36088-swt_21-1 Sheet No. 1 Side A 02/26/2015 12:25:41 1 UMBER WN O INANCIAL EFLECTIONS F RAZIL AND : R AVE ITS B H ETER D UP IN OOTBALL C F OOTBALL F ORLD ODIES TO ...... 9 B ...... 27 OCIETY SYMPOSIUM S ECTOR S URIDIFICATION IN NTERNATIONAL 2014 by Southwestern Law School 2014 FIFA W J I © TABLE OF CONTENTS OVERNMENTAL AW AND G SPORTING EVENTS AS SITES OF L THE 2014 BRAZILIAN WORLD CUP THE 2014 BRAZILIAN WORLD OOTBALL HOULD F ?...... 63 : S INTERNATIONAL LAW INTERNATIONAL ...... 1 ANS TUDY OF XXI 2014 N F S INTERNATIONAL LAW, SOCIETY, AND GOVERNANCE: INTERNATIONAL LAW, SOCIETY, SOUTHWESTERN JOURNAL OF JOURNAL SOUTHWESTERN The Honorable Fausto Martin De Sanctis Pedro Rubim Borges Fortes Kenneth Korosi, Kirsten Brown, Christina Marquez, Kenneth Korosi, Kirsten Brown, Christina Mauricio Salazar, and Sophia Segura Simon Archer E THE M K EQUIREMENTS OF EQUIREMENTS FOR THE OLUME RIMES IN THE ONSTITUTION OMMODIFICATION AND OREWORD F ON THE R C C Governing Football as a Commodity C V \\jciprod01\productn\s\swt\21-1\toc211.txt unknown Seq: 1 26-FEB-15 11:15 R W C Y 36088-swt_21-1 Sheet No. 1 Side A 02/26/2015 12:25:41 02/26/2015 A 1 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 1 Side B 02/26/2015 12:25:41 M K C Y S ’ N THE OALS OF HROUGH : I ATA G OREFRONT T OVERNANCE UP D RAZIL F NTERESTS C ...... 71 G OTTON I : B ONEY C NION M ORLD U OUNTER ELEVISION ARKET USINESS -C T W ORRUPTION ...... 175 M LYMPICS OVEMENT C ’ B ...... 125 THE GAINST TATES AT THE M - NDEPENDENT EEXAMINING THE S I A UROPEAN TATES ...... 155 : R VER AND THE E OCCER 2016 O S ITIZENS OLUTION TO ITS , UROPEAN OMPOSITIONS S O NITED S C E C S ...... 143 ’ TATES YSFUNCTIONAL IGHTING U NITED ORRUPTION S EGISLATION ILL THE D : F HE U -C L ATTLING UP TO THE RAZIL ENETIC : W : T EGULATIONS NTI ORRUPTION ...... 97 B NITED C : B ...... 217 R RAZIL ” G A ? ...... 195 ALANCE ITS , C U UP AND CT AND THE XPERIENCE OF THE ORRUPTION B ...... 237 EGULATION ON B UR C ORLD E A ATENTS C UTIES 2014 R ROBLEMS IGHTS P HE “O LOBAL AUNDERING D ARKETS UP IN P R ORLD L G RANK ORE THAN C ENE M ...... 165 RAZIL PPROACH TO ISPUTE WITH THE -F ROPERLY 2014 W M AUNDERING G B A P ONOPOLIES D S ONEY UMPING L ’ ORLD FIFA: T ENTURY ODD RIVACY M -D -M ROTECTING Thiago Bottino Sophia Segura Kirsten Brown Guillermo Jorge Mikhail Reider-Gordon Sohin Gautam Mauricio Salazar Warren S. Grimes Andrew Spalding, Patrick Barr, Albert Flores, Shaun Freiman, Patrick Barr, Albert Flores, Shaun Andrew Spalding, Klink, Carter Nichols, Ann Reid, and Kat Gavin, Tyler Rina Van Orden Roberto Delmanto Junior C P W FIFA W D P ST AKE OF ONEY NTI NTI ERIVATIVE ISTRIBUTION IN THE EFORM OLE IN THE OMMITTEE RAZIL HE AUNDERING AND HE IXING ROM THE UBSIDY WAPPING NFRASTRUCTURE SOLATED OF THE AND B 21 S I I D C Notes & Comments A S R A L and Governance Structures Institutional Agendas, Ethics, T D International Responses to Corruption and Money Laundering and Money to Corruption Responses International F R W \\jciprod01\productn\s\swt\21-1\toc211.txt unknown Seq: 2 26-FEB-15 11:15 FROM F T M 36088-swt_21-1 Sheet No. 1 Side B 02/26/2015 12:25:41 02/26/2015 B 1 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 2 Side A 02/26/2015 12:25:41 1 UMBER G TEPANYAN HUHAIMI ROWN N -S S ESHISHI AHIMI ASTER ADDELA AMIREZ HERSON ALEHANI B APIEWSKI AHMAN AMIREZ AUTAM P P K R HANVERDI AMALIGER ORENSEN ORALYAN S R P C M INTI ELIK R R G S K M M B M M ERMAINE OHIN NDREW ELLY ARMON ANDY MRAN G YLE MMA ANOLO S ICHELLE I ARILYN ULIANA ENISE S AMANTHA F EGHIN A K OLOMON J E K S M M S D N M YAFIQAH S UTZ ATHERINE OROSI K ORDON AERMAN K E. L N Staff F. F OBERT ELENE ENNETH Editor-in-Chief Faculty Advisors Managing Editor R ILVIA H K S VANS OX RNOLD EARD ALVO E ARQUEZ ROWN HANG ALAZAR ARCIA ARZAM OODMAN F DRIAN EGURA LYNN EROLD B A C INTERNATIONAL LAW INTERNATIONAL S B C M ALDIVIA GHBAL F G S ARSEGHIAN G F A H B E B LI RIN ELLEY YAN E COTT K A HITNEY ACHEL ICHAEL IRSTEN SOUTHWESTERN JOURNAL OF JOURNAL SOUTHWESTERN OPHIA OHN TEVEN ACHEL S R J S AURICIO R S K MANDA M OURTNEY W R ONYA HRISTOPHER HRISTINA Lead Article Editors Comment Editors Note & XXI 2014 N C M A T C C M K OLUME Research & Special Project Editors Associate Editors V \\jciprod01\productn\s\swt\21-1\boe211.txt unknown Seq: 3 26-FEB-15 11:15 C Y 36088-swt_21-1 Sheet No. 2 Side A 02/26/2015 12:25:41 02/26/2015 A 2 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 52 Side A 02/26/2015 12:25:41 , jug- 2 ITCH P ORRUPTIVE C S ’ Mikhail Reider-Gordon* UP C ORLD 97 W WAKE OF BRAZIL 2014 WAKE OF Airlifting Cash to World Cup Players Common Practice: Ghana AKING TO THE AND THE WORLD CUP: IN THE AND THE : T (July 2, 2014), http://www.reuters.com/article/2014/07/02/us-soccer-world-gha-idUSKB If one were to describe a business enterprise with members of the If one were to describe a business to reward those that earned the organization the most; limited all to reward those that earned the 2. For the purposes of this article, the definition of “football” is that of the Financial Ac- * Director in the Los Angeles Disputes and Investigations practice at Navigant. Mikhail 1. Kwasi Kpodo, MONEY LAUNDERING, CORRUPTION, MONEY LAUNDERING, 1 M K EUTERS NTRODUCTION I outsiders from scrutinizing their operations; kept an address in a rural outsiders from scrutinizing their and shield it from external media village in order to offshore its profits living in gated mansions, accompa- and tax authorities; with its leaders and sailing around on personal nied by security guards and cameras, in Lichtenstein, conducting all of yachts; held by companies registered it is likely that one’s in- its deals in backrooms with no transparency; enterprise was a large narcotics traf- terlocutor would suspect that this transnational criminal organization. ficking operation or some other anti-corruption enforcement—whereImagine in the era of heightened for allowing money laundering sanctions are imposed against entities to occur—pitching this enterprise to the general counsel or chief com- in the United States or Europe as a pliance office of a corporation potential business partner. out One might expect to be either laughed for having suggested even the of the room or summarily dismissed with such an entity—exceptthought of publicly doing business that the enterprise in this instance is the global professional football N0F72C220140702. tion Task Force’s: “The term football is used in different ways in different parts of the English- of the speaking world. The name soccer (or soccer football) was originally a slang abbreviation R organization who flew planes full of satchels of cash in from West Af- organization who flew planes full rica \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 1 26-FEB-15 11:21 Reider-Gordon Co-Chaired the American Bar Association’s International Anti-Corruption Committee (2012-1014) and now serves as the Committee’s Senior Advisor. She is a Council of Member of the ABA’s Section of International Law, where she also serves as Division Chair the Public International Law division. C Y 36088-swt_21-1 Sheet No. 52 Side A 02/26/2015 12:25:41 02/26/2015 A 52 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 52 Side B 02/26/2015 12:25:41 M K on C Y [Vol. 21 ed ´eration —as FIFA is 6 eration Internati- ed ´ match fixing, bid rigging, match fixing, bid paras. 