The Council of Ministers approves the legislative draft to fight ambush marketing practices

On 17 January 2020 the Council of Ministers approved a legislative draft setting out the «regulation of the prohibition of parasitic advertising (ambush marketing)», thus introducing a general and organic discipline of such a phenomenon, no longer related to single events. In fact, in the past, the issue of ambush marketing had been addressed limited to specific sporting events and exhibitions: for instance, Article 3.2 of Law No. 167/2005, introduced in view of the Turin 2006 Olympic Winter Games, prohibited the undertaking of economic activities in parallel to those carried out by the companies authorised by the event organisor subjects. Moreover, there were other attempts to introduce a general regulation of ambush marketing: the first with the legislative draft no. 1620/2008 “Lolli” and the second with the legislative draft no. 1635/2014 “Idem”. However, the two legislative drafts did not complete their legislative process before the end of the legislature in the course of which they were issued.

The legislative draft recently approved by the Government sets out a general prohibition of parasitic advertising practices, carried out by unauthorised companies during national or international sporting events or fairs and entertainment events involving nationally or internationally renowned artists, where these practices are aimed at achieving an economic and competitive advantage (art. 1.1). The Legislator thus outlined the prohibition’s scope, identifying four mandatory categories of prohibited conducts:

1. creation of an indirect link between a trademark or other distinctive sign and one of the events referred to in art. 1.1 (so called coat-tail ambush);

2. the mention in its advertising of being an official sponsor of one of the events referred to in art. 1.1, without actually being an official sponsor (so called predatory ambush);

3. the promotion of its trademark or other distinctive sign through any action capable of attracting the public’s attention, not authorised by the organiser and carried out at one of the events referred to in art. 1.1 or in places adjacent to those where the event is held (so called distractive ambushing);

4. the sale or marketing of products and services marked – even partially – with the logo of one of the events referred to in art. 1.1 or with other distinctive signs capable of creating a misleading impression of an indirect connection with the event or with its organiser (so called associative ambush).

The legislator clarifies that the conducts carried out in the performance of sponsorship contracts concluded with individual athletes, artists or participants to the aforementioned events, do not constitute parasitic advertising.

As regards to the prohibition’s temporal scope, Article 2 of the draft states that the latter will operate from the ninetieth day prior to the official starting day of the event until the ninetieth day after the official end date.

In case of infringement of the provisions set out in Article 1, the legislative draft provides for fines ranging from 500.000 EUR to 2.500.000 EUR and provides the Italian Antitrust Authority with the relevant investigative and sanctioning powers. In any case, such provisions apply in conjunction with the other measures provided by the law to protect the damaged parties.

At this stage, the legislative process is likely to end positively in the coming months, given the legislator’s intention to set out a clear regulatory framework with regard to parasitic advertising, before the start of the 2020 European Football Championship.