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Contracts are the foundation for any agreement between two or more parties. They are used so that agreements are legally binding and so either party can apply for compensation through the court if the other party does not uphold their obligations under the contract. For example, obligations could be to provide a product or pay money. A popular type of contract is a broadcast agreement. This article will explain what a broadcast agreement is and the key clauses a broadcast agreement should include.

What Is a Broadcast Agreement?

A broadcast agreement can cover several different types of transactions. They are generally used as a licence for another party to use your intellectual property. Intellectual property includes:

  • branding;
  • logos;
  • technology; and
  • intangible assets.

You can also use broadcast agreements to refer to agreements between organisations and media broadcasts. For example, a sports league will have an agreement with a broadcast such as Sky that gives Sky the right to televise that league. These agreements are usually binding for several years and dictate how the content is shown and in what capacity they can use the footage. 

Key Clauses

Content Clause

One of the key clauses in a broadcast agreement is the content clause. A content clause details what content a broadcaster can distribute. Alternatively, it will outline what intellectual property can be used by whoever is being licenced. Your content clause must be accurate as it needs to contain exactly what content the broadcaster can broadcast. It should also contain who and at what times the media can be broadcast.  

You should carefully review what your content clause says. If you broadcast something that is not allowed to be broadcast, you could breach the contract. This means that your contracting party may be able to sue you in court if they have suffered some sort of loss because of the breach.

Termination Clause

Another important clause that you should include in your broadcast agreement is a termination clause. This allows either party to cancel the contract once certain conditions have been met. Usually, one of these conditions will be if the other party breaches the contract. This means that they do not uphold their obligations under the contract. A termination clause is essential as you do not want to be tied to a contract that is not benefiting you. It is important to remember that you can still claim damages in court even if you have terminated the agreement. However, a judge will usually only grant you damages if you have suffered some sort of loss that stems from the breach.

Another condition you could add to your termination clause is if an external factor has caused the contract to be unsuitable. For example, if the sports game that you were broadcasting is cancelled, you would be able to terminate the agreement for that game.

Liquidated Damages Clause

Some contacts may include a liquidated damages clause. A liquidated damages clause is a predetermined amount that is set at the formation of the contract. This amount is then paid by the party that breaches the contract. This is a standard clause in a contract where a breach of contract is expected. The purpose of the clause is to make both parties aware of the consequences of breaching the contract at its formation. 

However, the courts may not enforce liquidated damages clauses if the amount agreed is not a genuine estimate of the loss incurred. Instead, they may enforce their penalty, which could be higher or lower than the liquidated damages that were agreed upon.

Assignment of the Agreement

It is also prudent to include an assignment clause in your broadcast agreement. An assignment is a method of transferring a contract to another party. As a broadcaster, you may want to utilise an assignment if you cannot uphold the contract. This could be because you do not have the right equipment, or your business is not suited to the broadcast at hand. In this case, you may be able to assign the contract. Although you do not need an assignment clause or the permission of your contracting party to assign a contract, it is prudent to include one in your contract to avoid any disputes down the road.

Key Takeaways

A broadcast agreement will govern the relationship between a broadcaster and a media creator. As with any contract, there are specific clauses that you should include in your broadcast agreement to make the agreement beneficial for both parties. Proper clauses will also lower the chance of a dispute between the parties. Common causes include:

  • a content clause;
  • a termination clause;
  • a liquidated damages clause; and
  • an assignment clause.

If you need any legal assistance with broadcast agreements, LegalVision’s experienced contract lawyers can help. Call us today on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

Can a broadcast agreement be varied?

Yes, any contract can be varied as long as all the parties agree to the variation.

Can I assign a whole contract to another party?

No, you can only assign the rights, not the obligations under the contract. This means you can only assign benefits you receive under the contract.

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