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Image protection vital in securing long-term income.

Professional sports people can earn as much money from the use of their image as they can from playing their sport.

Indeed for those at the top of their sport, product endorsement may be a critical part of their long-term income, for some well beyond their playing career, like Gary Lineker.

Misuse of their image by unlicenced traders can also deny them their proper income and damage their image. Sponsors will not be prepared to pay for product endorsement it they see unlicenced use.

Today sport is global, best evidenced in the TV audiences for the Bejing Olympics and the English football Premier League.

Global brands want to be endorsed by global sports stars and licensing therefore goes well beyond the United Kingdom.

We therefore recommend that sports people protect their images by granting the primary licence in a suitable jurisdiction that will enable them to establish legal protection and minimise world wide taxation.

BTG Tax often uses its Cyprus office to co-ordinate the worldwide licensing where there is low local taxation, combined with the benefit of more than 50 double tax treaties.

Cypriot companies can write their commercial contracts under English Law and have them determined by the UK Courts.

From a business perspective this can be very useful.

In the early 1990s I was instrumental in organising image rights licences for football players both in the UK and abroad.

At that time little was understood about the value of such contracts but over the years all parties have begun to appreciate the value of such intangibles.

It not only covers a photographic image but also the use of a signature, nickname or even the shirt number, such as Ronaldo No 7 or Owen No 10.

Recent court cases over alleged faked memorabilia have highlighted this issue.

Protecting the image rights can also be expensive and therefore we need to find tax-efficient structures so that tax is paid in as few countries as possible.

Structures also need to be flexible to reflect the fact that the sports person will play their sport in many different countries and may change their tax residency several times during their career.

At BTG Tax, we take a holistic and commercial view to managing a sportsperson's image rights so as to maximise the net return over time to the sport personality.

We also ensure with legal assistance that the structure is robust and can successfully counter misuse by unauthorised third parties.

BTG Tax has created a number of special structures for the use of international sports personalities whether they are coming to the UK or leaving to play abroad. For more information call the author, Andrew Shaw, national tax managing partner, BTG Tax, on 0121 452 1515.

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Michael Owen
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Title Annotation:Business
Publication:The Birmingham Post (England)
Date:Aug 19, 2008
Words:457
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