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URC Product Endorsement Policy Working Group
Policy on the Endorsement of Products and Services by UCT; and on
Licensing the use of the Name, Trademarks and other Insignia of UCT
EXPLANATORY MEMORANDUM
I. GENERAL BACKGROUND
The URC Product Endorsement Working Group, having discussed the range of policy
options open to UCT in regard to the endorsement of products and services, agreed that
the UCT brand has enormous value, which could be used to the financial advantage of the
institution through the mechanism of endorsement. However, if that were to be done,
endorsements should be controlled at the highest level, since there is a fine line between
extracting benefit from the UCT brand and diluting its value through inappropriate
exposure or through over-exposure. (In Harvard University’s Guidelines for Responding
to Requests from Third Parties for Endorsements the tension between financial advantage
and reputation is formulated thus: “In business relationships, endorsements can be
mutually beneficial, but endorsements can also lead to misunderstandings and to misuse
of Harvard’s name or reputation.”)
The URC’s interest in the matter is obviously the fact that an endorsement will
often suggest that the University has in one way or another done research to establish the
quality or efficacy of the product or service concerned.
As will be explained in section II below, at a late stage in the consultations in
regard to this policy, it was thought appropriate to deal with the policy regarding
permission to use UCT’s name, trademarks and other insignia in the same document as
that dealing with endorsements.
II. ENDORSEMENTS
1. The different types of endorsement
It should be kept in mind that there are a variety of actions that may be regarded
as product endorsement:
First, there are explicit endorsements. This is where a company would have the
right to say that the University of Cape Town has, for example, tested (or helped to
develop) a particular product or service and commends its quality.
Secondly, there are implied endorsements. An example of this type is if a
company who is a vendor to UCT were to say in its advertising literature that it is a
supplier to UCT: obviously the inference can be drawn that UCT approves of the product
or service. Another example of implied endorsement is where a company states in an
advertisement that “Professor Pat Entor of the Department of Mechanical Engineering
has subjected our product to extensive tests and has found it to be superior to those of our
competitors”. Finally, if a chair in a department or a building is named after a company a
perception might also be created that the University endorses the products or services of
the company concerned.
UCT will have to decide which kinds of endorsements it wishes to control.
Clearly, explicit endorsements fall into the category over which the University would
want to exercise direct control. The same would apply in regard to certain types of
implied endorsement, such as the naming of buildings and chairs. In regard to other types
of implied endorsement the University might want to exercise only indirect control (e g
by setting policy guidelines, while in yet others it might not want to exercise any control
at all. For example, in the case of a an individual member of staff endorsing a product, it
might want to lay down a policy in terms of which any UCT staff member endorsing a
product or service must make it clear that he or she is doing so in a personal capacity.
With regard to an implied endorsement flowing from the mere identification of
the University as a client, UCT would probably not want to exercise any control at all.
(Thus, the University of Michigan defines an “endorsement” as “a statement that includes
comments of an evaluative nature, either positive or negative”, which means that
“statements of fact (example: ‘The computing center uses Mackintosh systems’) are not
considered endorsements”.) In so far as the naming of a chair or a building at UCT
implies endorsement, it should be noted that this policy document does not deal with
permission to name a chair or a building, since there are other mechanisms in place for
these purposes.
2. The question of liability flowing from endorsement
Apart from the fact that the kind of products endorsed by the University could have an
effect on the reputation of UCT, it should be kept in mind that an endorsement could in
certain circumstances also lead to civil liability. An endorsement implying that a product
has certain qualities or has met certain standards could lead to the University having to
pay damages on the basis of a negligent misstatement if the product causes harm to
someone and it turns out that in fact no research or inadequate research was done to
establish the quality of the product concerned.
The exact reach of UCT’s professional indemnity insurance should be known
when a decision is made to allow an endorsement.
3. The financial benefits flowing from endorsements
It is important to note that endorsements should be made only if substantial financial or
social benefit flows from the arrangement to the University. It should be part of the brief
of the entity which controls endorsements to ensure that revenue from an endorsement is
both appropriate and properly distributed. Thus endorsement of a product by the
Department of Mechanical Engineering, for instance, carries weight partly because it is
done specifically by a UCT department. The entity controlling endorsements should
consider whether, in the light of the fact that the general UCT brand contributes to the
generation of the reputation that caused a particular manufacturer to want to ask for
endorsement by the Department of Mechanical Engineering, all of the revenue generated
should go directly to the department. In many instances this will be appropriate, but a
conscious decision must be taken in this regard.
