Sponsorship contract in France: definition, operation and essential clauses

The sponsorship contract has become a strategic tool for SMEs that want to develop their visibility, retain their customers or support meaningful projects. Well structured, it combines commercial opportunities, legal security and fiscal optimization.

What is a sponsorship contract?

A sponsorship contract is an agreement by which a company (the godfather) provides material or financial support to a person, organization, organization, event or project, in exchange for visibility or commercial benefits. It is different from a simple donation because the advertising or commercial compensation is at the heart of the operation.

In practice, this contract can take various forms: sponsorship of a local sporting event, support for a cultural association, customer sponsorship program between your own customers, agricultural sponsorship, etc. For an SME, the key is to precisely formalize everyone's commitments in order to avoid any subsequent disputes.

What is the principle of sponsorship?

The principle of sponsorship is based on a balanced exchange: the company provides resources, the beneficiary offers visibility or a contribution to the brand image. Legally, it is a provision of services that falls under common contract law and commercial law.

Concretely:

• The sponsor provides funding, equipment, products, or expertise.
• The sponsored person undertakes to promote the company: logo display, mentions in communications, publications on networks, invitations, image rights, etc.

Concrete example : a construction SME finances €5,000 for the renovation of changing rooms for an amateur football club. In return, the club places the SME logo on the jerseys, quotes the company in its publications and offers a communication space during weekend events.

The four main types of sponsorship

There is no single legal classification, but practice makes it possible to identify several main types of sponsorship adapted to SMEs.

Sponsorship of events

You support a one-off or recurring event (trade show, sports event, festival, conference, webinar, etc.). In return, your company benefits from visibility on all event communication media.

example : sponsorship of the “entrepreneurship forum” of a local authority with the presence of the logo on the posters, dedicated stand and speaking during the round table.

Sponsoring someone (personality, influencer, athlete)

The sponsor finances a natural person (athlete, artist, artist, influencer, expert) in exchange for using their image for promotional purposes. This type of sponsorship is very similar to individual sponsorship, especially in the sports field.

example : a ready-to-wear SME dresses an Instagram content creator who is committed to wearing outfits at events and tagging the brand in his posts.

Structure sponsorship (association, club, organization)

The company supports a structure (charitable association, sports club, sports club, school, cultural organization) to benefit from sustainable visibility. This form is common for locally based SMEs who want to strengthen their territorial reputation.

example : sponsorship of an association for integration through economic activity, with mention of the sponsor on the site and campaign materials, plus the right to use the association's logo in your own communications.

Customer sponsorship (commercial referral program)

You set up an internal referral program through which your existing customers recommend new customers, in exchange for benefits (vouchers, discounts, gifts). This type of sponsorship contract falls directly under commercial law and consumer protection.

example : customer sponsorship contract in which a customer who recommends a loved one is awarded a 10% discount voucher, while the referred person receives a welcome discount.

Sponsorship, sponsorship and sponsorship: making a difference

What is sponsorship for a business?

For a company, sponsorship is a commercial communication tool aimed at promoting the image, products or services to a targeted audience. In accounting terms, it is translated as an advertising or promotion burden, because it pays for a visibility service provided by the sponsored person.

The main objectives are:

• Gain notoriety in a territory or sector.
• Creating sympathy and vicinity with an audience (support from a local club, a cause, an event).
• Generate leads and sales, in particular through customer referral programs.

Sponsorship and sponsorship

In practice, sponsorship and sponsorship are often used synonymously, especially in sports. Both are based on the same logic: a significant advertising reward in exchange for financial or material support.

Qualification is especially important:

• In terms of taxation (deductible charge if the counterparty is justified, proportionate and documented).
• On the contractual level (advertising, image, performance obligations to be precisely supervised).

Sponsorship and sponsorship

Sponsorship is based on material or financial support without equivalent commercial compensation, for a disinterested purpose (culture, solidarity, heritage, research). In return, the sponsoring company can benefit from a tax reduction under certain conditions, provided that the rewards remain symbolic and much lower than the amount of the donation.

When the counterparties take on real importance and have a promotional purpose, the operation switches from sponsorship to sponsorship/sponsorship, with different tax treatment. For an SME, the risk is to abusively claim the advantageous tax regime of sponsorship while the tax authorities reclassify the operation as sponsorship.

Commercial sponsorship: legal framework and applicable legislation

Common contract law

The sponsorship contract is subject to the provisions of the Civil Code relating to common contract law (formation, validity, execution, liability). As such, you should ensure that:

• The clear determination of the purpose and the reciprocal benefits.
• The legality of the object (no sponsorship of illegal activity or activity contrary to public order).
• The balance of commitments to avoid unfair terms, especially if one party is a consumer or a small association.

