Combatting Ambush Marketing of Sports Events in South Africa
By Razia Mahomed, School of Law, UNISA, Pretoria, South Africa
Introduction
When one thinks of ambush marketing in South Africa, the first thing that comes to mind is the marketing tactics used at the FIFA 2010 World Cup, where 36 Dutch women wore orange mini-dresses sponsored by Bavaria Beer (a non-sponsor) during the Netherlands-Denmark match. The stunt made international headlines, but more importantly, it exposed the enforcement challenges surrounding ambush marketing regulation in South Africa.
Defining Ambush Marketing
Simply put, it is a marketing strategy in which a company seeks to associate itself with an event, typically a major sporting event, without paying any sponsorship fees. The company capitalises on the public interest of the event to gain exposure, often at the expense of the official sponsors. Brands usually invest significant amounts of money to sponsor an event and as a result are granted the legal right to display their trademarks at the event and to use official trademarks associated with the event on their products. This unique marketing opportunity afforded to the sponsor is used to boost their reputation. However, other brands seek to associate themselves with these events through alternative means.
Essentially ambush marketing can take two forms: ambush marketing by association; or ambush marketing by intrusion.
When a brand seeks to associate itself with a sports event by using the trademarks of that event and misrepresenting that it is a sponsor to the public, it is known as ambush marketing by association.
Ambush marketing by intrusion is when a brand seeks to gain exposure for itself and its trademark by using the events publicity without the authority of the event organiser.
Whilst ambush marketing may initially appear to be a smart or creative advertising strategy operating in a legally grey area, it raises significant legal and commercial concerns. It undermines the value of official sponsorship agreements by allowing non-sponsors to gain comparable exposure without paying the required fees. This dilutes the exclusivity that sponsors pay significantly for, diminishes their return of investment and can deter future sponsorship. These commercial harms have led to increasing pressure on event organisers and legislators to adopt clear legal frameworks to regulate ambush marketing and to protect the integrity of sponsorship agreements.
Early legal tools: Common Law and Intellectual Property
Before specific legislation was enacted, organisers and sponsors relied on the common law of passing off to prevent false association; Trademark law to protect logos, slogans and branding; and Copyright law to protect original creative content, such as event themes and logos.
Passing off is a common law remedy that forms part of the broader doctrine of unlawful competition. Passing off safeguards businesses and individuals from unfair competition and misrepresentation. In South Africa, passing off is a recognised cause of action that allows businesses to protect their reputation, goodwill and brand identity. The Trade Marks Act 194 of 1993, specifically section 34 (1)(a) – (c), protects registered trademarks from unauthorised use that is likely to cause confusion. The Copyright Act 98 of 1978, specifically sections 21 and 27, protect the exclusive right of copyright owners and regulates the infringement of copyright, respectively.
Other legislation that assists with combatting ambush marketing is the Consumer Protection Act 68 of 2008, which prohibits misleading advertising and may be applied where consumers are misled about sponsor relationships, and the Electronics Communications Act 36 of 2005, which regulates broadcast rights, which can be relevant when assessing unauthorised visibility.
Due to the limitations of these common law and statutory provisions, particularly in addressing indirect associations of brands with events, statutory reform became necessary.
The Merchandise Marks Act 17 of 1941
The FIFA 2010 World Cup was a turning point for South Africa regarding ambush marketing.
In order to meet FIFA strict sponsorship requirements, South Africa enacted amendments to the Merchandise Marks Act 17 of 1941. Section 15A was enacted to specifically regulate the abuse of trade marks in relation to sports events.
Section 15A enables the Minister of Trade and Industry to declare an event as a ‘protected event’ provided that it is in the public interest and the Minister is satisfied that the organisers have created sufficient opportunities for small businesses, particularly those from previously disadvantaged communities.
Section 15A further provides that, during the specified period of the ‘protected event’, no person is permitted to make use of a trade mark relating to the event to achieve publicity or promotional benefit unless an official sponsor.
The use of a trademark includes:
(a) visual displays
(b) audible reproductions
(c) promotional activities
which directly or indirectly associate or suggest an association to a protected event.
Non-compliance constitutes a statutory offence.
The Constitutional Challenge
Although South Africa has statutory measures that are event-specific and protect sponsors, particularly the Merchandise Marks Act 17 of 1941 (as amended), the constitutionality of such measures raises significant questions about the limit of state power in protecting commercial interests vis-à-vis fundamental rights, such as freedom of expression, economic activity, and property rights.
The primary concern is the tension between the protection of commercial rights to event sponsors and the constitutional rights of non-sponsor entities and the public.
Section 16(1) of the Constitution of the Republic of South Africa, 1996 guarantees the right to freedom of expression, which includes commercial speech. Non-sponsor entities have argued that their indirect or humorous references to major sports events are forms of expression, rather than unlawful association.
Section 22 of the Constitution protects the right to choose and practice a trade, occupation, or profession. Blanket prohibitions on all non-sponsor marketing near event venues, especially without evidence of actual deception, may constitute an unreasonable limitation on that right, particularly for small, local businesses that are disproportionately affected by enforcement actions.
Sponsors and event organisers commonly assert intellectual property (IP) rights over trademarks and commercial goodwill to protect their investments. However, Section 25 of the Constitution protects property rights only to the extent that they are not used to unjustifiably curtail others’ rights. A wide interpretation of ‘association’ may result in appropriation of public symbols or national identity, which arguably belong in the public domain.
The limitations clause in Section 36 of the Constitution allows rights to be limited only when the limitation is reasonable and justifiable in an open and democratic society. Courts must weigh the interests of sponsors in recouping their investments against the broader public interest in market competition, economic freedom, and open expression.
Conclusion
The South Africa regulatory framework has evolved to offer strong protection against ambush marketing, particularly during major sports events. However, this protection must not come at the expense of constitutional rights, such as freedom of expression, economic activity and property rights.
As South Africa prepares to host future sports events, the challenge will be to strike a sustainable balance between sponsor exclusivity and constitutional values to ensure that protection does not become suppression.
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