Sports clubs warned about aligning brands with e-cigarette companies [Legal Monitor Worldwide]
(Legal Monitor Worldwide Via Acquire Media NewsEdge) Sports law and commercial rights specialist James Earl of Pinsent Masons, the law firm behind Out-Law.com, said that sports clubs and the bodies that fund sport in the UK should each form a policy setting out their attitude to the alignment of their brands with e-cigarettes companies, regardless of the legal framework within which e-cigarettes can be sold and marketed.
"The concept of e-cigarettes is currently asking a lot of awkward questions of stakeholders in the sports market, from clubs, association bodies, rights holders, event and stadium operators, as well as the Government and law makers," Earl said. "Businesses active in the sector are being challenged on whether to accept the alignment of their brands with those of e-cigarettes companies."
Earl said that there are a number of issues relating to e-cigarettes that remain in question, such as the extent to which the products offer benefits to individual users' health relative to smoking traditional tobacco products.
There are also additional questions that need to be asked about the attractiveness of e-cigarettes to youths. The issue of whether, by using e-cigarettes, that audience is more likely to start using traditional cigarettes or other tobacco products despite the health risks, regardless of whether the e-cigarettes themselves contain nicotine or not, is up for debate, he said.
"There are many unanswered questions on the merits of e-cigarettes and, until such time as many of these are clarified, in particular whether there are any harmful side affects of using these devices, rights holders and fellow sponsors will understandably be wary about creating brand alignments and partnerships with e-cigarette brands," Earl said.
"In traditional sports marketing forums, where the captive audience is often young and sport-focussed people, clubs, associations, funding bodies and the other stakeholders must ask themselves searching moral questions about whether they themselves want to be associated with e-cigarettes and whether existing or potential new commercial partners would welcome them partnering with e-cigarettes labels, due to the knock-on associating with their own brands too," he said.
"Sports bodies would not want existing funding partners to withdraw their support, or for prospective deals to fall away, because they failed to take these considerations into account. Having a clear policy on the issue, based on a weighing up of the pros and cons of e–cigarette sponsorships to them, will help sports bodies negotiate these sensitivities," the expert added.
Earl pointed to the negative publicity that surrounded Newcastle United's deal with payday loans giant Wonga as an example of the brand issues that rights holders could have to contend with, if they decide to partner with controversial brands and products.
"The Wonga deal caused many to ask about the types of restraints that could be extended to advertising, particularly in sport, on products like pay day loans," Earl said. "E-cigarettes is a very similar scenario, and with bans and restrictions on tobacco and alcohol advertising respectively already being in place, precedent exists for other products to be targeted if public opinion supports this."
A number of football clubs in Britain have already entered into commercial partnerships with e-cigarettes brands in recent months. Merthyr Town Football Club in Wales renamed its ground the "Cigg-e Stadium" after it entered into an agreement with Cigg-e for the sale of the naming rights.
In addition, Celtic and Derby County have both signed deals with E-Lites that allows the e-cigarettes company to sell its products within Celtic Park and Pride Park respectively on match days.
Earl said, though, that other clubs have decided to ban e-cigarettes from being smoked within their stadiums, albeit predominantly on security and health and safety grounds. He said that the difficulty in distinguishing between e-cigarettes and traditional cigarettes has resulted in bans being imposed on the products at many major sports and events venues including Wembley Stadium. Smoking cigarettes in a public place is banned under UK law, and security staff have struggled to enforce this ban with the presence of e-cigarettes in venues and particularly large crowds.
Earlier this month the European Parliament voted to tighten rules relating to tobacco products. All "nicotine-containing products", including those in the e-cigarettes format, are to be regulated under the plans. However, e-cigarettes are not to be treated as medicinal products, meaning that whilst nicotine-containing e-cigarettes will face the same advertising restrictions as tobacco products, the threat of an outright ban on their advertising has lifted.
Under the proposed reforms, which still need to win the backing of EU member states, new health warnings would need to be added to tobacco product packaging, flavoured tobacco would be banned and retailers would also be prohibited from selling packets of fewer than 20 cigarettes.
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