Consumer law and commercial practices

Customer referral programs must comply with rules relating to fair commercial practices and consumer information. For example, it is appropriate to:

• Clearly inform about the conditions for obtaining sponsorship benefits (ceilings, deadlines, exclusions).
• Avoid misleading or aggressive advertising.
• Respect the regulations on games and competitions if the device is similar to a lottery or a promotional game.

Personal data (RGPD)

A sponsorship contract involving the transmission of contact details of customers or prospects (customer sponsorship, sponsorship via online forms, etc.) must comply with the RGPD:

• Legal basis for processing (legitimate interest or consent).
• Information for individuals about the use of their data and their rights.
• Limitation of uses to the announced purpose.

Intellectual property law and image rights

The use of a person's logo, name, brands or image (athlete, influencer, artist) requires clear contractual authorization. The sponsorship contract must include:

• The scope of the license (media, territories, duration, types of media).
• Limits of use (prohibition to deform the logo, to associate the image with sensitive messages, etc.).

How to write a sponsorship contract for an SME?

The essential clauses

Even for an SME, a sponsorship contract must include a base of unavoidable clauses.

• Identification of the parties : company name, form, seat, representatives, RCS number.
• Purpose of the contract : precise description of the sponsorship operation and the visibility objectives.
• Duration : start and end dates, conditions for possible renewal.
• Obligations of the sponsor : amount of support, nature of contributions (financial, material, skills), payment schedule.
• Obligations of the sponsored person : visibility commitments, supports, frequency, deliverables (logo presence, mentions, posts, invitations, etc.).
• Possible exclusivity : sector of activity or territory reserved for the sponsor.
• Intellectual property : rights of use of brands, logos, content, images.
• Responsibility and insurance : risk distribution, event insurance, compensation clauses.
• Early termination : serious breaches, damage to the image, force majeure, bankruptcy, etc.
• Applicable law and competent jurisdiction : very often French law and the courts of the seat of the sponsor or sponsored person.

Example of a clause (simplified excerpt)

To be adapted and legally secured, in particular according to the sectoral context:

“The Sponsor undertakes to pay the Sponsored Party a financial contribution of a total amount of [X] euros excluding VAT, payable according to the following schedule: [details of payments]. In return, the Sponsored Party undertakes to promote the image and products of the Sponsor by the following means:
— placing the Sponsor's logo on [specify supports];
— mention of the Sponsor as “Official Sponsor” in all communication materials relating to [the event/event/program];
— publication of at least [X] messages on the Sponsored's social networks mentioning the Sponsor, according to a schedule agreed between the Parties.”

Model sponsorship contract: advantages and limitations

Many sponsorship contract models are available online, sometimes offered by federations, associations or legal platforms. They can be an interesting work base for structuring your ideas and identifying the essential sections.

However, a standard model cannot take into account:

• From your sector (agricultural, associative, local authorities, digital, etc.).
• The tax specificities of your situation.
• Your image, compliance, or governance constraints.

The risk is to use a poorly adapted, incomplete, or unbalanced contract, which will not effectively protect you in the event of a dispute.

Focus: agricultural sponsorship contract

Agricultural sponsorship takes various forms: animal sponsorship, plot sponsorship, support for farms in short supply chains, partnerships with cooperatives. It often has a double logic: support for local agriculture and promotion of the responsible image of the company.

The points of vigilance are specific:

• Quality and compliance of the products delivered to the sponsor (health and regulatory standards).
• Management of production hazards (bad weather, diseases, volatility of yields).
• Volume, price and delivery schedule clauses.

example : a catering SME sponsors a local vegetable grower who is committed to providing a portion of production in a short circuit; in return, the SME communicates about this “farm to fork” partnership in its marketing strategy.

Focus: association sponsorship contract

Association sponsorship is one of the most frequent arrangements for SMEs, especially in the sports, cultural, social or educational fields. It makes it possible to combine local impact, societal commitment and controlled visibility.

Key points to include in the contract:

• Status of the association and social purpose.
• Nature of support (financial, material, skills, skills sponsorship, etc.).
• Nature of visibility rewards (logo, mentions, invitations, access to events, co-branding).
• Clear distinction between the part under sponsorship (donation with symbolic rewards) and that under sponsorship (significant advertising rewards).

Focus: sponsorship and local authorities

Local authorities can also conclude sponsorship contracts (or sponsoring) contracts in the context of events or equipment for which they are responsible. For an SME, positioning itself as a sponsor of an event organized or supported by a local authority can strongly strengthen local roots.