32 n.9, 33. 4 In the wake of the most re- Id. 5 Despite decades of corruption Despite decades 3 http://www.fifa.com/mm/document/affederation/bodies/02/36/77/41/faq_ utbol (CONMEBOL) in South America; Oceania Football Confederation paras. 27-31 (providing statistical support while citing to Declan Hill for demon- available at SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW para. 44. Cf. id. Id. The year 2014 saw the FIFA World Cup hosted in Brazil. the FIFA World Cup hosted The year 2014 saw After 6. Questions on the Financial Report 2013 for Congress 2014, 64th FIFA Congress (June 5. 4. 3. FIFA’s purpose is to promote and develop football throughout the world. FIFA consists strating why football is susceptible to both small- and large-scale money laundering schemes). 10-11, 2014), finance_en_neutral.pdf. cent World Cup scandals that have come to light, if it is not business as cent World Cup scandals that have the Cup is becoming more overt.usual, then corruption involving If generates $4.5 billion you are a business entity that is now the prevailing term in the United States, word association from association football and Of the fourty-five national FIFA affiliates in which Canada, Ireland, Australia and New Zealand. three (Canada, Samoa and the United States) English is an official or primary language, only names, while the rest use football.” Fin. Action actually use soccer in their organizations’ official Task Force, Money Laundering Through the Football Sector, para. 12 n.1, (July 2009) [hereinaf- ter FATF]. of six confederations: Asian Football Confederation (AFC) in Asia and Australia; Conf ´ Carib- Africaine de Football (CAF) in Africa; Confederation of North, Central American and bean Association Football (CONCACAF) in North and Central America; Confederaci ´ Sudamericana de F ´ or- (OFC) in Oceania; and Union of European Football Associations (UEFA) in Europe. The ganization is also responsible for the issuance of regulations, including those governing financial rules that govern games played within the associations. onale de Football Association (FIFA). onale de Football 98 F under the umbrella of the gernaut that operates ´ \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 2 26-FEB-15 11:21 thought to have earned from the World Cup in Brazil from a single, thought to have earned from the scandals, documented instances of bribes, scandals, documented and worse—with in ille- of these crimes pouring billions the proceeds financial institutions of the world—reputablegal cash into the mul- conducting business regularly take on the risk of tinational companies with FIFA. exuberance (a pur- was the pageantry, emotion, and the smoke that the smolder- dollars spent by Brazil) had dissipated, ported $11 billion as an acute reminder that much of ing structure laid bare only served world is beset with corruption.the multinational sporting event The and the World Cup jugger- predicate crimes behind money laundering corruption to flourish.naut exemplify much of what allows Many reporters have written about sport commentators and investigative global football industry. Journalists the depth of corruption in the have provided comprehensive find- Declan Hill and Andrew Jennings and several major media out- ings from their investigative reporting, corruption at the highest levels lets have uncovered stories of of the World Cup, yet little appears involving FIFA and the awarding to improve year-after-year, Cup-to-Cup. 36088-swt_21-1 Sheet No. 52 Side B 02/26/2015 12:25:41 02/26/2015 B 52 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 53 Side A 02/26/2015 12:25:41 99 Polic- 7 IN THE WAKE OF BRAZIL 2014 IN THE WAKE note 2, para. 27. supra This article focuses largely on the football sector within the largely on the football sector This article focuses The Financial Action Task Force identifies several critical finan- The Financial Action Task Force Several important financial actors in the football industry can be Several important financial actors identified: the clubs (basic cell of the industry), football players (most valuable assets of the industry), corporate sponsors (in most levels most important investor), [the] media (especially powerful in top-league football), individual investors (club patrons), local busi- ness clubs or talent pools (investing in a club or in the acquisition of individual players), football agents (acting in the interest of the player or as an intermediary on the transfer market), (local) govern- ments (subsidising clubs, acting as a lender of the last resort, some- times owner of the stadium complex), tax authorities (in some cases a failing club will delay meeting its tax obligations in the hope of avoiding liquidation), real estate proprietors (stadiums are not al- 7. FATF, M K particularly the World Cup—andWorld the seemingly perpetual fog of cor- the particularly 2014] (and that revenue that occurs only every four years month-long event with few repercus- partly from corrupt practices was earned at least sions)—then believe that there is profit in perhaps there is reason to crime. A.Football Domination of the most dominant as it is not only one of greater sports industry, also one of the most and overall revenue, but it is sports in popularity it comes to media coverage of cor- prominent sports featured when ruption and money laundering allegations. is it about football— What ruption that swirls around it? the World Cup is the apogee Arguably, calendar, if only from the revenue event on football’s competition vantage. the size and scale of the greater professional To understand its scale: thirty-eight million reg- football sector under FIFA, consider and officials, and in excess of istered players, five million referees football alone. 