Rule 40 and the Olympics

The impact of the Coronavirus and pandemic cancelled sports for a long time, including the 2020 Summer Olympics. With the rebrand to the 2021 Summer Olympics, the games will finally be played, and everyone will be able to watch some of the best athletes in the world compete against each other for a gold medal. On top of the athletes returning, we are also going to have the return of sponsorship activations and commercials. This will cause people to talk about Rule 40, the new amendments, and how the different committees might be able to track the different athletes. The rest of this post will talk about the background of Rule 40, how it will be governed for the Tokyo Games, and the impact it has on the event as well as the athletes.

For starters, The Olympics, specifically the IOC, has always charged a lot of money for brands to become Official Olympic Partners. This has always been the case since this is an international event that is viewed by millions of people globally. Since these companies are paying so much money in partnerships fees, the “International Olympic Committee has been very strict about what athletes can do with their personal partners.” (SportsPro) The IOC has tried to prevent as much ambush marketing as possible to protect their partners. “Ambush Marketing is when a company advertises around an event without specifically mentioning the event or paying for a partnership activation.” (Law In Sport) For example, a company might produce a commercial talking about the “big tournament” in reference to March Madness, but they do not pay the millions of dollars that come with being an official sponsor.

The IOC created Rule 40 to prevent nonofficial partners the opportunity to promote their brand or products. This rule created a “Blackout Period” 1 week before the beginning ceremonies of the Olympics and 3 days after closing ceremonies. “Any personal sponsors that we not official Olympic sponsors could not mention their athletes and the athletes could not mention their partners.” (Law In Sport). At the 2012 Olympics, athletes protested Rule 40 by helping their personal brands in different ambush marketing strategies. They also used their social media platforms to promote their partnerships and thank them for their success in the Games. This forced the hands of the IOC to relax Rule 40 for the 2016 Rio Olympics. The IOC’s compromise was to allow non-official partners to affiliate with their athletes as long as they were not compromising or using any Olympic names, symbols, or affiliated language. However, these athletes had to “submit paperwork long before they were invited to their national team,” so a lot of these athletes were still unable to promote their personal partners (Lexology).

In 2019, the German Cartel Office, which oversees the German Olympic team, “decided that their athletes would no longer follow the IOC ruling and that they could promote their personal partners.” (Reuters) This forced the IOC to revise Rule 40 for the 2020, now 2021 Olympics in Tokyo. The IOC made a third amendment that states “Competitors, Team officials, and other team personnel who participate in the Olympic Games may allow their person, name, picture or sports performances to be used for advertising purposes during the Olympic Games as long as they are in accordance with the IOC rules.” (Lexology) This will allow athletes to interact with non-official sponsors while at the Olympics.

The amendment states that these athletes may post one “Thank You” message per non-official partner and the brands may send one “Good Luck” message to the athlete before or event they compete in their event. However, these messages can not contain “any Olympic Properties, images or videos from Olympic venues or medal ceremonies, feature the athletes official Olympic team uniform, include any endorsement of a specific product or service, or suggest that a product or service helped their performance.” (Athlete365) The company also has to alert the NOC of the athlete of any advertising promotions before May 15th.

I personally think that there are pros and cons to the revisal of Rule 40. The biggest pro is that this will help these athletes market themselves and make more money. These Olympians do not make any of the sponsorship money that the International Olympic Committee makes when selling international partnership deals. Since they are now allowing athletes to promote their own personal sponsors this will give the athlete and their agent more leverage when approaching a brand about a potential partnership. The athlete can use the promotion through the Olympics as an advantage to make more money from a partnership. These brands also win because they have the opportunity to grow their image through this athlete and their current fans as well as any fans the athlete might obtain through the Olympic process.

There are still a lot of problems and areas of improvement that the Olympics and the IOC could do to help out their athletes. I believe that the next problem that could arise from Rule 40 is that the NOC’s are still in charge of the athletes’ decisions. The NOC is the National Olympic Committee, and each participating country has one. Each individual NOC is allowed to determine if their athletes can post these “thank you” messages and interact with the personal partners. The NOC makes sure that the country’s partners are being interacted with and they ultimately determine the fate for their athletes’ personal partners. Countries such as the United States, Germany, and England are allowing their athletes to interact with Rule 40, but some of the smaller countries have not made their decision or are not allowing their athletes to interact with their personal partners. This is unfair to these athletes because they are underrepresented in a smaller country and do not get the recognition that these larger countries and athletes may get. I can see the International Olympic Committee bring Rule 40 more into their jurisdiction so that way they can govern over it more and allow every athlete to get an equal opportunity at making money and promoting their partners.

In conclusion, I think the amendments and adaptations to Rule 40 are beneficial for the Olympics, the IOC, and the athletes. This act shows that the IOC cares about the athletes and wants them to make money wherever possible. I also think this will help with the ambush marketing because it will force these brands to partner with athletes instead of spending money and effort in figuring out different ways for the brand to infiltrate the Olympics without paying for an international partnership. Finally, it is good for the athletes because it allows them to go out and make money as well as competing on a global stage.

Sources:

1. Yi, P., & Borowick, J. (2019, December 5). Rule 40 Changes Create New Olympic Opportunities, Challenges. Lexology. https://www.lexology.com/library/detail.aspx?g=006a3827-cdf3-4d5e-9f92-62f313527c8e.
2. US Olympians able to promote personal sponsors as Rule 40 is relaxed. SportsPro. (n.d.). https://www.sportspromedia.com/news/team-usa-usopc-olympics-rule-40-athletes-sponsorship-tokyo-2020-ioc.
3. LawInSport. (n.d.). Navigating Olympic advertising: Rule 40 — a global perspective. LawInSport. https://www.lawinsport.com/topics/features/item/navigating-olympic-advertising-rule-40-a-global-perspective#:~:text=%E2%80%9CRule%2040%E2%80%9D%20is%20the%20somewhat,the%20permission%20of%20the%20IOC.
4. Thomson Reuters. (2019, February 27). Olympics: German athletes score advertising win over IOC for Games. Reuters. https://www.reuters.com/article/us-olympics-germany-idUSKCN1QG16V.
5. Athlete365. (2020, February). Commercial Opportunities for Athletes. Olympic Games Tokyo 2020. https://d2g8uwgn11fzhj.cloudfront.net/wp-content/uploads/2020/03/06100605/Athlete365_Commercial_Opportunities.pdf.
6. Jones, J. L. (n.d.). International Olympic Committee Rule 40: Reasonable Protection for the IOC or Unfair Restriction to the Athletes? DigitalCommons@Kennesaw State University. https://digitalcommons.kennesaw.edu/amj/vol8/iss1/7/.