|
NUMEROUS PARTIES CLAIM LEAGUE SATELLITE RIGHTS
BY AMRO HASSAN
Football is a booming industry in Egypt and across the globe. It is the only sport in Egypt that players, administrators and directors all take up as a profession. Most top level players are earning hundreds of thousands of pounds every year, and millions of pounds are being invested by clubs to support the game. However, the latest row between Al Ahly sports club and the Egyptian Football Association (EFA) over football league broadcasting rights has left us all wondering whether the industry is really owned by sporting clubs, the Football Association or the government.
Since launching their private channel, Ahly TV, in August, Ahly have been demanding the full rights to exclusively market their league games’ satellite broadcasting. The EFA, however, strongly opposes this claim, asserting that since it regulates and organizes the Egyptian league then it has a right to market the games’ broadcasting. There is also a third party involved, the Egyptian Radio & Television Union (ERTU), as Egyptian law states that the union is the only organization allowed to issue any broadcasting signal from within the republic.
It was only three years ago that the EFA took the initiative of marketing the league’s satellite broadcasting. This move was welcomed by all clubs, including Ahly, which were happy to get any extra income separate from the terrestrial broadcasting’s poor revenues. At first, and upon the ERTU’s directions, the EFA rejected an offer from Arab Radio & Television Network (ART) to buy the exclusive satellite broadcasting rights. The ERTU was firm that the public Egyptian Satellite Channel (ESC) and Nile Sports Channel (NSC) should both be allowed to broadcast league games under any circumstances.
In 2006, the EFA accepted a joint offer from several satellite networks to buy the broadcast rights. The result was a three-year contract (to expire at the end of the current season) with each network paying LE 2.6 million for the initial year with an annual raise of 10 percent. But now that they’ve got their own private channel, and to the EFA’s dismay, Ahly want to broadcast or market their games independently. “Article 83 of the current EFA contract with the satellite networks allows any club to pull out of the deal upon establishing a private television channel,” Ahly board member Khaled Mortagy says.
Waleed El-Hosseiny, sports columnist for the daily Al Gomhouriya, understands why Ahly’s desire to market their games independently is upsetting many people. “Of course it is not in the ERTU’s nor the EFA’s interest that Ahly or any other club privately market or broadcast their games. The ERTU and the EFA are getting financial benefits from taking part in marketing the games, and any breakaway will simply mean heavy financial losses to both parties,” he says.
Whereas movies, books, songs and new inventions are covered by Egyptian intellectual property rights (IPR) law, there are no specific guidelines regarding sports products. “The Intellectual Property Law, No. 82 of 2002, doesn’t include any specific articles regulating sports copyrights whatsoever. That’s why in Ahly’s case the issue would be drawn under the law’s protection for broadcasting rights in general, which can include any non-sporting events,” says Mohamed Hussein Abdul-Sadek of Abu-Ghazaleh Intellectual Property (AGIP), a specialized IPR law firm.
The absence of any sports law in Egypt has led each party to refer to certain legal arguments in its defense. “Article 36 of the EFA’s regulating system, as well as articles 74 and 75 of the International Football Association (FIFA) guidelines, grant national football federations all the marketing, advertising and media rights for any competition organized by the federation. It’s the same as what happens in the World Cup and the European Cup, where national federations, in cooperation with FIFA, market and merchandise similar international events,” says EFA official spokesman Medhat Shalaby.
Obviously, Ahly officials are in disagreement with Shalaby’s perspective. Mortagy stresses that international competitions differ from local leagues. “Unlike any international championship, we as a club are the owner of any event we broadcast or merchandise in the Egyptian league. We are responsible for funding our games as well as taking care of all the necessary expenses to hold a home league game, including renting the stadium and paying for security. I think it’s crystal clear that once you pay for an event, you own it,” argues Mortagy.
However, it’s still a matter of debate whether this renders the club totally independent from the government. “Despite their massive financial capabilities, Ahly are still receiving a government subsidy in the shape of the humble LE 1 a month they pay for renting the land on which their headquarters is located in Gezira,” El-Hosseiny says.
