The Olympic Movement, the Games and Olympic IPR

6/20/2003
Client Alert

The Olympic Games have become the world's most well-known and widely viewed athletic competition. Prepared, organized and staged by numerous international and local non-profit organizations that comprise the Olympic Movement, the organizers of the Olympics throughout the world are committed to promoting Olympic ideals and ensuring that as many people as possible have the opportunity to participate in and benefit from the Olympic competitions. Ensuring this broad participation and availability globally has required significant financial resources, which many years ago exceeded the capacity of most national governments are willing to provide. From an early date, therefore, the Olympic Movement has sought different sources of funding to support the Games, including leveraging the Games' intellectual property rights - the Olympic IPR.

Here we will take an overview of the organizational structure of the Olympic Movement, the allocation of responsibilities for the organization and staging of the Games, and the importance of Olympic IPR in achieving the goals of the Olympic Movement.

The Olympic Movement

The Olympic Movement was launched at the end of the 19th century by Pierre de Coubertin, who is credited with spearheading the establishment of the International Olympic Committee (IOC) on June 23, 1894. De Coubertin, an advocate of French educational reform, considered sports and sportsmanship to be a vital part of education and instrumental in the development of moral integrity. His vision for the modern Olympics materialized two years later with the first Olympic Games of the modern era held in Athens.

Under the Olympic Charter, which provides the basic framework under which the Games are organized, the IOC is designated as the supreme authority for the Olympic Movement. The Olympic Charter also incorporates all subsequent rules and bye-laws adopted by the IOC. In addition to the IOC, the Olympic Movement is composed of many organizations from around the world. Among the most important of these are the International Federations (IFs) of each sport, the National Olympic Committees (NOCs) of each country, and the Organizing Committees of each Olympic Games (OCOGs). It also includes various other national associations, organizations and individuals who support the objectives of the Olympic Movement. Any organization or individual who wishes to officially participate in the Olympic Movement must be recognized by the IOC and then accept and abide by the provisions of the Olympic Charter.

Organizing and Staging the Games

The IOC plays a key role in organizing the Games. It must review and admit sports related to a given Games, make final decisions on the overall schedule and daily timetables for the sporting events and provide historical knowledge to each OCOG. Above all, the IOC monitors a host country's performance of its various obligations through a Coordination Commission which is also responsible for coordinating the relationships among all the members of the Olympic Movement involved in the Games.

Selection of a city to host a specific Games (the Host City) in itself involves a heavily contested competition. Once a Host City is selected, the IOC enters into a Host City Contract with the NOC of the country where the Host City is located, the Host City government, and, after it's establishment, the OCOG for that particular Games. The NOC, Host City government and the OCOG are collectively referred to as the Host. The Host City Contract mandates that the Host must honor all of the commitments made in the bid submission and undertake the performance of numerous obligations for organizing and staging the Games. This Host City Contract, therefore, is the central document governing the relationship between the IOC and the Host for each Games.

The Host City Contract requires the three entities that make up the Host be jointly and severally liable for most commitments concerning the organization and staging of the Games. The key obligations of the Host can be divided into two broad categories: activities directly related to staging the Games, and activities related to developing, using and protecting the Olympic IPR. The first category includes providing competition and training facilities according to the technical requirements of the IFs and IOC, providing accommodation and reception facilities for the members of the Olympic Family, providing transportation, medical and security services for the Games, providing services and facilities to broadcasters and journalists reporting the Games, staging the opening and closing ceremonies and other cultural activities related to the Games, and organizing Paralympic Games after the Games. The second category includes fulfilling the financial projections in the bidding report, conducting marketing programs pursuant to agreements with the IOC, transferring to the IOC the Olympic IPR developed for those particular Games and, to the extent requested by the IOC, documenting knowledge related to hosting the Games after the Games have concluded.

Although the IFs are not parties to the Host City Contract, each of them has obligations under the Olympic Charter to provide technical assistance necessary for the staging of the Games. With respect to the sports selected for inclusion in the Games, the respective IFs are responsible for organizing all sporting events, establishing technical rules and regulations, conducting technical control and supervision of each sport, appointing technical officials and a jury of appeal, and determining the final results and ranking.

Importance of Intellectual Property to the Olympic Movement

Under the Olympic Charter, most elements of the Olympic IPR (including the Olympic symbol, flag, motto and anthem) belong exclusively to the IOC. While the NOCs and OCOGs have limited rights with respect to emblems that they develop and use for a particular Games, after those Games are finished the rights for those emblems must be assigned to the IOC.

Historically, the IOC used the Olympic IPR to supplement the finances of the Olympic Movement. While the early Games were primarily supported by national governments and private donations, even the first Games in 1896 saw an important portion of the budget coming from the issue and sale of twelve commemorative stamps. The revenue generated from the sale of those stamps enabled four of the sports venues to be built.

Taking this tradition of using the Olympic IPR to the next higher level, the Los Angeles Summer Games of 1984 marked the beginning of intensified commercial usage of the Olympic IPR to finance the staging of the Games. Since then, the primary financial source for the organization and staging of the Games have been the proceeds from the marketing program, which depend on effectively commercializing the Olympic IPR.

Association with the Olympics and the values and ideals represented by the Games is of considerable value to many organizations around the world, and they are willing to pay for the right to use the Olympic IPR. To maximize the value of the Olympic IPR that it licenses to these entities (the Olympic Partners), the IOC has devised limited licenses that provide exclusivity in various geographic and industrial categories. Among the IOC's various marketing programs for the Olympic IPR are "The Olympic Partners" (TOP) program, through which companies sponsor the Olympic Movement on a worldwide basis, and various television broadcast arrangements that permit the live and recorded broadcast of the Games. The IOC also permits each NOC and OCOG to adopt national-level marketing programs that license the Olympic IPR, provided that such programs do not conflict with the IOC's international marketing efforts. These programs typically include domestic sponsorship arrangements, licensing, and ticketing for the Games, as well as coin, banknote and philatelic programs based on the Olympic IPR. Proceeds generated from the licensing of the Olympic IPR under these various marketing programs are distributed among the members of the Olympic Movement according to funding guidelines established by the IOC.

A critical part of the licensing arrangements' value is the exclusivity that the Olympic Partners have with respect to using the Olympic IPR on their products. The IOC, both directly and through members of the Olympic Movement, takes active measures to prevent unauthorized use of the Olympic IPR in order to preserve this exclusivity. The first of these measures is implemented during the selection of a Host City, at which time the IOC strongly encourages NOCs to lobby their respective legislatures to enact domestic laws providing specific legislative protection for Olympic IPR. Second, each Host City Contract imposes strict requirements on an OCOG to register and protect, on a global basis, all trademarks for a particular Games. Finally, the NOCs and OCOGs are required to coordinate with the IOC to prevent ambush marketing.

The worldwide success of the Olympic Games has been dependent on the efforts of numerous organizations within the Olympic Movement, each of whom has different responsibilities that are important for the success of each Games. Ensuring that the Olympic Movement is adequately funded so that it can continue to promote the Olympic ideals has been a critical part of the IOC's activities, and has required the development of Olympic Partners who are willing to license the rights to the various Olympic IPR for commercial purposes. While ultimately the Olympic Movement is non-profit, it can be seen that the commercialization of the Olympic IPR is now a critical part of generating funding so that more and more amateur athletes have the chance to participate in the Games.

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