan would appreciate the thoughtless reactions of a sponsor of his favorite of his favorite club. But even this "Intangible Value" must ultimately be measured against the controlling and compliance of the sponsoring company. of the sponsoring company.
In this context, the rights holders in particular represent existing sponsorship agreements present a particular challenge due to the usually quite complex bundle of advertising/media rights, tickets, boxes, trademark rights and personal rights. Two points of view are explained in more detail below, which are legal assessment and the Evaluation of the underperformance or damage.
Lawyer Guido Kambli, head of the sports law crew of the BAY GmbH Wirtschaftsprüfungs- und Rechtsanwaltsgesellschaft from Munich explains:
1. initial situation - corona crisis
As things stand at present, there are to be Bundesliga and 2nd Bundesliga from the end of May - without an audience, but broadcast on television and online. In the worst case, the the remaining match days will be canceled by the DFL, and the season will end prematurely. In principle, even in times of crisis, the principle "pacta sunt servanda" - Contracts must be honored: The soccer clubs or soccer corporations (hereinafter collectively referred to as "associations" or "clubs") must provide the contractually agreed advertising services in full, and the sponsors must pay the sponsors must pay the agreed remuneration in full - if they fail to do so, they may be threatened with termination of the contract, reduction of payment or damages, unless otherwise provided for in the clauses to the contrary or statutory regulations or the provisions of the or the principles of "force majeure principles of "force majeure" developed by the courts.
2. scenario ghost games
If, as is highly probable, the "ghost games" occur, both "ghost games", both contracting parties are, until their implementation, according to § 275 of the German Civil Code (BGB) from their obligation to perform (since a case of temporary impossibility exists and the advertising services are regularly not "fixed transactions fixed transactions" subject to a time limit). As soon as the games take place the clubs can fulfill their contractual obligations (with a time lag) in part or in full and obligations (with a time lag) and, in particular, to provide the media-relevant services such as advertising on the jerseys, perimeter advertising, sponsor logos on the interview screens interview walls, partial use of club-owned rights or online presence of the sponsor. of the sponsor. Other services that are directly related to the event and the stadium, such as the provision of business seats, hospitality measures or printing of the sponsor's logo on the spectator day day tickets for spectators, are not provided. In such a constellation, the sponsor must sponsor must pay for the services provided. Only in respect of the measures not performed, the sponsor can reduce his payments appropriately or or demand a pro rata refund from the club - unless the parties to the contract have parties do not agree in advance on an adjustment of the contract within the meaning of Section 313 of the German Civil Code (BGB). Claims for damages by the sponsor are generally ruled out, as the clubs are not responsible for the exclusion of the spectators. clubs are not responsible for the exclusion of the spectators. Something else applies if the sponsorship agreement contains guarantees or so-called force majeure clauses. force majeure clauses that open the way for the sponsor to claim damages. compensation.
3. scenario season cancellation
If it comes, which, according to current knowledge, is extremely unlikely, the season will be season is cancelled, the remaining games will be cancelled. The temporary becomes becomes a permanent impossibility, at least as far as the implementation of media media-relevant, matchday and stadium-related rights and services. are concerned. The legal consequence of this is that the soccer clubs are released from their obligation to from their obligation to provide such outstanding advertising measures pursuant to § 275 of the German Civil Code since neither they nor a third party can provide the service. The sponsor is no longer obligated to pay its outstanding remuneration under § 326 BGB. outstanding remuneration; in addition, it may demand the return of any payments already payments already made and may withdraw from or terminate the sponsorship contract if the or terminate the sponsorship agreement if there is good cause. The amount the amount of any reclaims and the existence of good cause shall be determined be determined on a case-by-case basis. In principle, the decisive factor is what the parties have contractually agreed with each other. Only if contractual provisions are missing, incomplete or insufficiently detailed, the legal provisions just described come into play.