300,000 clubs in professional/semi-professional \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 3 26-FEB-15 11:21 ing the activities and practices associated with forty-three million peo- ing the activities and practices associated most organized and well-funded of ple would overwhelm even the multilateral organizations—if such an agency existed. Add to this uni- public procurement (associ- verse related industries such as gambling; top level competitions); broadcasting/ ated with World Cup and other national level tendering to host not media (for access and rights); and prequel events, real estate, and mer- just the Cup, but its playoffs and too large for any one agency. chandising, rendering the scope cial pipelines associated with football: C Y 36088-swt_21-1 Sheet No. 53 Side A 02/26/2015 12:25:41 02/26/2015 A 53 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 53 Side B 02/26/2015 12:25:41 M K C Y [Vol. 21 RAZIL AS : B ORRUPTION C EGACY OF L S ’ UP C 8 “A” ORLD SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW para. 44. W Id. XHIBIT HE Why is it that anti-corruption crusaders and practitioners, prose- Why is it that anti-corruption crusaders This article sets out to understand the current state of football at out to understand the current state This article sets ways owned by the clubs or local government). In addition, associa- clubs or local government). In addition, ways owned by the operate act as regulators as well and sometimes tions or leagues can countries, for transfer payments. In some financial clearinghouses an influence large amounts of cash and have supporters provide as well the management and supplying businesses over club owners, organised of cases being allegedly linked with as, in a small number laundering corruption, tax evasion or money crime. If there is fraud, between the complex network of relations it takes place within these actors. E 8. cutors, civil society groups, and dedicated sports fans want to see a cutors, civil society groups, and only to consistently struggle in effect- clean and level industry appear, ing change in this specific industry? Is it that we lack sufficient mech- if current laws are sufficient, does it anisms by which to enforce; or, come down to a lack of consensus? political will? Whilst Is there no of corruption in the football industry much is written about the issues at FIFA, in many ways, the sports and many accusations are leveled other high-risk industries like the industry in general is not unlike sectors. Certainly most fans as well global extractives or construction and as local and national governments see football on a local scale, not as a megalith. the failure to recognize the magnitude of the Partly overall sports sector, including football, has hindered a cohesive effort toward building an effective set of rules, best practices, enforcement was tools, and compliance guidelines. This year’s World Cup in Brazil beset with what has now become standard to FIFA and to World Cups—ticket scandals; allegations of bribes; bags of cash given to players; an overall pall of greed, lax ethics, and doubt as to the integ- rity of the game; and an understanding that the entire production 100 addressing issues of corruption and a macro-level in the context of 2014.Cup post-World laundering money recent Cup Did this most any insights in how to better combat hosted in Brazil provide us with watched by over a billion people corruption in a sport played and around the world? I. T \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 4 26-FEB-15 11:21 36088-swt_21-1 Sheet No. 53 Side B 02/26/2015 12:25:41 02/26/2015 B 53 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 54 Side A 02/26/2015 12:25:41 , 10 101 World Cup [D.O.U.] de 6.6.2012 ˜ AO NI 9 (Sept. 19, 2014, 1:40 PM) U This special suspension of FICIAL DA ELEGRAPH 12 O , T Ghana Soccer Stars Await $3 Million Plane ´ ARIO I Undoubtedly, when the negotiations be- Undoubtedly, when the negotiations (Sept. 18, 2014) (U.K.), http://www.independent.co.uk/sport/ 13 (June 25, 2014), http://www.bloomberg.com/news/2014-06-25/ note 9. IN THE WAKE OF BRAZIL 2014 IN THE WAKE supra FIFA Is a Swamp of Greed—Sepp Blatter Claims to be Taking Lead on LOOMBERG NDEPENDENT Fifa Orders Officials to Return £1 Million Worth of Luxury Watches Given , I , B Under all normal circumstances, failing to declare such a Under all normal circumstances, 11 , Ekow Dontoh & Mario Sergio Lima, (July 7, 2014, 11:10 PM) (U.K.), http://www.telegraph.co.uk/sport/football/world- E.g. Many of FIFA’s executives and senior management came back executives and senior management Many of FIFA’s 9. 11. Rob Harris, 13. Dontoh & Lima, 12. Lei. No.12.663, de 5 de Junho de 2012, D 10. Oliver Brown, M K ELEGRAPH 2014: Ray Whelan, British Director of Fifa Hospitality Partner, Arrested in Ticket Touting Probe 2014: Ray Whelan, British Director of Fifa Hospitality Partner, Arrested in Ticket Touting T Ethics But Deserves Nothing But Strongest Ridicule ghana-sends-plane-with-3-million-to-calm-world-cup-team-1-.html; Ben Rumsby, ghana-sends-plane-with-3-million-to-calm-world-cup-team-1-.html; as World Cup Gifts (U.K.), http://www.telegraph.co.uk/sport/football/world-cup/11109065/Fifa-is-a-swamp-of-greed- Sepp-Blatter-claims-to-be-taking-lead-on-ethics-but-deserves-nothing-but-strongest-ridicule .html. (Braz.). Before Key Match football/news-and-comment/fifa-orders-officials-to-return-1million-worth-of-luxury-watches- given-as-world-cup-gifts-9741752.html. cup/10952715/World-Cup-2014-Ray-Whelan-British-director-of-Fifa-hospitality-partner-arres ted-in-ticket-touting-probe.html. Brazilian law explains how the Ghanaian team was able to fly in $3 Brazilian law explains how the managing to bypass Brazil’s laws on million in cash to pay its players, importation of currency. this request was framed as tween FIFA and Brazil were underway, in moving equipment and merchan- necessary to avoid costly delays dise in and out of the tournament. However, failures to abide by the and the exercise of obtaining most basic of laws in the host country protests of innocence when special privileges undermine FIFA’s charged with corrupt intent. FIFA claims to want to rid the sport of 2014] billions of dollars and whilst a host nation is bled of profited but a few obtain tickets to a single match. fans struggled to were not declared Brazil sporting luxury watches that from the Cup in by the English 2018 swag bags given to FIFA officials to customs. The Hublot watches. team included £16,000 ($30,000) World Cup bid in the greater seems like a minor transgression And while this perhaps context of setting a behavior, when viewed in the landscape of corrupt underscore that such behavior only serves to further tone at the top, levels of FIFA, is endorsed at the highest the culture of corruption at the manager, player, or refe- leaving little hope or space for reform ree level. not a In this instance, the gift of watches was technically violation. