The men’s World Cup 2022 held by Qatar is arguably the most controversial in the history of the competition. The competition is finally over with Argentina emerging as the winner after the final match with France, marking the third World Cup win for the country since 1778 and 1986. This is the 22nd World Cup since the international football competition began in 1930, and Qatar was granted hosting rights. Although Qatar had never previously appeared at a World Cup tournament, it is the first Middle East country to host the World Cup.
The football tournament usually contested by various national football teams is organised every four years by the Fédération Internationale de Football (FIFA), in English, International Association Football Federation.
FIFA is made up of 211 national associations, outnumbering the United Nations. As the international governing body of association football, FIFA is responsible for the organisation and promotion of major football international tournaments, notably the World Cup which was first held in 1930. The economic impact of the World Cup is enormous, providing various tangible and intangible benefits to stakeholders. For example, countries with hosting rights enjoy great exposure and various sectors such as the economy tourism, transport, construction and foreign trade are improved. For instance, it is expected that there will be an acceleration in Qatar’s GDP growth this year. Awareness about Qatar and the entire Middle East has definitely improved as Qatar is the first Middle East country to host the tournament. And although, the granting of hosting rights to Qatar first brought up controversies about the country’s ability to host the games due to the extremely hot climates during the Middle East summer. The tournament was, however, played between November to December 2022 to avoid the intense heat, even though the World Cup is usually played during the European off-season in June and July. Albeit, it is safe to say that Qatar 2022 World Cup was a success.
In order to organise an international tournament such as the World Cup, various commercial deals are entered into and these would usually necessitate the making of certain contracts, and these would come up at different stages of planning to allow for a smooth delivery and to ensure that future legal mishaps are avoided. Here are a few of them.
Profit Sharing Contract
Media contracts can be very lucrative for FIFA and other sports organisations because of the large number of people who watch international tournaments such as the World Cup and the promotions that go with them. For a tournament such as the world cup, it is expected that revenue will be generated. There is a need to agree on the formula for sharing profits. FIFA pays for host countries’ organising committees, prize money, travel and accommodation for teams and support staff. The body also pays for a legacy fund to help develop the sport in the host country after the World Cup. However, the host countries have no part in the profit sharing as much of the profit from ticket sales, broadcasting and marketing revenue all go to FIFA. Usually, such contracts could be between FIFA, the organising body and its corporate partners or affiliates. For instance, an article published by Reuters in 2015 revealed that FIFA entered into an agreement with the Caribbean Football Union and involved media rights in parts of the Caribbean for the 2010 and 2014 World Cup competition and FIFA was expected to receive 50 per cent of all revenue from the sale of broadcast sponsorship and TV commercials.
Employment Contracts
During the planning and organisation of the event, the services of certain professionals will be required. Employment contracts will cut across all the bodies involved in the planning including FIFA, the host country and other affiliates and partners. In 2010 when Qatar secured the bid to host the 2022 World Cup, migrant workers were invited into the country as employees in constructing various infrastructure for the tournament including stadiums. However, the controversies leading to the allegations of human rights violations continue to trail the 2022 World Cup. Being the smallest country ever to host the World Cup, Qatar has a population of about three million people, only three hundred thousand of whom are permanent residents. An investigation by a German journalist, Benjamin Best revealed severe conditions that world cup workers who are mainly migrant employees live with. Information from the Nepali government revealed that 1,426 Nepali workers in Qatar died between 2009 and 2019, with 111 dying in 2019 as of June 6, 2019. An International Trades Union Confederation report estimated that 7,000 workers could die in Qatar before the tournament began. Also Amnesty International first reported numerous human rights violations arising from the pressure the country was under to meet the 2022 deadline.
About 1.7 million migrant workers which make up 90% of the total workforce in Qatar were all underpaid and subjected to bad working conditions. These migrant workers were brought in to build the infrastructure for the tournament including stadiums, and roads. Although all these led to Qatar enacting laws protecting workers in September 2018, efficacy was still an issue. The reforms included implementing a temporary $200 minimum monthly wage, establishing a dispute resolution committee, and lifting the requirement that foreign workers receive permission from their Qatari employers to leave the country. However, there were reports of workers going on strike to protest poor working conditions, delayed wages and threats of pay cuts. Employment contracts usually serve to guarantee the working conditions for employees providing for salaries or wages, and other condition.
Read also: Ten facts about Qatar 2022 World Cup
Procurement Contracts
During the organisation and planning for the tournament, FIFA will procure the services of partners to work as part of its team. For instance, before the 2022 World Cup took place, the Supreme Committee for Delivery & Legacy asked companies to join as partners to deliver infrastructures for the tournament. This affords local, regional and international businesses the opportunity to partner with the body. Suppliers of materials, construction companies, and contractors will usually enter into a procurement contract with FIFA.
international tournaments such as the World Cup, involve various commercial deals and these require several contracts
Contract for Service
Contracts for service are contracts, unlike the employment contract is one entered into to engage the services of an independent contractor. The contract is legally binding on parties who agree to it and usually evidences the contracting of a professional who works independently and is not in the full employ of the contracting party. The service is usually required on a temporary basis and there is no need for full-time employment. An example of such a contract will be one entered into by the Qatari government with the China Railway Construction Corporation Limited which was the main contractor in the construction of the Lusail stadium in Qatar. The golden bowl-shaped 80,000-seat capacity venue is located in Lusail, some 20 kilometres north of Qatar’s capital Doha, the stadium was completed in 2020 after 40 months of construction.
Tax exemption agreements
In order to host the World Cups, countries are meant to bid for hosting rights. Any country bidding must submit a bid proposal that lists why it makes financial sense for FIFA, as well as how it will improve the sport’s global reach. Therefore, FIFA requires bids to host the tournament to include massive tax exemptions for the body. For instance, Germany offered FIFA an estimated $272 million in tax exemptions when it hosted the games in 2006.
For Qatar, the Ministry of Finance published Decision 9 of 2022 implementing tax exemptions and customs procedures for hosting the FIFA World Cup. Part of the tax exemptions was conferred on resident and non-resident FIFA and FIFA affiliate organisations, Continental Confederations, National Football associations, broadcasters, suppliers, contractors and service providers who are all collectively referred to as “participants” exempted individual (personal) taxation until December 31, 2023; non-resident contractors fulfilling contracts with FIFA and FIFA affiliate organisations within and outside of the state of Qatar exempted from transfer tax, import and export tax provided that the goods, services and rights are fully utilised as well as; resident and non-resident beneficiaries exempted from excise duty on condition that they apply for a refund of excise by supplying original invoices, bank account certificate and proof that purchase is related to FIFA related activities. The agreements establish tax-free zones for the World Cup venues so that FIFA’s corporate partners or affiliates are exempt from income and sales taxes.
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