Points of attention:

• Respect for the rules of public procurement and transparency.
• Specific regulatory framework for advertising in public spaces (urban planning, signage, highway code, etc.)
• Compatibility between the image of the SME and the values carried by the community and the event.

Practical guide: checklist before signing a sponsorship contract

Before concluding a sponsorship contract, an SME has an interest in asking itself a few simple questions:

• Does the operation serve a specific objective (visibility, local commitment, customer loyalty, recruitment, etc.)?
• Are visibility rewards clearly listed, quantified, and dated?
• Is the budget in line with the expected and documentable benefits?
• Have the fiscal aspects (sponsorship vs sponsorship) been arbitrated with your advice?
• Does the device comply with the GDPR, image rights and advertising rules?

FAQ — sponsorship contract

What is a sponsorship contract?

A sponsorship contract is an agreement by which a company materially or financially supports a project, person, event or organization, in exchange for commercial visibility or image benefits. It is a synallagmatic contract for the provision of services, subject to common contract law, which must precisely describe the commitments of each party.

What is the principle of sponsorship?

The principle of sponsorship is exchange: the company pays funds or provides resources, the sponsored person provides a communication service (advertising, promotion, brand promotion). The balance of this exchange and its accounting and contractual traceability are essential to secure the transaction, especially in terms of taxation.

What are the four types of sponsorship?

In practice, the main distinction is made between:

• Sponsorship of events (sporting, cultural, professional manifesto).
• Sponsorship of people (athletes, artists, influencers).
• The sponsorship of structures (associations, clubs, organizations).
• Customer sponsorship (commercial sponsorship programs between customers).

These categories can be combined in the same contract depending on the strategy of your SME.

What is sponsorship for a business?

For a company, sponsorship is a marketing investment intended to increase reputation, brand image or sales, through an association of image with a project, cause or event. It is recorded as an advertising or promotional expense when the compensation is real, documented and proportionate.

Model sponsorship contract: can a standard template be used?

A sponsorship contract template can be a useful starting point for identifying essential categories (purpose, duration, obligations, termination, etc.). However, it must be adapted to your sector, to your image challenges, to your compliance constraints and to the exact nature of the operation (sponsorship, sponsorship, sponsorship).

What is an agricultural sponsorship contract?

The agricultural sponsorship contract organizes the support of a company or individuals to a farm, a plot, a farm or an agricultural project, in exchange for products, visibility or communication. It must integrate the specificities of the sector (production hazards, health standards, logistics, seasonality) and precisely frame volume, quality and calendar obligations.

What is an association sponsorship contract?

It is a contract by which a company supports an association (sports, cultural, social, educational, etc.) in exchange for visibility or communication rewards. The contract must specify the portion that may be eligible for sponsorship (donations with symbolic rewards) and the portion under sponsorship (significant advertising rewards).

What is the legislation on commercial sponsorship?

Commercial sponsorship is governed by common contract law, consumer law, rules relating to commercial practices and, where applicable, the RGPD, image rights and intellectual property. From a fiscal point of view, it is treated as an advertising or promotional operation, separate from sponsorship, provided that the consideration is real and proportionate.

Sponsorship and sponsorship: how to distinguish them?

Patronage is characterized by disinterest, with limited and mainly honorary rewards, which entitles the sponsor company to a favourable tax regime. On the contrary, sponsorship involves substantial advertising rewards, oriented towards a commercial objective, and results in a deductible advertising burden, without any specific tax reduction.

What is the sponsorship of local authorities?

It refers to contracts through which a company supports an action or an event carried out or co-organized by a local authority (municipality, department, region) in exchange for visibility associated with the public initiative. This type of sponsorship is governed by the principles of transparency, the neutrality of public entities and by the rules specific to public procurement and advertising in public spaces.

A supervised and regulated subject: the interest of being supported

The sponsorship contract is located at the crossroads of commercial law, tax law, consumer law, consumer law, GDPR, image law and sometimes public law when local authorities intervene. Each sponsorship operation must be secured on a case-by-case basis, depending on the sector, the parties, the amounts involved and the objectives sought.

It is strongly recommended that you be accompanied by a solicitor for:

• Qualify the operation correctly (sponsorship/sponsorship/sponsorship) and draw the fiscal and legal consequences.
• Draft or review the sponsorship contract (or its amendments) to anticipate risks, protect your image and secure your commitments.

To go further

You can explore these questions in more detail, especially in terms of sports sponsorship and sponsorship contracts, by consulting:

Article written by Guillaume Leclerc, lawyer in commercial contracts and commercial litigation in Paris.

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