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 5 26-FEB-15 11:21 high value item would have likely triggered potential violations in two high value item would have likely countries. FIFA negotiated with the Brazilian government However, export during the lead-up to the Cup rights to unrestricted import and games. and through the duration of the C Y 36088-swt_21-1 Sheet No. 54 Side A 02/26/2015 12:25:41 02/26/2015 A 54 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 54 Side B 02/26/2015 12:25:41 M K 16 C Y GUARD- [Vol. 21 (July 2, ’ , —whose EWS 17 N OX , F Since 1994, Match has Infront’s chief executive 18 19 ]. Ticket Scalping Operation note 9. Brazilian Police Label Match Executive Ray Whelan a ‘Fugitive supra Among those arrested was Match executive Ray Whe- Among those arrested was Match 14 SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Brazil Police Arrests 11 in World Cup Ticket Scalping Operation Id. Id. Id. Match Services is the FIFA-contracted company responsible for Match Services is the FIFA-contracted No sooner had the 2014 tournament wrapped up than when sev- 2014 tournament wrapped up No sooner had the How does Match enjoy a relationship with FIFA?How does Match enjoy a relationship One of the 15 14. 19. 16. 17. 18. Owen Gibson, 15. Rumsby, (July 10, 2014, 4:56 PM) (U.K.), http://www.theguardian.com/football/2014/jul/10/ray-whe IAN 2014), http://www.foxnews.com/world/2014/07/02/brazil-police-arrests-11-in-world-cup-ticket- scalping-operation [hereinafter is Philippe Blatter, FIFA President Sepp Blatter’s nephew. Implicated the along with Match were officials from FIFA, as well as members of Match had been selling tickets to secondary ticketing companies, in- Match had been selling tickets to Nigerian company Pamodzi, and cluding India’s Reliance Industries, and Atlanta Sportif U.S.-based companies Jet Set Sports 102 to high ethical have its affiliated members adhere corruption and to by creating a mecha- undercuts its own arguments standards but then encourage gross violations. nism by which to A. Post-Brazil with FIFA and alleged corruption directly associated eral incidents of light.the Cup came to almost a stan- The first being what has become prize tickets and FIFA and Cups, having to do with dard scandal for matches.hospitality packages for the tournament In Brazil just after were arrested by Rio de Janeiro au- the final game, eleven individuals into the company Match thorities in connection with an investigation tickets and hospitality packages Services AG for their role in reselling at a profit. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 6 26-FEB-15 11:21 lan-match-fugitive. lan. organizing the tournament’s ticketing and “hospitality packages.” organizing the tournament’s ticketing been awarded a series of contracts to provide travel, IT services, ac- been awarded a series of contracts the Cup.commodations, and ticketing to In 2010 and again in 2014, rights to hospitality and accommo- Match was awarded the exclusive was serving as the direc- dation; Whelan, the Byrom’s brother-in-law, for ticketing, IT services, and tor of the Match subsidiary responsible accommodations. shareholder companies in Match is Infront. CEO was one of those arrested. Two brothers from Mexico, Jaime and CEO was one of those arrested. Two closely involved with FIFA since the Enrique Byrom, who have been Hospitality. 1986 World Cup, formed Match 36088-swt_21-1 Sheet No. 54 Side B 02/26/2015 12:25:41 02/26/2015 B 54 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 55 Side A 02/26/2015 12:25:41 UP — 103 C 21 ORLD Match was 20 —2018 W OMMITTEE C art. 24 (2014). PORT S RAZIL B that restricts the selling of tickets that restricts the UP 23 EDIA AND C note 14. note 14. , M ORLD supra supra , , ULTURE 26 , C IN THE WAKE OF BRAZIL 2014 IN THE WAKE It remains to be seen if U.S. regulators will open It remains to be seen if U.S. regulators 25 : 2014 FIFA W note 18. note 18. OMMONS but Brazilian law C 22 supra supra Prior to the Brazilian authorities’ enforcement action, Prior to the Brazilian authorities’ 24 OUSE OF EGULATIONS Ticket Scalping Operation Ticket Scalping Operation We were appalled by the allegations of corruption made against We were appalled by the allegations during the course of members of the FIFA Executive Committee challenged in other evidence, our inquiry. Although they have been to commission a full, urgent they are sufficiently serious for FIFA for the outcome to be made and independent investigation, and impression of wishing to public. Instead, FIFA has given every under the carpet and of dis- sweep all allegations of misconduct missing anyone bringing allegations to them with an approach bor- dering on contempt. 26. H 25. Gibson, 23. Lei. No.12.299, de 27 de Julho de 2010, D.O.U. de 28.7.2012 (Braz.). 24. 22. R 21. Gibson, 20. , 2011, H.C. 1031, at 3 (U.K.). M K ID rather than returning them to FIFA as required, violating not only them to FIFA as required, rather than returning FIFA had announced that Match would retain its exclusive contract FIFA had announced that Match 2022 Cup in Qatar), thought to be through 2023 (finishing out the worth $300 million. B an investigation into Jet Set Sports’ role in the conspiracy. an investigation into Jet Set Sports’ B. Bidding Scandal This was one of the opening statements in a report of the U.K. House bid of Commons Culture, Media and Sport Committee on England’s to host the 2018 World Cup. 2014] and Spanish football federations. Brazilian, Argentinian, \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 7 26-FEB-15 11:21 for sporting events above face value.for sporting events such a violation would Although prison sentence, in a fine equivalent to $225 and no typically result in criminal conspir- requested the judge charge this case the investigator in substantial prison laundering, which could result acy and money time for all accused. than three million tickets available Of the more 445,500. Match had been allocated for the 2014 Cup, However, all unsold or unused tickets be re- FIFA’s regulations require that them available to the public—includ-turned to FIFA in order to make national budget paid for the ing those Brazilian citizens whose stadiums used for the Cup. that the eleven arrestees It was disclosed involved with the organized scalping had confessed that they had been earning close to $91 million ring in four previous Cup tournaments, per Cup. FIFA’s rules reselling tickets and packages at a profit—totalingreselling tickets $100 million C Y 36088-swt_21-1 Sheet No. 55 Side A 02/26/2015 12:25:41 02/26/2015 A 55 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 55 Side B 02/26/2015 12:25:41 M K C Y pub- [Vol. 21 The funds 28 The Sunday Times article, but there has not been (June 1, 2014) (U.K.), http://www.thesunday IMES T Plot to Buy the World Cup: Huge Email Cache Reveals UNDAY , S The Sunday Times The bid-award corruption centers on Mohamed Bin The bid-award corruption centers 27 SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Id. Fahrenheit in the shade. the in Fahrenheit never The Qatari national team has The second allegation of corruption arrived at the commence- of corruption arrived at The second allegation The venality in awarding the hosting of the Cup to two nations The venality in awarding the hosting ° 28. 