Feb. 22 (Bloomberg) -- The U.K. government today released details of “special laws” and guarantees it would have had to give soccer’s governing body if England had won the right to host the 2018 World Cup.
The list of eight government guarantees was made public today following a Freedom of Information request from Bloomberg News during the bidding process. It reveals FIFA’s demands for tax exemptions, visa waivers and new laws to combat “ambush marketing.”
The guarantees would have cost the U.K. about 250 million pounds ($404 million), the U.K. Treasury said in a letter to Bloomberg News. The tournament could have contributed between 2.1 billion pounds and 3.2 billion pounds to the U.K. economy, according to a report for the bid team. The Treasury said no government money was loaned for the bid.
U.K. Prime Minister David Cameron, Prince William and former England captain David Beckham all lobbied FIFA officials, including its President Sepp Blatter, before the Dec. 2 vote that awarded the 2018 tournament to Russia. England finished last behind joint-candidatures from Spain and Portugal and the Netherlands and Belgium. Qatar was selected for 2022.
“All government guarantees are legally and constitutionally valid and enforceable against the United Kingdom,” the then-U.K. Prime Minister Gordon Brown wrote to Blatter on Dec. 14, 2009. He said the government irrevocably and unconditionally waived any right of immunity of the United Kingdom and its assets.
FIFA, which has tax exempt status in its home town of Zurich, said the guarantees “underline the commitment of the host country in staging the tournament.”
FIFA receives almost all its income from the quadrennial World Cup. Television and marketing rights to last year’s event in South Africa generated about $3.4 billion.
“A comprehensive tax exemption of the host country is absolutely necessary and has been accepted not only by (2014 host) Brazil, but by all previous host countries in respect to earlier editions of the FIFA World Cup,” the governing body said in an e-mailed statement.
The bidding processes for the 2018 and 2022 tournaments were overshadowed by controversy after two officials from FIFA’s executive committee were suspended following a corruption investigation.
The list of guarantees would have necessitated the U.K. government enacting “special laws” for about 60 days before the tournament and for the same amount of time afterwards, the documents show.
Among the regulations requested by FIFA was that all ticket holders and officials be granted free visas into the country. Home Secretary Theresa May, in a letter dated Sept. 23, 2010, agreed. She said the U.K. government would bear 5 million pounds’ worth of the related costs, and the rest would be met by the English Football Association.
People “wishing to attend competitions and or events will not be denied entry visas without satisfying FIFA that important reasons exist,” the government said.
The government also ceded to requests from FIFA for tax exemptions for all its staff and service providers. Labor laws that would have impinged on FIFA’s ability to perform its activities would have been suspended.
At the World Cup in South Africa, some local traders complained they couldn’t benefit from selling products close to stadiums. The U.K. said it would meet FIFA’s requirements to create a 2-kilometer perimeter around stadiums, and said the right to conduct commercial activities there was subject to the approval of FIFA or its appointees. The government also agreed to suspend some labor laws that affected FIFA’s activities and to lift restrictions on the import and export of foreign currency.
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