FIFA’s dirty secret a $US400m TV rights deal before World Cup ‘vote’

Details of the $US400 million offer to FIFA for television rights to the World Cup are set out in leaked documents.

Sheikh Hamad bin Khalifa al-Thani and wife Sheikha Moza with the World Cup.

It was November 2010 and the bidding war for the 2018 and 2022 World Cups was at its most frenzied. Nine nations, including Australia, were hoping that the prize of hosting the world’s greatest football competition would be theirs.

But the tiny state of Qatar had emerged as the unlikeliest of contenders — and the rumour was that it might go all the way. Behind the scenes, Qatar had been doing deals to win the 13 votes that mattered. Nothing, however, would be left to chance. So, with 21 days remaining before the ballot, Qatar put on the table an enormous take-it-or-leave-it offer. It would have enraged rivals if they had known, but it was, of course, a closely guarded secret.

Details of the unprecedented $US400 million ($567m) offer to FIFA for television rights are set out in documents that have now been leaked to The Sunday Times. Part of that sum was a $US100m success fee to be paid into a designated FIFA account if Qatar was granted the right to host the 2022 competition.

This sum was offered as part of a television rights contract by the Qatari broadcaster Al Jazeera, owned by the country’s emir, Sheikh Hamad bin Khalifa Al Thani.

Since the emir was the driving force behind the bid, the deal represented a clear conflict of interest for FIFA. It was also a flagrant breach of its own rules, which bar bidding countries from offering financial benefits to the governing body in connection with the vote.

Nonetheless, Sepp Blatter, then FIFA’s president, and secretary-general Jerome Valcke, completed the deal when they countersigned the contract the week after Qatar’s December 2010 victory.

Details of the contract have remained a secret ever since — despite FIFA’s claims to have cleaned up its act after the scandals that brought down its leadership. Some of the payments from the contract are now flowing into FIFA’s accounts.

The World Cup in the desert had started out as an improbable pipe dream. The temperatures in Qatar were too high to play competitive soccer in the summer and the state had neither a soccer tradition nor the infrastructure to hold the world’s biggest sporting competition.

But the pipe dream belonged to a man with untold riches. Tall and broad-shouldered, Hamad had overthrown his own father to take control of the world’s wealthiest country per capita. As emir he gained complete control of its finances.

He planned to modernise Qatar by turning it into an international hub for sporting events. Since the World Cup would be the jewel in the crown, he committed substantial sums to the Qatar bid committee, which announced its candidature in March 2009.

The entire state apparatus was mobilised behind the bid. A circular was sent out by the emir’s governing office ordering all ministries and other state-run organisations to co-operate with the bid team.

Over the next 18 months, Hamad played his own role in the bid, meeting Blatter and other key voters from the 24-man FIFA executive committee, who would decide on where the World Cup would be held.

One of Qatar’s chief assets was its top soccer official, Mohamed bin Hammam, who used secret slush funds to make dozens of payments totalling more than $US5m to senior football officials to create a groundswell of support for his country’s bid.

Bin Hammam, a member of the FIFA executive committee, who was separate from the official bid team, made payments of $US1.6m into the bank account of one of his fellow voters and gave another €305,000 ($486,000) that effectively prevented a vote against Qatar. He also brokered government-level talks for the Thai voter to push a gas deal that was potentially worth millions of dollars to Thailand.

Meanwhile, the bid team members drew up a contract to pay the son of another voter $US1m to host a dinner for African football stars, although they later pulled out of the deal. They also paid a New York public relations company to run a black operations campaign spreading negative publicity against its main rivals, the US and Australia. The bid team deny any wrongdoing.

Al Jazeera was also harnessed to help. A few months after Qatar announced its intention to bid, the broadcaster acquired its first television rights for the competition. The 2010 and 2014 World Cup rights for the Middle East and north Africa regions were part of a wider package Al Jazeera bought from the Saudi broadcaster Arab Radio and Television Network that had broadcast the 2006 competition. An academic paper has reported that the network originally paid FIFA about $US100m for those three World Cups.

The next big deal was the TV contract for the 2018 and 2022 World Cups, which was an extension to Al Jazeera’s existing rights deals. It was signed by Al Jazeera on November 11, 2010, three weeks before the vote to determine the hosts was due to take place. Lobbying for the two competitions was feverish.