27. Jonathan Calvert & Heidi Blake, Secrets of Qatar’s Shock Victory Hammam, a Qatari and former FIFA Executive Committee member Hammam, a Qatari and former slush fund from which he paid who availed himself of a $5 million the 2022 Cup for Qatar. bribes and brokered deals to win times.co.uk/sto/news/uk_news/fifa/article1417325.ece. lished a series of articles stating that it was evident that agents for lished a series of articles stating facilitated the awarding of Qatar and possibly others had seemingly millions of dollars in bribes paid to the two Cups via hundreds of FIFA members. reached Cup playoffs, and the country offers little infrastructure to and the country offers little reached Cup playoffs, supporters, which would more than support an influx of fans and games. The football community was double its population during the was not until outraged by the selection, but it 104 egregious nature; go- Cup and was of an even more ment of the 2014 up the professional of the issue of how to clean ing to the heart the Cup. as it relates to hosting football sector, particularly deci- The and 2022 Cup to the award the 2018 Cup to Russia sion by FIFA to described as having of Qatar could reasonably be small Gulf state stunned nearly everyone. where summer tempera- Qatar is a country reach an excess of Cup tournament is held) frequently tures (when the 120 \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 8 26-FEB-15 11:21 or accounts of Bin Hamman, as a Qatari official and Politically Ex- or accounts of Bin Hamman, as triggered enhanced scrutiny by the posed Person (PEP), should have institutions where they were housed. does not However, as of yet this of investigators.appear to have caught the attention ques- the Why brought to light earlier will be dis- tionable transactions were not where systems already in place are cussed later, as it underscores failing. corrupt officials, lax or unen- known for their corrupt tax systems, forced money laundering laws, and absence of press freedom further re- damaged any credibility FIFA as an organization might still have their tained. Increasingly, large sporting organizations want to stage events in emerging economies—especially the larger or more robust ones.Why? more money, and more They attract bigger audiences, future fan potential. There have been calls for the disbandment of FIFA in the wake of enough discussion about the role that individual countries and spon- enough discussion about the role that individual countries and 36088-swt_21-1 Sheet No. 55 Side B 02/26/2015 12:25:41 02/26/2015 B 55 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 56 Side A 02/26/2015 12:25:41 105 Esquenazi note 2, paras. 79-84. supra wait for the FIFA-led cash gen- 29 IN THE WAKE OF BRAZIL 2014 IN THE WAKE Corruption in sports is not a new phenomenon. Every few years, is not a new phenomenon. Corruption in sports Companies pay millions to align their brands with football’s star Companies pay millions to align Increasingly, teams, venues, and events have a direct nexus to 29. For a background in betting on football matches, see FATF, M K hosted as it was by a country with the ethics of the Mafia—andhosted as it was by a country with where 2014] be crushed by cor- dictate whether the Cup is to sors play in helping fairly and transparently. ruption or operated C. Football and Corporations only to be dis- and match-fixing incidents surface doping scandals forgotten.cussed and then paid to scant attention has been However, get themselves in- that exist for companies that the corruption risks rights deals both providing services, or securing volved in sponsoring, and world sporting sports teams, leagues, with and for professional events. of state- The sheer amounts of money at stake, the likelihood and often the host country’s politics owned enterprise involvement, to companies is significantly ele- nearly always ensure that the risk vated. Olympics in Sochi were plagued by corruption— If the Winter three professional football matches is it is estimated that one in every subject to fixing by organized crime, \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 9 26-FEB-15 11:21 erating machine that is the 2018 World Cup to land in Russia.erating machine that is the 2018 As far had chronicled bribes paid by Rus- back as 2010, a major media outlet members. sian officials to FIFA committee events such as the Cup, but have not athletes, winning teams, or major role in sustaining the corruption been held fully accountable for their Corporations, with their sponsor- that has permeated into the sport. substantial power but have not ship dollars and brand names, wield extent to helping redress the dishon- yet exercised it toward any great esty that has taken hold of football. D. SOE’s and Companies state-owned enterprises (SOEs), ensuring that the corporate entities that get involved with them will encounter situations that demand from careful consideration when transacting with representatives those SOEs. it may not be readily apparent that the team or Oft times even co-sponsoring company may be an SOE. In many countries, it is a politician who heads the sports governing bodies rather than private business people. In doing deals with these bodies, the likelihood that gov- the transaction is with someone falling under the definition of a ernment official is extremely high. As the recent ruling in C Y 36088-swt_21-1 Sheet No. 56 Side A 02/26/2015 12:25:41 02/26/2015 A 56 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 56 Side B 02/26/2015 12:25:41 M K C Y (July Ulti- (Sep. 7, [Vol. 21 (June 2, 33 RO STATE EWS P E EAL PORTS TV N R , S APID , R (Aug. 15, 2010), http://soccer ELOITTE ENS , D L One of the other top three Qatar’s SWF, Qatar Holding OCCER 35 34 , S upon those listed companies involv- upon those listed 30 Volkswagen is both a sponsor of several Ger- Volkswagen is both a sponsor of and was a sponsor of the 2014 World Cup in and was a sponsor of the 2014 36 37 TV Sports Rights Agency Bypasses Qatar The World’s Biggest Soccer Sponsors The bigger surprise would be if there was no occurrence of would be if there was no occurrence The bigger surprise SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Infront represents more than 120 sports rights holders, in- Infront represents more than 120 As demonstrated by a recent case, their sponsorships have As demonstrated by a recent case, 31 32 38 Brazil 2014: A Group-by-Group Sponsorship Guide to the Teams Id. Id. Id. Deloitte: Qatar to Spend $200 Billion for World Cup Deloitte: Qatar to Spend $200 Billion for World It is estimated that Qatar will spend $200 billion on its World Cup Qatar will spend $200 billion on It is estimated that Only a couple of years ago, the sovereign wealth funds (SWF) of Only a couple of years ago, the sovereign 32. Rebecca Hawkes, 36. 