4. The basic approach to endorsements
The specific endorsement policy adopted by the University will obviously be influenced
by the degree to which the University wants to encourage or discourage endorsements.
For instance, if the University wanted to discourage endorsements, permission for
endorsement would be framed as an exception to the rule. Having considered the options
placed before it by the working group, the URC decided to adopt a conservative
approach, which is common amongst the major universities of the world.
II. LICENSING THE USE OF UCT’S NAME, TRADEMARKS AND OTHER
INSIGNIA
Originally the Working Group commented as follows in regard to the regulation of the
use of UCT’s name, trademarks and other insignia:
‘The extent to which the University allows outsiders to make use of its registered marks
and other insignia is a separate, but related matter. The way in which the University
licenses manufacturers to create items bearing UCT’s crest or the name of the University
obviously requires a policy, which must include rules regarding the nature and quality of
the product. This policy must be in harmony with the endorsement policy, but it is a
separate issue. Licensing and endorsement may, however, overlap when the manufacturer
of the endorsed product also wishes to use UCT marks and insignia when advertising the
product.’
Subsequent to the discussions of the URC Product Endorsement Policy Working Group
and the deliberations of the URC itself, the question was raised whether the use of UCT’s
name, crest and other insignia should not also be addressed in this policy document to
avoid the confusion that would inevitably arise if different committees were to oversee
endorsement and licencing respectively, since the two matters could overlap.
The chair of the working group and the Innovation Office consider that there is
merit in this proposal and propose that a statement be included in this policy document to
the effect that no-one is entitled to use the University’s name, trademarks or other
insignia without permission and that the giving of this permission also be made the
responsibility of the Committee proposed in this document.
Typical situations in which an outsider would want to request permission to use
UCT’s trademarks and other insignia would be: (i) if someone wanted to manufacture,
say, pens or T-shirts with the UCT crest or insignia in order to sell them to students and
other interested parties; or (ii) if an organization, such as a charity, which is supported by
UCT or by one of its Departments, wanted to indicate to the outside world its association
with UCT
Clearly such use must be subject to contract in each case, after scrutiny of the
exact way in which UCT’s name or insignia will be used; and if it is to be used on a
product, after making sure that the product is of an appropriate quality.
The Committee proposed in this document would then have to be called
something like the ‘Committee for the Endorsement of Products and Services by UCT
and the Use of UCT’s Name, Crest and other Insignia’. This might be a cumbersome
name, but for the name to refer only to the endorsement control would be misleading.
ANNEXURE A
DRAFT
RULES ON THE ENDORSEMENT OF PRODUCTS OR SERVICES BY UCT;
AND ON LICENSING THE USE OF THE NAME, TRADEMARKS AND OTHER
INSIGNIA OF UCT
THE DECISION-MAKING ENTITY
All decisions in regard to this policy will be taken by the Committee for the Endorsement
of Products and Services by UCT and the Use of UCT’s Name, Crest and other Insignia
(‘the Committee’), consisting of:
The Deputy Vice-Chancellor (responsible for Research and Innovation);
The Director of Communications;
The Registrar; and
a member of Council.
A. ENDORSEMENTS
THE PRINCIPLE
The University of Cape Town does not normally endorse products or services. However,
exceptions may be made and requests for such an exception to be made must be lodged in
terms of the rules set out below.
DEFINITION OF “ENDORSEMENT”
Any evaluative statement regarding a product’s quality is in principle considered to be an
endorsement.
An evaluative statement may be made explicitly or by implication.
The following actions will not be regarded as endorsements that need the prior
permission of the University:
a) Endorsements by individual members of staff in their personal capacity.
(However, if a member of staff’s affiliation to UCT is revealed, the endorsement
must contain a statement that it is being made in the staff member’s personal
capacity and that the statement does not reflect the views of the University of
Cape Town.)
b) Statements of fact by suppliers to the University of Cape Town to the effect that
the University of Cape Town is a client.
