Drinks industry fears move to ban sport sponsorship

The pounds 40m that drinks companies pour into British sports sponsorship every year is under threat from a controversial French plan to ban drinks advertising for international sporting events. However, as Andrew Yates reports, new European legislation could bring cheer to the British drinks industry.

A move by the French Government to enforce a ban on sports sponsorship from alcoholic drinks companies could put pressure on them to withdraw advertising from big sporting events.

There are growing fears that the European Commission (EC) has decided to ignore a complaint from the drinks industry over France's decision to ban domestic drinks advertising, a controversial policy known as Loi Evin. The EC has again delayed a final decision on whether to uphold the complaint after furious lobbying from French Eurocrats. "There is a feeling they want to sweep this under the carpet," said one source in Brussels.

The decision could have potentially devastating consequences for the UK sports industry. Drinks companies are involved in sponsoring every major sports including Carling Black Label's support for football's premier league and the new deal Tetley Bitter has recently signed to back the English cricket team. Major sporting events such as the Stella Artois tennis tournament and the Martell Grand National could also be affected. The sponsorship market in the UK is worth an estimated pounds 350m a year. Drinks companies account for about 12 per cent of this, or more than pounds 40m a year. US drinks company Budweiser has also run into trouble coping with the strict ban on drinks advertising and the move has raised a question mark over sponsorship of this years World Cup in France. If the EC chooses to ignore the issue and effectively back France's position, it could cause huge problems for the coverage of some of the UK's largest sporting events. French TV producers are putting enormous pressure on organisers to remove any form of drinks advertising from sporting arenas and are threatening to withdraw coverage from events if their demands are not met. The situation has got so bad that two big recent sporting events were banned completely. French viewers were faced with a blank screen when they tried to tune into a European football tie between Arsenal and Auxerre and an Irish rugby game from Dublin.

The sports industry is becoming increasingly worried that drinks companies could withdraw from sponsorship if French TV stations persist in banning events.

The move has caused an outcry from the British drinks companies. The European Sponsorship Consultants' Association (ESCA), an industry-wide body set up to lobby against the French policy, is outraged by the continuing wrangles in Brussels.

"We want this to be stopped and are trying to alert people to the danger. There is a fear that this could spread to other countries in Europe and make life very difficult for sponsors," said Helen Day, a sponsorship expert with the ESCA.

However, a green paper, which experts believe will be adopted by the EC later this year, is likely to bring hope to the drinks companies. It promotes the principle of free trade between countries and should give the drinks companies a powerful weapon in their battle with the French Government. They hope the paper will give them right to show drinks sponsored sports events throughout Europe.