37. Daryl, 33. 34. 35. Press Release, Qatar Holding LLC, Qatar Holding LLC Announces Major Investment 38. 30. 921-22 (11th Cir. 2014). United States v. Esquenazi, 752 F.3d 912, 31. 2014), http://www.sportspromedia.com/notes_and_insights/brazil_2014_a_group_by_group_spon sorship_guide_to_the_teams. 2013), http://www.deloitterealestate.co.uk/News/Deloitte-Real-Estate-/Deloitte-Qatar-to-invest- over-US-200-billion-in-c.aspx. in German Automotive Companies (Aug. 14, 2009), http://www.qatarholding.qa/Media%20Cen ter/Press%20Releases/14August2009/Pages/default.aspx. 2011), http://www.rapidtvnews.com/2011090714902/tv-sports-rights-agency-bypasses-qatar.html #axzz3GS4DpDLA. lens.com/the-worlds-biggest-soccer-sponsors/52174. LLC (QH), owns a significant share in Volkswagen AG (17%), mak- LLC (QH), owns a significant share ing them the third largest shareholder. 106 definition of “instru- least in the U.S. for now, the demonstrates, at mentality” is greatly expanded. the reach of the U.S. Foreign Thus, Act (FCPA) Corrupt Practices \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 10 should tread espe- SOEs as part of the World Cup ing themselves with 26-FEB-15cially carefully. 11:21 project. cluding seven national football federations, leagues, and clubs. cluding seven national football federations, significant corruption. is too opaque, the The money is too big, FIFA world’s opinion, and immune to the rest of the host nation is largely to truly investigate mechanism well-funded enough there is no global is still eight years away. and clean up the tournament that were bidding on the Swiss-based Qatar and Abu Dhabi, respectively, & Media (the same Infront led sporting rights agency, Infront Sports in the Match scandal discussed by Sepp Blatter’s nephew involved above). man football teams Brazil. shareholders in Volkswagen is Lower Saxony—theshareholders in Volkswagen is Lower German state gov- ernment—which a 20% blocking share. owns QH also holds a 10% share of Porsche SE. mately, the SWFs lost to Bridgepoint; had either SWF won, a foreign mately, the SWFs lost to Bridgepoint; government would wholly own Infront. 36088-swt_21-1 Sheet No. 56 Side B 02/26/2015 12:25:41 02/26/2015 B 56 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 57 Side A 02/26/2015 12:25:41 41 107 LOOM- PIEGEL ,B , S As an ex- Qatar’s bid 43 44 Speer is to design eight of the 45 Whilst not directly related to QH’s Whilst not directly 40 Auditors of the Brazilian Cup build- 46 Gulf Goals: Qatar Has High Hopes for 2022 World Cup IN THE WAKE OF BRAZIL 2014 IN THE WAKE VW, Garcia Sanz Face Compliance Probe in T-Systems Case Administrative charges are still pending resolution Administrative 16 million sponsorship of the German soccer club VfL of the German soccer 16 million sponsorship 39 Deutsche Bahn AG, the German national railway, has Deutsche Bahn AG, the German = 42 Id. Id. Id. Id. Id. (Dec. 15, 2010, 11:24 AM) (Ger.), http://www.spiegel.de/international/world/gulf-goals- (April 25, 2013 2:58 AM), http://www. bloomberg.com/news/2013-04-25/vw-garcia-sanz- In March 2011, the German construction company Hochtief an- In March 2011, the German construction 42. 43. Alexander Smoltczyk, 40. 41. Press Release, Qatar Holding to Become Major Shareholder of HOCHTIEF, HOCH- 44. 45. 46. 39. Karin Matussek, M K NLINE BERG TIEF Aktiengesellschaft (Dec. 6, 2010) (Ger.), http://www.hochtief.com/hochtief_en/pdfservice/ 8665. face-compliance-probe-in-t-systems-case.html. qatar-has-high-hopes-for-2022-world-cup-a-734610-2.html. Wolfsburg. O As a result of the investment, it became evident that Hochtief would As a result of the investment, it stadiums and the world’s longest be building most of the World Cup from Qatar to the island nation of link between countries, a bridge Bahrain. nine new stadiums in Qatar. If Brazil’s experience is indicative of the German companies, there is much forthcoming challenges to these cause for caution and concern. 2014] allegations of corruption.not been without 2011, German prosecu- In of Deutsche former employees and consultants tors charged three with several em- T-Systems subsidiary, along Telekom AG (DTE)’s to retaining Volk- AG, with bribery relating ployees of Volkswagen swagen’s C \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 11 26-FEB-15 11:21 against at least one member of Volkswagen’s management board for member of Volkswagen’s management against at least one the corruption. failing to prevent Doha’s new 320-kilometer metro been awarded the contract to build company will apparently supply system, and a southwestern German the World Cup stadiums. the air-conditioning systems for investment in Volkswagen, it focuses questions about the overall tone it focuses questions about investment in Volkswagen, or guided by its external relationships. that is being set approximately 10% of its shares. nounced the Qataris would acquire to make more money on the 2022 porting nation, Germany stands World Cup in 2006. World Cup than it did on its own (eleven pounds), was the work of book, weighing in at five kilograms Speer & Partners and two Ger- the Frankfurt architecture firm Albert man project development companies. C Y 36088-swt_21-1 Sheet No. 57 Side A 02/26/2015 12:25:41 02/26/2015 A 57 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 57 Side B 02/26/2015 12:25:41 , M K 47 C Y , N.Y. [Vol. 21 (May 11, 2014, TRAFGESETZBUCH S NLINE Western compa- See O ] 3322, as amended, §334. 53 I . AIL , M BGBL , [ Already—only months af- system who are working on 48 could direct its regulators to de- 52 In 2007, FIFA published estimates In 2007, FIFA published kafala 54 49 Bribery Case Will Cost Siemens $1.6 Billion UNDESGESETZBLATT Certainly, this recent experience should Certainly, this 51 The Hundreds of Migrant Workers Dying as a Brand New Qatar Is Built ], Nov. 13, 1998, B ODE C SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW (May 14, 2014, 10:58 AM) (U.K.), http://www.theguardian.com/world/2014/may/14/ ENAL The total costs approximate to $4.2 billion, more than four approximate to $4.2 billion, more The total costs Id. Id. Id. Id. High Cost, Corruption Claims Mar Brazil World Cup Germany, having been home to one of the largest corporate cor- Germany, having been home to , Dec. 16, 2008, at B8. 