For the avoidance of doubt, it is specifically recorded that the naming of chairs and
buildings do not fall under this policy and is dealt with by separate processes within the
University.
PROCEDURE TO OBTAIN PERMISSION FOR AN ENDORSEMENT
Any supplier of goods or services to the University of Cape Town or any of its faculties,
departments (or to other entities within the University), or any other entity, wishing to
obtain an endorsement from the University or any of its constituent units in respect of its
goods or services, must direct an application to the Committee, via the office of the
Registrar.
The Committee will be called together when the need arises and will deal with each
application as expeditiously as possible.
GUIDELINES
In deciding whether permission should be granted, the Committee will be guided by the
following considerations:
(a) The need to protect the reputation of the University of Cape Town is of overriding
importance. To this end the University will never endorse products or services that could
in any way harm the image of UCT or that might not be in the public interest.
(b) The Committee will, in all instances where it is relevant, establish (by seeking advice
from appropriate quarters, including legal advice where necessary) that the University is
not exposed to an unacceptable degree of risk by the endorsement and that the
University’s intellectual property rights have been secured. In particular, it is the
responsibility of the Committee to assess the possibility of the University being liable in
damages if the product or service proves to be defective in any way, and to ensure that
the University’s liability insurance covers such eventuality.
(c) Any advertisement, or any statement in the print and electronic media (including such
devices as the co-branding of products and internet links to the University of Cape
Town’s website or any of its departments or other entities) carrying an explicit or implied
endorsement by the University or any of its constituent bodies must be submitted in
advance for approval by the Committee.
(d) The Committee will in regard to all applications for endorsements – having taken the
necessary expert advice on the matter – determine the appropriate remuneration due to
the University in exchange for the endorsement and how it will be distributed within
UCT.
(e) Whenever the Committee permits the endorsement of a product, the Committee must
ensure that the permission is embodied in a contract with the applicant; and it must
communicate any conditions that it wishes to be included in the contract to the Registrar,
or to any other authority charged with signing the contract on behalf of the University.
(f) The Committee must take appropriate advice from the Director of Finance regarding
the tax implications of income generated by endorsements.
(g) The University will deal with any breach of this policy by a member of staff or
student through the Staff Disciplinary Procedure or Student Disciplinary Procedure and
the University reserves the right to take appropriate legal action against staff, students
and parties external to UCT in regard to the infringement of its intellectual property
rights.
B. LICENSING OF THE USE OF THE NAME, TRADE MARKS OR OTHER
INSIGNIA OF UCT
THE PRINCIPLE
The University of Cape Town strictly controls the use of its name, trade marks and other
insignia, but it will in appropriate instances allow its name, trade marks or insignia to be
used on or in connection with products or services, or by organizations or charities that it
supports.
PROCEDURE TO OBTAIN PERMISSION FOR THE USE OF UCT’S NAME,
TRADEMARKS OR INSIGNIA
Any manufacturer of goods or supplier of services who wishes for any reason to
reproduce UCT’s name, trademarks or insignia on any product or in relation to any
services, or any organization who wishes to use UCT’s name, trademarks or insignia in
connection with that organization or its activities, must direct an application to the
Committee, via the office of the Deputy Vice-Chancellor (Research and Innovation).
GUIDELINES
In deciding whether permission should be granted, the Committee will be guided by the
following considerations:
(a) Any advertisement or publication in the print and electronic media in which UCT’s
name, trademarks or other insignia are used (including such devices as the co-branding of
products and internet links to the University of Cape Town’s website or any of its
departments or other entities) must be submitted for approval in advance by the
Committee.
(b) The Committee will not grant permission unless it is satisfied, after consultation with
the appropriate offices within UCT, that the permission is granted in terms of a contract
which properly secures all aspects of the University’s rights to its name, trademarks and
other insignia.
(c) The Committee will be called together when the need arises and will deal with each
application as expeditiously as possible.
(d) The Committee will in regard to all applications for permission to use UCT’s name,
trademarks or other insignia – having taken the necessary expert advice on the matter –
determine, where appropriate, the remuneration due to the University in exchange for the
permission, and how it will be distributed within UCT.