A guide to the main provisions of endorsement contracts in sport

From athlete endorsements to brand partnerships, sponsorship contracts in sports are complex legal instruments. This article examines the essential clauses of endorsement contracts between companies (brands) and individual athletes, providing key insights for athletes and their representatives during contract negotiations.

Introduction

Concluding sponsorship contracts is one of the most common ways for athletes to exploit their name and likeness and often provide a crucial additional source of income. Athletes commonly generate significant revenue through the conclusion of sponsorship contracts which income significantly enhances athletes' financial gains, allowing them to diversify their earnings beyond sports (employment) contracts or prize money and thereby optimize their overall earning potential.

Simultaneously, companies can strengthen their reach and connect with a wider audience and strengthen or build-up their image through sponsorship of (sporting) events, teams, federations or individual athletes, which makes sponsorship contracts a much-used phenomenon in and a vital component of the present-day sports industry. To place it in perspective, in 2022, the sport sponsorship market was worth an estimated 66 billion U.S. dollars.^[1]

Table of Contents

• Sport sponsorship contracts
• Image rights clause
• Image rights companies
• Morality clauses
• Right to terminate
• Competitors
• Remuneration
• Rights of reduction
• Bonus clauses
• Unilateral extension option
• Right to match and right of first refusal
• Governing law and jurisdiction clause
• Conclusion & Key Takeaways