From the outset, the deal was peculiar. There was no competitive tender process, unlike other World Cup broadcast rights deals in other parts of the world. It went against FIFA’s previous public commitment to hold tenders to show its transparency. The timing was also premature as the venues for the two competitions had not been decided. No other television rights deal would be agreed by FIFA for those competitions until the next year, long after the vote.

The contract was signed by Al Jazeera general manager Nasser bin al-Khelaifi, who would later lead the controversial Qatari buyout of Paris Saint-Germain football club. It offered to pay $US150m to broadcast all FIFA events to the north Africa region over a four-year period in which the main attraction would be the 2018 World Cup, and the same amount again for the period that included the 2022 competition.

The sums were a record for the region. Experts who have looked at the deal say it is difficult to justify such a big increase on purely commercial terms. And there was even more cash on the table if Qatar won, a $US100m bonus.

Even by the standards of world soccer, this was a giant success fee. The contract says the $US100m would be a contribution to FIFA’s production costs for the 2022 World Cup and would also reflect the higher value of rights to the broadcaster if the competition was on home soil.

In reality, though, experts say Qatar’s 2.6m population and the limited commercial value of the region means any extra revenue gained from being the host country would be a fraction of the sum offered. FIFA executives were breaking their own rules, which state that any entity or individual “affiliated” with the bid team should not provide any remuneration to FIFA linked to the bidding process.

There was no doubt that Al Jazeera was affiliated to the Qatar bid team as its owner, Sheikh Hamad, was funding the entire operation. And the contract had a success fee linked to the award of hosting rights for the World Cup.

At the time the broadcast contract was signed, Qatar’s bid to host the World Cup was also embroiled in unprecedented controversy. The previous month, FIFA had been rocked by the votes-for-sale investigation by The Sunday Times, which secretly filmed two executive committee members discussing the sale of their votes for cash. The paper produced evidence including recordings of two former executive committee members — Amadou Diakite and Ismail Bhamjee — alleging Qatar was offering voters up to $US1.2m for their support.

FIFA had promised to investigate all the wrongdoing on the tapes. But, out of the public gaze, it was negotiating the television deal with Al Jazeera. On November 17, 2010 — six days after the broadcaster’s signed contract landed at FIFA’s Zurich headquarters — the body announced the outcome of its inquiries. Eight officials, including the two voters filmed while discussing the sale of their votes, were suspended. Among them were Diakite and Bhamjee, who were banned for disloyalty and talking out of turn. Their allegations about payments were never investigated.

A separate inquiry into allegations of illicit collusion between Qatar and the 2018 bidder Spain were dropped after only cursory inquiries. But that day and ever since, FIFA chose to hide its blatant conflict of interest presented by Qatar’s $US400m contract.

There were two executive committee meetings in the short time between Al Jazeera signing the contract and the World Cup ballot. The meetings are private so it is not known whether the members were asked to ratify the contract. One of the contract clauses states that FIFA would receive a $US6m downpayment within 30 days of the agreement being finalised.

At the second executive committee meeting, on the eve of the ballot to choose the 2018 and 2022 hosts, Blatter announced that each of the voters would be given a $US200,000 bonus. It cost a total of $US4.8m and Blatter said the windfall was down to the success of the South African World Cup. The next day it was Sheikh Hamad who strode on to the stage in Zurich and hoisted the World Cup aloft. Qatar had won.

With the $US100m success fee now assured, Blatter and Valcke countersigned the contract the next week but waited six weeks before publicly announcing the television deal. To the world, it looked like the contract had been negotiated after the World Cup ballot when there was no conflict of interest and no breach of the rules.

The details of the contract have remained a secret. There is no reference to it anywhere in the inquiry by FIFA’s investigator, Michael Garcia, who spent two years looking into allegations of corruption in the December 2010 ballot.

However, Sheikh Hamad, who handed his throne to his son in 2013, is mentioned in Garcia’s inquiry report. He notes that the emir’s involvement did illustrate “concerns about World Cup bidders recruiting or standing behind government officials or other agents who then do what FIFA rules forbade bid officials from doing directly”.

A spokesman for beIN, the spin-off of Al Jazeera, declined to respond to “unsubstantiated” allegations and said it had followed “the relevant process” in all of its negotiations. He said the award of World Cup rights had been “investigated extensively, and no wrongdoing has been found concerning our involvement”.

FIFA refused to comment on the allegations, saying it had already “extensively commented” on the investigation into the 2022 World Cup in the past. Blatter, Valcke and the Qatari embassy declined to comment.

THE SUNDAY TIMES