In many sponsoring agreements contain force majeure clauses. These contain agreed between the parties for the occurrence of unavoidable events ("force majeure"). for the occurrence of unavoidable events ("force majeure"). Force majeure According to the case law of the German Federal Court of Justice, force majeure is defined as an external event external event that has no operational connection and cannot be avoided even by the utmost which cannot be avoided even by the utmost care, and which cannot be attributed to the spheres of the spheres of the contracting parties. Whether a corona-related violation of contractual performance obligations constitutes such a case of force majeure is has not yet been decided by the highest courts, but there are many arguments speak in favor of it. As is usually the case in jurisprudence, the circumstances the circumstances of the individual case are decisive. What must be taken into account what the sponsoring service relates to and where the focus of the services lies. focus of the services, and secondly, whether certain guarantees or conditions, such as performance periods conditions such as performance periods, whether cases of force majeure have been expressly cases of force majeure have been expressly defined, and which information and and cooperation obligations of the parties in connection with the possible occurrence of a performance of an impediment to performance. If the conclusion is reached that force majeure force majeure exists, claims for damages are ruled out.
Marcel Cordes, partner of the consulting agency SPORTHEADS supplemented:
The second essential aspect besides the legal situation relates to the shortfall in performance or the amount of the of the damage and, if applicable, its compensation. Modern sponsoring agreements usually, but not always usually, but not always, include clear catalogs of performance and consideration. Particularly in the definition of advertising rights, performance-based components that relate to the league table situation, promotion and relegation, and qualification for for international competitions, for example, are common standard. Bonus/malus clauses based on media sponsor visibility, the reach achieved or the or the advertising equivalent value (AVE) generated are not only common in naming right not only in naming rights contracts.
In order to assess an underperformance, it is the first step, it is important to differentiate the various contract components and benefit differentiate between the various contractual components and benefit commitments as far as possible and to individually. This is the only way to identify the areas areas where full performance appears impossible due to the Corona crisis (e.g. the Corona crisis (e.g., public tickets, VIPs, non-media-relevant media-relevant advertising space in the stadium, promotion, stadium TV). In other performance of the contract may not be possible within the agreed period, but can be agreed period, but can still be fulfilled on the basis of the scenarios in question (e.g., for the mostly dominant media-relevant advertising spaces).
The starting point here is the contractual agreements: Are media performance values contractually defined for the performance values are contractually defined for the media elements of the sponsorship agreement - conceivable conceivable here are clauses for achieving a defined CPM (thousand-contact price) as a ratio of the sponsorship sum attributable to the media visibility divided by media contacts achieved - the calculation is facilitated.
If only the display of the media-visible advertising If only the display of advertising space visible in the media is contractually owed - and this will be the most frequent case this must be considered in connection with clauses on the operation of the game. operation of the game.
Whether the game plan at the end of the season 19/20 season will ultimately lead to an increase or decrease in media performance. cannot be conclusively assessed at present. The approximately 1.1 million average stadium attendance per matchday will, in the event of ghost matches, reduce the the media reach of the Bundesliga and 2nd Bundesliga if ghost matches are held. significantly. For the calculation of the compensation, this effect should be and a reference value, e.g., from last season, should be used as a basis, should be used as a basis.
With all legal and contractual possibilities, To disengage from existing, unfulfilled contracts, claims for damages or compensation payments, the goal should always be a compensation payments, the goal of a joint, amicable solution between the contractual solution between the contracting parties should always be in the foreground, in order to lay the groundwork for a sustainable for sustainable, trusting and fair cooperation in the period after the Corona crisis. the Corona crisis.
Ultimately, and this is shown by examples such as the the behavior of Borussia Mönchengladbach's sponsors, which already has a positive connotation in the press. Mönchengladbach, most sponsors and partners of a club see themselves as part of the community as part of the community and may benefit, particularly in times of crisis, from a positive image gain. At the same time, the parties should clarify which options for action exist in the contractual sense and how any potential damage can be calculated and, if necessary, compensated.
In any In any case, sponsors and marketing agencies will consider adding a force majeure clause to future contracts to include a contractual provision on the subject of "force majeure," and to and to ensure that the wording also covers obstacles to performance in cases of cases of epidemics / pandemics / plagues.
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