How to Win the World Cup – Part 1
Throughout the pandemic the sports industry has generally been thinking about short term risks and opportunities: how do sports stakeholders make ends meet amidst the disruption and comply with financial fair play rules? How do cash strapped participants attract new investors? How to keep broadcasters onside? However, in light of the speed and success of vaccine roll-outs and the prospect of large global sports events taking place this Summer (albeit COVID-adapted), it is time to start looking further ahead again.
The 2030 Men's football World Cup feels distant on the sporting horizon, but FIFA is set to formally open the bidding process to host the competition in 2022. Many would-be hosts are fluttering their eye lids at the prospect of hosting one of the world's most high-profile events, which can help to showcase a country (or countries, as is the case for the 2026 World Cup, to be jointly hosted by Canada, Mexico and the United States), attract a large number of visitors and drive economic investment: the 2012 London Olympic and Paralympic Games was estimated to provide a £9.9bn boost in trade and investment to the UK economy. In March, UK Prime Minister, Boris Johnson, pledged £2.8m in government support towards a potential UK-Ireland joint 2030 bid. The UK-Ireland bid joins a growing list of nations either expressing an interest or confirming plans to submit a bid, including a joint South American bid (Uruguay, Chile, Paraguay and Argentina) on the centenary of the first ever World Cup, hosted in Uruguay in 1930.
Many key legal and commercial considerations come into play when hosting a sporting event on the scale of the World Cup. A remarkably wide range of stakeholders (from governments to fans, to the world's leading brands, participants in industries such as aviation, security, real estate, construction and many more) should be attuned to these in order to deliver an unforgettable tournament, both on and off the pitch. This post will focus on the process for planning a World Cup bid and selecting a host.
In it to win it – the bidding process
The process for selecting the host(s) of the 2026 World Cup saw a revamped bidding process that emphasised transparency, objectivity, open participation and a commitment to human rights and sustainability. Whilst the process, rules and timeline for the 2030 process are yet to be approved and announced by FIFA, it is expected that the 2030 process will closely follow the 2026 example.
Timeline, Process and Bid Documentation
At the October 2019 meeting of the FIFA Council (a supervisory, non-executive, strategic body), it was agreed that the bidding process will be launched in Q2 2022 with the announcement of the host at the FIFA Congress in 2024 – the annual meeting of FIFA's 211 national members (FIFA's "General Assembly"). As well as these key milestones, there will be further interim deadlines including the approval of the 2030 bidding process rules (likely at the 2021 FIFA Congress being held virtually in May 2021), deadlines for the registration of interest and the submission of bids by each host candidate.
The bid itself requires a wide suite of documents to be submitted at various stages of the process. Principal in these documents is the Bidding Agreement, in which a candidate gives a binding undertaking to FIFA that it will enter the bidding process, and the Bid Book, essentially a "bid prospectus", containing all the mandatory information: from the strategic vision of a bid to background information on the economic, political, media and commercial environment of the host nation to specific technical details on stadia, health systems and airport infrastructure in the format prescribed by FIFA.
Perhaps most interesting from a legal perspective is the requirement of a government declaration pledging the full support of the government authorities at federal, state and municipal level in a host country or countries, backed up by specific guarantees. These guarantees range from agreeing that the flag of every competing nation must be flown to visa-free/non-discriminatory labour, immigration and travel requirements, wide tax exemptions for FIFA, specific individuals, its contractors, broadcasters and special protection of FIFA's commercial rights (including against any unauthorised association or ambush marketing). The complexity of such guarantees and any legislative changes required to cater for them are multiplied in the joint-host scenarios where various legal jurisdictions are involved (for example, the UK-Ireland bid would include four separate legal jurisdictions: England and Wales, Northern Ireland, Scotland and the Republic of Ireland).
Each of these key legal considerations and the implications for the stakeholders in host countries will be assessed in more detail in a follow-up blog post.
Selecting a winner
Once the bid submission process closes, the winner is selected by a vote of the FIFA Congress. The Congress votes on a majoritarian basis, requiring that the winning bid receives an absolute majority. If an absolute majority is not reached on the first ballot, the lowest place bid is eliminated and the vote is re-run until an absolute majority is achieved. Any countries submitting a bid are conflicted and are not permitted to vote.
The FIFA Council selects a winner based on "aiming to achieve the objective of securing the best possible conditions in the host country(ies)". From the 2026 World Cup selection process onwards, a dedicated bid taskforce is set-up to evaluate and grade each bid and issue a public evaluation report, prior to the selection by Congress. The taskforce grades each bid on the basis of a specific infrastructure criteria (quality of stadiums, facilities, transports, telecommunications, fan events, etc.) and a specific commercial criteria (overall costs, predicted revenues). Underlying the entire bid process is the expectation that a country will host the tournament in a sustainable manner, minimising any adverse impacts on human rights and the environment.
On the pitch, it is clear that those teams with the best management, advice and coaching support stand the greatest chance of World Cup glory. Off the pitch, when it comes to bidding for and hosting a tournament on the scale of the World Cup, it is no different. Part 2 of this post will explore some specific legal hurdles to be overcome to successfully host the tournament. The size and complexity of the task ahead for bidders is considerable - this post’s overview of the overhauled bidding structure, noting a greater emphasis on transparency and FIFA contributing to the global focus on ESG, still does not account for the behind-the-scenes discussions and skilled diplomacy to garner the necessary support for a successful bid. The costs of such a process do not come cheap: according to the English Football Association's accounts, the total expenditure on England's failed 2018 World Cup bid was £21m, including both government and sponsor spending.
These challenges show that, like those teams who will be vying for the trophy in 2030, expert advice and strategic direction off the pitch will be required to ensure the bidding process is managed effectively and all stakeholders are pulling in the right direction.