LIDC Congress 2007

Nordic Group / Finland

Petri Eskola

Attorney-at-law

Backström& Co

Helsinki, Finland

Question B:

Ambush marketing: too smart to be good?

Has your country enacted legislation specifically aimed at prohibiting ambush- marketing? Or are there concrete plans to enact such legislation?

There is no such legislation adopted in Finland which is specifically aimed at prohibiting the so called ambush marketing. For the time being there are neither any existing plans to amend the prevailing legislative situation in this regard. Generally ambush marketing is rather rarely applied means of marketing on the national level and has not caused any particular discussion.

Legally the situations which could be called as ambush marketing are primarily to be dealt with by applying provisions of the Act on Unfair Trading Practices (UTPA).

What are the interests protected by the anti ambush-marketing provisions adopted in your country?

In the absence of specific ambush-marketing provisions in your country or in addition to such specific anti ambush-marketing provisions, are there other legal grounds on which such practices can be prohibited? Are there, for instance, special property rights for sport events or are the current unfair competition law or trademark principles or other principles based on civil law or else, applicable to ambush marketing?

Since there are no specific ambush-marketing provisions in Finland, the primary legal basis to restrict of prohibit ambush marketing is based on the Act on Unfair Trading Practices (UTPA).

There are no specific property rights as such granted for sport events in Finland. As a point of departure it can be noted that basically whoever may arrange sporting or other type of events irrespective whether there are other similar type or competitions existing already. However, factually this freedom is much more restricted due to the fact that many organizations do have a kind of a factual dominant position to arrange certain competition or events. For instance, most of sports are organized under national (and international) federations who only can arrange official championship competitions.

The main legal right, a property right of a kind, which relates to sport or some other events, is obviously trademark right protecting name or logo or some other symbols of an event.

Even if there would be no question whether an ambush marketer as such infringes other’s trademark, in some cases, depending on the actual ambush-marketing method in place, the Trademarks Act could still apply as a tool to restrict or prohibit such activity. For instance, Section 6 of the Act provides protection for well known trademarks against unauthorised use which could be detrimental to the repute or are taking advantage of such repute of a well known mark of others without due cause and acceptance.

Also, in some respects copyright might serve as a legal means to prohibit or restrict ambush marketing.

Furthermore, in absence of specific legislation aimed to restrict / laying down rules for ambush marketing, there could be some contractual arrangements or some self-regulatory means to affect such marketing.

On a general level it can be noticed that organizers and sponsors of different kind of events are free to agree on terms of the sponsorship, in which eventual disturbance of the sponsor’s position and efforts could be taken into account. Naturally, this would have only inter parties effects and could not as such, directly affect an eventual ambush marketer. This kind of arrangement would rather serve as a tool to restrict organizers liabilities.

The organizers may also provide rules how the audience or the attendees to an event should behave and what kind of goods they may bring with them in the events. For instance, it is typical that in tickets there might be “rules”, or rather instructions, for the attendees on what kind of devices or goods in general are allowed to be brought with to the event area. These are, however, normally rules based on safety reasons, but could eventually even contain rules which could restrict ambush type of marketing.

Can you describe all the provisions that could be applicable to ambush-marketing situations? Is there a criterion or test common to all these different provisions?

Section 1 of the Act on Unfair Trading Practices provides a general prohibition against practices which can be deemed to be against a fair business practice or otherwise unfair towards another trader.

The definition “unfair trading (business) practice” is very broad and can be applied in great variety of situations. Thus this clause could cover many ambush marketing situations, but due to the generality of the clause the marketing in question needs to be qualified, for instance so that it would result in confusion amongst consumers to assume that the trader in question has paid for marketing and has an official sponsor status (if this is the ambush marketing situation in question), and thus benefits unjustifiably at the expense of the competitor who is the official, paid sponsor of the event.

The Market Court shall case by case assess the overall impression, and the relevant consequences, received from such marketing and decide whether it is a question of breach of the general clause of the UTPA.

Section 2 of the UTPA is also a general clause providing prohibition against the use of untrue or misleading statements concerning one’s own or another’s trade or expressions including irrelevant or inappropriate information which can affect demand or supply of goods or be detrimental to the business of others.

This clause also could be used to prohibit ambush-marketing in case the requirements set forth are fulfilled. Even though the information provided in the course of (ambush) marketing would as such be misleading it could be considered not to be against Section 2 of UTPA if there is also such information available which tells the observers the true, correct and accurate circumstances. Again, it would be up to the Market Court’s assessment of overall situation when deciding whether or not the marketing has been against law and whether it can be prohibited.

The UTPA also contains a reference to separate provisions of the Consumer Protection Act regarding the allowed means of comparative advertising.

The provisions of UTPA are primarily applicable in B to B situations. If the marketing in question concerns,affects and is targeted primarily and grossly to consumers, the provisions of the Consumer Protection Act may be applicable instead. In ambush marketing situations however, it is obviously more question about B2B competition and provisions of Consumer Protection Act would not become applicable in most of the cases.

Similarly with the above described provisions of the UTPA, the Consumer Protection Act contains general clauses prohibiting marketing practices which are against good and acceptable practices or which otherwise are inappropriate to consumers. Furthermore, it is specifically prohibited to use untrue or misleading statements or information.

The Consumer Protection Act also contains rather detailed rules regarding comparative advertising. The framework for comparative advertising is based on EU Directive. These provisions are applied also in the situations otherwise belonging into the scope of Unfair Trading Practices Act, which has a reference to the Consumer Protection Act in this regard.

Using symbols which are liable to create confusion with another’s already protected trademark is a basic situation covered by the Trademarks Act. The protection of prior right may be based on registration or establishment of the sign through use.

