France's sports code makes it possible for players’ image rights licensing alongside employment contracts

A Law dated 1 March 2017[1] has introduced a new article into the French sports code[2] that provides sports clubs and players the possibility to enter into a separate image rights agreement alongside the main employment contract. Provided that certain conditions are met, the remuneration paid under a separate image rights agreement will not be classified as a salary and thus will not be subject to the social tax paid by the employer and employee under an employment agreement.

This article explains what the new law says and identifies a number of issues that will require further clarification and careful attention by the parties when drafting such agreements.  Specifically, it looks at:

• The background to the new law and why it was necessary
  
  
• What the new provision introduced into the French sports code says
  
  
• Points that may need clarification to avoid any reclassification as a salary
  
  
  • What if clubs and players manage their image rights through separate companies?
    
    
  • What image rights may be governed by a separate licensing agreement?
    
    
  • How will the royalties be calculated?
    
    
  • How will the royalties be paid?