The situation is significantly different in countries such as Germany, Italy and England, where clubs have the sole rights to merchandize their products and events. European football clubs are private and self-governed enterprises, and each club is technically owned by a major shareholder, whether it is a person or an investing company or group, and this major shareholder has the first and last say on the club’s policies and decisions.
In the English Premiership, for example, clubs have collectively – and without any interference from the English Football Association – sold the league’s terrestrial broadcasting rights to the BSkyB and Setanta Sports networks. Further distribution of the league games is only possible with the agreement of no less than 13 of the 20 clubs.
In Italy, clubs opted for more individual marketing. Last year, 10 Serie A clubs withdrew from the contract between them and the Italian Football Federation because they saw that they were not being treated on an equal footing with bigger clubs, and they have since marketed their matches in their own way. In general, all European clubs own their merchandizing rights, whether they market them in cooperation with other clubs and national federations or decide to promote their products individually.
Unlike in Europe and North and South America, no Egyptian premier league clubs are privately owned. Most clubs, such as Ahly and Zamalek, were established as public non-profit enterprises. Additionally, all clubs still receive minor financial aid from the Egyptian Ministry of Youth & Sports and the National Sports Council (NSC). Some lower league clubs are unable to survive without the government’s intervention or the financial support offered by NSC.
Ahly officials argue that with a yearly budget of over LE 100 million, the club is not dependable on the NSC or the ministry of sports in any form. “Ahly was established in 1907 as a public limited company. The club was nationalized in 1958 and since then it has been the property of its own general assembly. The assembly consists of the club board and all club sporting and social members, and those two are the sole owners of the whole club,” says Ahly board member Mahmoud Bagneid. “We don’t take any financial support from the government and we pay taxes as a private company, thus we are the only side capable of organizing, marketing or even halting our activities,” he adds.
Mohamed El-Fateh of Abu Ghazaleh Intellectual Property law firm agrees with Bagneid that Ahly is the most independent sports club in Egypt. However, the legal consultant stresses that any club can claim their broadcasting rights regardless of such a fact. “It is true that the club is totally independent from the state in terms of both finances and administration. They are by far the richest club on the African continent, and their general assembly is capable of running the club’s elections and activities.”
El-Fateh adds that any legal personality, whether a person, organization or sporting club, is allowed to register its product’s copyrights. Once they’ve done that they become fully entitled by Egyptian IPR law to claim the sole merchandizing and marketing rights of their product or service. Ahly have legally registered their copyrights and therefore they have a solid case in demanding the exclusive marketing of their football games, he explains.
However, Shalaby still believes that despite Ahly’s financial independence from the government, all football clubs in Egypt are still directly connected to the government in one way or another. “There’s a massive difference between the football business here and abroad. For example, if the Egyptian minister of petroleum isn’t interested in the game, he can simply liquidize ENPPI football team, which is an affiliate of the public oil sector. It’s the same case with the Police Union team, which is owned by the Ministry of Interior.”
Similar to many industries, football is a business Egyptians imported only to manage in a way of their own. Lacking any of the legal guidelines followed in the West, there remain moral, political and historical considerations that directly affect the business. Egyptian IPR law still cannot guarantee any party its full rights, and unfortunately no one is able to determine who owns the business.
“The football scene in Egypt is vague, and you can’t depend on any rules organizing it,” El-Hosseiny notes. “All Egyptian clubs are still considered public companies, regardless of any financial aid they receive from the NSC. It’s true that over the last few years the government has given a larger margin for clubs to invest privately, but when you look at it you’ll find how it contradicts the Egyptian sports law, stating that clubs are non-profitable facilities.”
With each party demanding a share in marketing the league’s broadcasting rights, it will not be until at least the end of the season, when the EFA’s current contract with satellite channels ends, that we will see whether Ahly are deemed eligible to market these rights on their own, or if the EFA and the ERTU should be involved.
Submit
your comment
Top
|
