Athletes' image rights in sports

The remuneration of professional sportspeople has been significantly increasing over the last decades. This rise in labour costs caused sportsclubs as employers to look out for new sources of income. As a consequence, the exploitation of image rights became a major topic in the professional sports business.

One of the leaders in this trend is football. Accordingly the contractual provisions for the transfer of players' image rights to their clubs and the related compensation regulations got highly prioritised for instance in the model employment agreement for professional football players in Germany. Football clubs are tending to receive as comprehensive exploitation rights as possible.

Situation in France

French law gives sports clubs and its athletes the opportunity to exclude the exploitation of the athletes' image rights from the employment agreement and to enter into a separated image rights licensing agreement.

By this means, and subject to certain conditions, royalty payments to athletes are exempted from social security contributions. Starting point was some years ago the idea that lower payroll deductions should help to attract more players for French sports clubs. If a licensing agreement meets some mandatory conditions as

• the physical presence of the athlete is not required for the exploitation of the licensed rights,
• the royalties are not based on the athlete's salary under the employment agreement,
• the licensed rights are defined by duration, purpose, context, means of exploitation and territory,
• the royalties are calculated as a function of the income that is derived from the commercial use of the licensed rights,
• the royalties are capped at a pre-defined level,

then the royalties paid on associated image rights don't trigger any social security contributions neither for the athlete nor for the club. Even if exempted from social security payments, these royalty payments from the club or associated parties frequently fall within the scope of the internal salary cap regulations of the sports federations.

Royalty payments from unrelated marketing companies for the commercialisation of the athletes' individual image rights are free from social security deductions and fall outside the scope of any regulations of the sports federations in France. In UK these marketing companies often are owned by the athletes themselves.