In addition to the basic situations falling within the scope of trademark protection, the Trademarks Act also offers more extensive protection to well-known trademarks, as mentioned above.

Apart from their own individual criteria of application, the above referred legal provisions have one common criteria in one situation. Under both UTPA and Trademarks Act a court may consider whether a sign has became known among a relevant target group or/and whether a confusion regarding commercial origin of a product or a service is created. The last mentioned might be relevant also in ambush marketing situations.

A sign may also be protecetd under Copyrights Act and ambush marketing reproducing such a sign might also be subject to prohibition under the provisions of the Copyright Act.

What are the available remedies and to whom?

Remedies available under UTPA and the Consumer Protection Act are rather limited. The primary remedy is a prohibition to the infringer. Such prohibition may be accompanied with a threat of a penalty payment/fine.

Under specific circumstances the infringer may also face a liability to compensate damages to the trader who has suffered damages due to the actions taken. This would be based on provisions of the Tort Liability Act, according to which the compensation of pure economical damages is possible only where the infringer has either committed an act which is punishable, i.e. where criminal sanctions apply, or where especially weighty reasons for compensation exist.

In cases where consumers are the subject of marketing activity and thus belonging into the scope of application of the Consumer Protection Act, the Consumer Ombudsman may commence proceedings at the Market Court to apply prohibition against the marketing.

If the marketing has primarily B2B effects, then the competitor directly affected may seek for prohibition from the Market Court. The problem here would be, when an inappropriate ambush marketing situation is at hand, that interim injunctions are rather difficult to receive. On the other hand prohibiting an ambush marketing campaign could require very fast and effective remedy. In this regard there seems to be insufficiencyon remedies available.

Are there sanctions available (administrative or civil) and what are the authorities entrusted with enforcement authority?

As mentioned above the civil sanction is the damage compensation liability, which however, concerns only very limited number of situations.

One administrative/civil type of sanction is the possibility provided by the UTPA, that the infringer is obliged to make appropriate corrective measures due to the infringing activity and further to publish the Market Court’s prohibition at a widely spread newspaper or in a periodical magazine.

Examples (4.1 – 4.10)

There are only very few court cases where marketing having a character of ambush marketing has been considered. This reflects to the situation that it appears like ambush marketing in its “best” has not been very popular and widely applied so far.

Since the law as referred above only contain very general provisions covering all kind of unfair and inappropriate marketing activities it is rather difficult to give examples of behaviours which would be considered as prohibited ambush marketing in Finland.

There is one currently pending case where the former sponsor of an athlete was sued to the Market Court because the picture and name of an athlete (among other several succeeded athletes) still appeared on marketing brochure of this sponsor. The new sponsor initially reacted by applying injunction as a precautionary measure. This application was accepted by the first instance court but the court of appeals cancelled the injunction. It appears like in this case the athlete was more or less by mistake on the said brochure and assuming it was so this is not a case of ambush marketing.

In the light of almost inexistent court praxis the following presumptive answers can be given to the following questions:

This could be considered as ambush marketing only under specific circumstances and most likely it should be a competitor of the official sponsor in question.

Only under very specific circumstances.

Most likely not under the prevailing legal framework, but again depends on specific circumstances.

Could be, but rather and primarily this could constitute a trademark infringement. Such a case can be trialled separately and simultaneously in two instances based on these two different laws, the UTPA and the Trademarks Act.

Under UTPA a disclaimer could eventually serve as a tool to prevent qualification as prohibited marketing.

This happens often and it has not been considered, so far, as prohibited.

Yes, there are no obstacles for the official sponsor to reward such an athlete.

No, there is basic freedom (limited by some administrative rules etc) for anyone to arrange such events regardless whether parallel or not.

No, it is allowed to buy TV slots around such broadcasting.

No, such support of another broadcast would not be prohibited.

Fundamental questions

In absence of specific anti ambush marketing provisions in Finland, it appears like the general rules of unfair competition law have been sufficient. Partly this might be because there haven’t been many major scale international athlete competition events arranged here over the last years, and in those occasions the problem of ambush marketing has not appeared.The flexibility of current unfair competition rules appears to grant protection against such activities. However, a clever ambush attack would easily go beyond the scope of unfair competition rules and in those situations there would not be legal protection for the official sponsor.

Most likely enforcement of sponsor position under the prevailing legal framework would by no means raise severe consideration whether this kind of enforcement would constitute abuse of a dominant position.

Unfair competition rules can be seen in some respects as a kind of “expansion” of the actual intellectual property rights to areas where similar kind of issues are appearing (especially those relating to trademark or copyright protection), but where the actual intellectual property rules do not reach. However, by no means can these rules be seen, as practiced by the relevant courts, as creating exclusive rights whatsoever.

In those occasions when major international events have been organized, it has commonly been recognised that the town, or even larger areas of the country, where the events been arranged, are gaining economical advantage of this. Hotels, restaurants, shops etc., are getting more turnover and profits due to the great number of attendees, tourists, journalists, spectatorsand fanscoming to follow the event.

So far it hasnot been publicly expressed or questioned, that it would be a problem that organizer may appoint sponsors with big investment to reserve sole right of taking direct advantage of the event by marketing. In many respects, on the contrary, some doubts have been raised, whether such sponsor role is worth of the efforts and investment put in it.

It could be imagined that a sponsor would like to maximize its visibility, which, in turn requires that it has exclusivity or at least that there are not too many other sponsors at the place.

Probably there are no efficient non-legal answers to this question. At least those now existing self regulatory bodies and the own rules of marketing branch do not appear to be very efficient.