50 54. This could certainly trigger Germany’s penal code section 334. 48. 53. Owen Gibson, 47. 49. 50. 51. 52. Eric Lichtblau & Carter Dougherty, GB] [P T IMES migrant-workers-dying-qatar-world-cup. 11:13 PM), http://www.dailymail.co.uk/wires/ap/article-2625949/High-cost-corruption-claims- mar-Brazil-World-Cup.html. building stadiums and infrastructure for the Cup—withbuilding stadiums and infrastructure excess of in eight years of building to go—only270 workers already dead and still the supply chain. proves corruption’s prevalence in nies could lead by demanding higher standards, or perhaps it will be nies could lead by demanding higher in their home countries to pro- left to the prosecutors or shareholders to address their role in allowing mote the respective companies’ desire the corrupt practices to continue. GUARDIAN [S give pause to the German companies contracted to Qatar for 2022. give pause to the German companies ruption scandals in modern history, in the 2022 Cup operate at the mand that German companies involved transparency, which would in some highest standards of integrity and to those infrastructure projects they ways ensure (at least with respect traction.direct) corruption does not gain appear Already it would battle.that they are falling behind in this human-rights record Qatar’s disclosure of appalling conditions for is already atrocious: the recent slave laborers under the country’s 108 one stadium alone. $275 million in overcharges on ing projects found of the stadium’s it was estimated that one-third In a 140-page report, to overpricing. cost could be attributable deemed necessary the twelve stadiums in Brazil of costs on building $1 bil- stating the fees would be approximately for the Cup games, lion. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 12 26-FEB-15 11:21 times the initial estimate. times the initial T ter the tournament ended—Brazilianter the tournament that there authorities indicate into financial mal- separate federal investigations are at least a dozen to Cup spending. feasance related 36088-swt_21-1 Sheet No. 57 Side B 02/26/2015 12:25:41 02/26/2015 B 57 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 58 Side A 02/26/2015 12:25:41 56 109 , was (Sep. 17, REGONLIVE , O Nike had signed a ten-year 57 . (Jan. 16, 2011), http://www.middle-east-studies.net/ The Emerging World Champions The Emerging World stating, “Sponsorships and acquisitions stating, “Sponsorships TUD E. S (Apr. 24, 2012, 9:16 PM), http://www.oregonlive.com/playbooks- IN THE WAKE OF BRAZIL 2014 IN THE WAKE IDDLE Money Talks: Qatar’s FIFA World Cup Bid Fits Sovereign Wealth Nike Executive in China Gave Bribe to Chinese Soccer Official, News , M Nike Manager Detained in China Soccer Scandal 55 REGONLIVE , O Middle East Studies Opportunities for bribery to insert itself in companies’ transac- bribery to insert itself in companies’ Opportunities for a recent corruption investiga- As both the Volkswagen case and Javier Santiso, author of Javier Santiso, author 57. Allan Brettman, 56. Richard Read, 55. James M. Dorsey, M K Agency Reports 2010, 6:08 PM), http://www.oregonlive.com/business/index.ssf/2010/09/nike_manager_detained_ in_china.html. of clubs ‘not only improve the respective clubs’ finances, but could improve the respective clubs’ of clubs ‘not only companies in target for investing in national also whet their appetites markets. appear is that these football investments What is interesting other industrial or go hand-in-hand with, to effectively stimulate, investments.’” profits/index.ssf/2012/04/nike_executive_in_china_gave_b.html. archives/8127. Tong was ultimately prosecuted in China in 2013 for having paid Tong was ultimately prosecuted in China in 2013 for having $273,000 in bribes to the head of the Chinese Football Association, Xie “Nan” Yong, who was also arrested. 2014] E. Corruption Opportunities for quoted in myriad: ticket sales and distribution tions with the football sector are Match discussion above); sponsored of hospitality packages (see the a club owned by a municipality/town- players who may be attached to systems that supply international ship/SOE; corrupt procurement major events; teams and scouts matches; selling of votes for hosting to develop “special relation- working for teams investing millions trolling for promising young ships” and academies in other countries of those academies may involve players (where the establishment but seek corporate investment); joint, local government ownership infrastructure; marketing deals; host- awarding and building of sport officials affiliated with host nations ing and entertaining government clearances; media, television, and and FIFA; permits, visas, and other and allocating sponsor rights (includ- broadcast rights; and negotiating ing sponsorship fees). This is a mere summary of the countless oppor- tunities for bribery in football. the insidious spread of bribery asso- tion involving Nike demonstrates, largest of companies.ciated with football can harm the In 2010, Li Olympian serving as marketing Tong, a Chinese national and former of Nike Inc., was arrested as part director for Nike China, a subsidiary of an investigation into allegations of bribery and match-fixing. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 13 26-FEB-15 11:21 Fund Investment Strategy C Y 36088-swt_21-1 Sheet No. 58 Side A 02/26/2015 12:25:41 02/26/2015 A 58 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 58 Side B 02/26/2015 12:25:41 M K 62 61 C Y 59 [Vol. 21 Brazil Moves to Ease Soccer Beer Ban, as World Cup Spat With FIFA note 56. FIFA however, requires all host countries to sell alco- FIFA however, requires all host 60 supra SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Nike paid $15 million the first year to provide uniforms to the first year to provide Nike paid $15 million 58 Id. Id. Id. , NPR (Mar. 7, 2012, 3:21 PM), http://www.npr.org/blogs/thetwo-way/2012/03/07/1481551 What of the officials, whether they be at a local, mayoral, re- whether they be at a local, What of the officials, that they are being held account- Increasingly companies will find 61. 62. 58. Read, 59. 