CAF defends terminating 1bn-USD rights deal with Lagardere Sports

0 Comment(s)Print E-mail Xinhua, November 9, 2019
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CAIRO, Nov. 8 (Xinhua) -- The Confederation of African Football (CAF) defended on Friday terminating a one-billion U.S. dollar agreement with the French Lagardere Sports group for marketing rights and television rights for the continent's competitions.

In a statement, the CAF, which is based in Cairo, said the termination of the agreement was a legal consequence of the decisions, judgments and recommendations of two different continental competition committees.

Lagardere, which has the exclusive marketing rights for the African competitions until 2028 under the canceled deal, said in a statement on Tuesday, describing the CAF move as an "unlawful, unreasonable and unjustified".

The French agency said it will "take any and all action" to defend its rights and obtain compensation.

In 2015, CAF and Lagardere announced a 12-year extension of a previous deal that ran from 2009 to 2016.

The new controversial deal has been investigated by the Egyptian Competition Authority (ECA) and the Competition Commission of the Common Market for Eastern and Southern Africa (CCC) for legal violations.

"In 2017, ECA found that the agreement breached Egyptian competition rules because Lagardere was appointed as CAF's exclusive agent for the marketing and media rights for an uninterrupted 20-year period without any open tender," CAF said in the statement.

By the same decision, CAF said, ECA declared the agreement null and void and imposed a number of remedies on CAF, adding that "those remedies included the obligation to immediately terminate the agreement and suspend its effects within the Egyptian market."

The Economic Courts of Cairo then issued two judgments in 2018-2019, CAF added, whereby they found the two former CAF officials, the former President, Issa Hayatou, and the former Secretary General, Hicham El Amrani, who signed the agreement, guilty of anti-competitive and fraudulent conduct.

The courts imposed a fine of 500 million Egyptian pounds on each of them, CAF said.

"On appeal, the fine was reduced to EGP 200 million and CAF was held to be jointly liable for the payment of that fine."

The African football's ruling body further said that CCC assessed in 2017 that the agreement infringed the CCC Competition Regulations.

"It recommended the imposition of a financial penalty on CAF and the adoption of certain remedies, including the termination of the agreement," according to the CAF statement.

"CAF had no choice but to terminate the agreement. CAF has repeatedly made it clear to Lagardere, including at a meeting this week, that its termination of the agreement was not a "unilateral decision" as was wrongly presented in Lagardere's recent press release," CAF said.

The body added that it invited Lagardere to discuss appropriate next steps and cooperation to ensure the fulfillment of the obligations toward sponsors, licensees and football fans with respect the current competitions.

"Lagardere has not taken CAF up on that invitation," CAF pointed out. Enditem

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