Whistle Blown on FIFAs Murky Past

With his FIFA’s ethics committee coming down like a tonne of bricks on Mohamed Bin Hammam – the once powerful executive now banned for life from all football-related activity – Sepp Blatter would hope outsiders accept he is now delivering on his promises to get world football’s under-fire governing body back on track.

But banning one corrupt official for bribery is simply not enough.  In order to truly regain its moral authority in light of political controversy and scandal, FIFA must now turn over a whole new leaf.

Indeed, Interpol’s general secretary Ronald K Noble, writing for the New York Times, declared that “public confidence in FIFA’s ability to police itself is at its lowest point ever”.

The penalty meted out to Bin Hammam indicates that this message may finally be hitting home.  In the last eight months, a third of FIFA’s 24-man executive committee have faced allegations of corruption – though it would be fair to point out that these allegations have varied in terms of seriousness and plausibility.

But despite three bans and a resignation (of Jack Warner, the former President of CONCACAF), it seems apparent that much greater action is still needed to restore confidence.

One move which would be both timely and effective would be to install a more robust independent investigative organisation and ethics committee, while drawing up a comprehensive plan for rooting out corrupt practices at FIFA.

Also in dire need of reform is the manner in which World Cup hosts are selected.  With such huge sums of money and international political ramifications at stake, such important decisions can no longer be made wholly in private by a tiny group of unaccountable individuals.

However, if the reaction to recent events by those within the organisation is anything to go by, there is likely to be huge resistance to such reform.  When David Bernstein, the FA’s chairman, called for the presidential election to be delayed while allegations of corruption were investigated, he was met with fury and outrage by fellow delegates and almost contemptuously dismissed.

FIFA’s development and evolution has mirrored that of the wider footballing world, in its growth from amateur passion to professional excess, and transformation from small, voluntary agency into a huge, global giant.

Recently, the BBC highlighted six surprising facts about this secretive overlord of world football:

  1. It is a registered charity.  FIFA pays very little tax in its home country of Switzerland.  It also requires tax exemption in countries wishing to host a World Cup competition.  “Any host country requires a comprehensive tax exemption to be given to FIFA and further parties involved in the hosting and staging of an event,” a spokesman told the BBC last year.  The 2010 tournament – the most expensive yet – cost South Africa 33bn rand (£3bn; $4.86bn), but a “tax-free bubble” was established around the event at FIFA’s request, relieving FIFA, its subsidiaries, and foreign football associations of any obligation to pay income tax, customs duties or VAT.
  2. This charitable status dates from its early days as a tiny voluntary organisation run on goodwill from a suburban villa in Zurich, says David Goldblatt, author of The Ball is Round: A Global History of Football.
  3. Broadcast rights to the first televised World Cup – the 1954 tournament hosted by Switzerland and won by West Germany – were given away for nothing.  With a global TV audience numbering many millions, FIFA realised this was a goldmine.  By 1986, TV rights sold for 49m Swiss francs (£35m) – a fraction of the $2.4bn in broadcast earnings for the period of the last World Cup.
  4. FIFA set the template for modern sports sponsorship after an awkward scramble to secure advertising rights for its new partner, Coca-Cola, at the 1978 World Cup in Argentina.  A military coup two years earlier threw up a dilemma for the organisers, says sports marketing expert Patrick Nally.  With no control over the stadia, and no advertising agreements in place, how could FIFA ensure the soft drinks giant had a presence in such a strictly controlled country?  It came down to money.  FIFA asked Coca-Cola to advance it an extra 12m to 15m Swiss francs to buy these rights from Argentina, so it could then offer the company an exclusive relationship at its own event.
  5. Globalisation of the game came under Joao Havelange, FIFA seventh president and Sepp Blatter’s predecessor.  Spain expected to host 16 nations when it bid for the 1982 tournament; FIFA later told it this would be rounded up to 24, as Mr Havelange made good on his election promises to bolster training and opportunities for teams from Asia and Africa.  To subsidise this, FIFA again went cap-in-hand to Coca-Cola for an extra $40m in sponsorship. The only way to make this worthwhile was to guarantee its sponsors wide-ranging benefits from exclusive signage, licensing and merchandising. ”  And with that, the package of exclusivity and global coverage that defines modern sports sponsorship was born,” says Goldblatt, presenter of the BBC Radio 4 documentary Fifa: Football, Power and Politics.
  6. Today FIFA has more member countries than the United Nations – 208 to the UN’s 192.  Only eight internationally recognised countries are not FIFA affiliates, including Vatican City, Kiribati and Monaco.  How different then from its origins in 1904, when the representatives of seven European football associations banded together with the aim of improving football’s international reach.

Fifa: Football, Power and Politics was broadcast on BBC Radio 4 on 29 May

Stephen J Lownsbrough
Associate & Head of Sport
Blacks Solicitors LLP

Tel: +44 (0) 113 207 0000
Email: SLownsbrough@LawBlacks.com

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