Under the proposed bill, a new association right is included to protect official Olympic sponsors. This includes a list of words which, in combination, are prohibited.
For example, if any advertiser were to use the line "Come to London in 2012", it would count as an automatic infringement and entail a fine of up to £20,000. As such, it will be near enough impossible for most companies to acknowledge the Olympic Games without getting into trouble.
The law also reverses the standard presumption of innocence under English law by presuming advertisers guilty unless and until they can demonstrate they are not trying to associate themselves with the games.
The Institute of Practitioners in Advertising and the AA have separately written to Minister for Sport Richard Caborn about the measures laid out in the bill.
The IPA and AA have also questioned the government's strategy, suggesting the IOC has already signed up six top tier partners out of 10 for the 2010 Winter Olympics and 2012 Olympic Games, and potential sponsors are not being put off from backing the games with the current levels of protection.
Hamish Pringle, director of the IPA, said: "The government's case, which rests solely on the need to have legislation in place so as to be able to sign up sponsors next year, lacks proportionality."
The two groups are calling the introduction of the law "flawed and unwarranted" and argue sufficient protections are already in place to prevent ambush marketing around the games.
The new law is due to come into effect next spring.
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