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Commercial Participator and Sponsorship Agreements

As part of its fundraising efforts, a charity may from time to time arrange for a commercial business to either run a promotional venture as a “Commercial Participator” or provide financial sponsorship for an event run by the charity in return for publicity or other sponsorship benefits for the business.

Commercial Participator Agreements

We have provided four forms of Commercial Participator Agreement which comply with charity law requirements for arrangements with Commercial Participators.

A business will, under charity law, be a “Commercial Participator” where it arranges with a charity to promote and advertise its own products or services and donate a share of its profits to the charity. For example, a stationery retailer might advertise its Christmas cards for sale using the charity’s name and logo, stating that a percentage of profits on sales will be donated to the charity. The potential benefits for a charity are: increased public awareness of the charity’s purposes; free marketing for the charity; and media attention raising the profile of the charity which in turn assists in fundraising.

Arrangements between a commercial business and a charity are regulated by charity law when the business is a “Commercial Participator” under charity law. The Commercial Participator and the charity must enter into a written agreement not only setting out the deal between them but also covering some other matters specified by the legislation.

We have created four forms of Agreement. The description accompanying each of them indicates the general type of arrangement for which it is designed. The form to be used depends on whether or not the promotion involves sale of a product and whether or not a trading subsidiary of the charity is also to sign the Agreement. Examples of relevant promotions are also included in the Schedule to each form indicating some types of promotion for which it is likely to be suitable. Arrangements for other types of promotion might also amount to an arrangement with a “Commercial Participator”, and so where there is any doubt about this, legal advice should be taken.

Charity Event Commercial Sponsorship

A business may sometimes pay sponsorship fees to support charities in connection with events arranged and run by the charity, in return for publicity for the business.

It is strongly recommended that any charity carefully documents such arrangements to protect its assets and reputation. We have therefore provided a form of Charity Event Commercial Sponsorship Agreement written in favour of the charity (to be used by a small or large charity) to cover such financial sponsorship. It provides for a one-off fee paid by a business to sponsor a fairly uncomplicated single charity event. It has provisions protecting the charity, including protection of its name, and limitation of liability in relation to the sponsorship services it is to supply to the business. It also includes protections for the sponsor’s name, logo, trade mark and other rights.

Two further forms of commercial sponsorship agreement, written more in favour of the sponsor, are in the Sponsorship Agreements subfolder in our Business folder.

Commercial Participator and Sponsorship Agreements is part of Corporate Documents. Just £35.00 + VAT provides unlimited downloads from Corporate Documents for 1 year.

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