60. Bill Chappell, Grows 10/brazil-moves-to-ease-soccer-beer-ban-as-world-cup-spat-with-fifa-grows. Considering that one of FIFA’s largest sponsors is a global beer manu- Considering that one of FIFA’s largest seen as a coincidence, but the con- facturer, the negotiability could be fans and Brazilian citizens.nection is one easily seen by Brazil amended its law to accommodate FIFA and this particular sponsor. However, one has to ask if the decision was the best for the sponsor. Host countries should stand their ground, but corporations are finding that they too must seek to exemplify good corporate social responsi- bility, not just in decrying labor abuses in the building of stadiums, 110 beating out rival with the Super League in 2009, sponsorship deal Adidas. recipients of team, or state level when they are the gional, provincial, the form of free tick- organizational largesse in association, or larger etc.? events, hospitality packages, ets, entry to special some Whilst have rules or regula- national and local levels may countries at both gifts over a certain public officials from receiving tions precluding apply to tickets for high-profile value, such regulations do not always of VIPs might be expected.sporting events where the presence None- like by teams can result in advan- theless, the giving of tickets or the tages to the team. Quid pro quo can be subtle. Did the team enjoy the team’s deal with the city or state subsequent tax advantages when those same-hosted officials?came up for renewal in front of Were offered for upgrades to a local there government (taxpayer) subsidies stadium? they sponsor, the stadiums they able for the behavior of the players and the behaviors they tolerate pay for, the investment they make, within the sector. After more than forty alcohol-related deaths oc- in a nine-year period (1999-2008) in curred during football matches of alcohol inside all football stadi- Brazil, the country banned the sale ums in 2003. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 14 26-FEB-15 11:21 hol during the Cup, and claimed it was “non-negotiable” with Brazil. hol during the Cup, and claimed the league’s sixteen teams and was given an annual 10% price in- teams and was given an annual the league’s sixteen $200 million. deal ultimately worth more than crease, making the 36088-swt_21-1 Sheet No. 58 Side B 02/26/2015 12:25:41 02/26/2015 B 58 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 59 Side A 02/26/2015 12:25:41 66 111 ANGUAGE L VISA, 65 LOBAL , G and other sponsors have all come out and other sponsors have all come 69 Nearly 10% of all the FIFA partners and Nearly 10% of all the FIFA partners 63 IN THE WAKE OF BRAZIL 2014 IN THE WAKE GLM used a Brand Affiliation Index (BAI) to GLM used a Brand Affiliation 64 Coca-Cola, EPUTATIONS 68 R Adidas, (June 13, 2014), http://www.languagemonitor.com/global-english/fifa-corruption-and- Id. Id. Id. Id. Id. Id. FIFA Corruption Scandal Impacts World Cup Marketing Partners PONSOR 67 The Internet data analysis group, Global Language Monitor The Internet data analysis group, As much as we abjure to see FIFA select a country with a repres- to see FIFA select a country As much as we abjure Companies should not wait for prosecutors in the U.S., UK, 64. 65. 66. 67. 68. 69. 63. M K ONITOR scandal-impacting-world-cup-2014-partners-and-sponsors. M Sony, (GLM), conducted an analysis of the Qatar bid for the 2022 World (GLM), conducted an analysis of “disarray,” and the 2014 FIFA Cup using terms such as “corruption,” determine the association of corrup- sponsors and partner names to tion with these companies. 2014] to be affiliated for bribes, but even in refusing eschewing all requests tarnish their brands. with practices that as a future World record or inadequate rule of law sive human rights amendment of a is it undesirous to see the forced Cup host, so too accommodate a sponsor.country’s laws to gen- not does sponsor The host) country is un- and the host (or potential erate positive publicity, dermined for ceding law for profit. of The perception of the integrity yet another blow. the game suffers II. S corruption scandal and the brand. measure the linkage between the the likes of VISA, Adidas, Several major global brands, including Hyundai-Kia, had significant rank- Coca-Cola, Sony, Budweiser, and when an online search was made of ings on the BAI, meaning that scandal were often some of the each brand, links to the corruption first associations made. the value of your sponsorship to Try selling with that finding. your board or activist shareholders \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 15 26-FEB-15 11:21 sponsors hits had results that affiliated them with corruption based in sponsors hits had results that affiliated the Qatari scandal. calling for an investigation with strong statements of condemnation, as seeking to reaffirm their corpo- into the 2022 Cup scandal, as well rate values. China, Brazil, Germany, Canada, Colombia, Australia, etc., to launch un- investigations under their respective laws. Nor should brands wait til the point where fans turn away from them in disgust, following C Y 36088-swt_21-1 Sheet No. 59 Side A 02/26/2015 12:25:41 02/26/2015 A 59 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 59 Side B 02/26/2015 12:25:41 , M K C Y LOWS The [Vol. 21 F 73 LLICIT , I LIGHT NTENSIVE F -I ASH APITAL C : C RAZIL , B NTEGRITY OOTBALL AS A I In the 2010-2011 timeframe—in the lead : F 71 From 2003-2009, the outflows show minor From 2003-2009, the outflows , 1960-2012, at 1 (2014). INANCIAL REEN 70 F G RISES C note 2, para. 23. LOBAL 72 , G supra AR K SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW EV USINESS LAYING THE Id. Id. B ACROECONOMIC According to a Financial Action Task Force (FATF) survey, sev- According to a Financial Action The non-profit transparency group, Global Financial Integrity, re- The non-profit transparency group, M 71. 70. D 72. 73. FATF, up to the county’s hosting of the Cup—outflowsup to the county’s hosting of the to over $30 jumped billion a year. AND eral sports are particularly identified as being vulnerable to money eral sports are particularly identified racing; motorcycle racing; car racing; laundering: cricket; rugby; horse ice hockey; basketball; volleyball; and particularly, football. cently issued a report on illicit financial outflows from Brazil, tracking cently issued a report on illicit financial data from 2002-2011. the $20 billion mark, remarkable and growth but hover largely around to what happened once the World lamentable, but nothing compared Cup came to the country. 112 by civil society groups.naming and shaming should de- Rather, they or withdraw their support.mand transparency enforce- In this new regime and a more stringent global anti-corruption ment era that sees that encompass social responsibility reporting rules new corporate corruption, fraud, and other factors—corporationsanti-trafficking, of the problem.need to get in front corporations with Multinational borders and may carry clout that crosses global brand awareness ethical behavior, effective in forcing transparency, prove to be highly in sporting institutions.and good governance Such clout may also target on their back, otherwise might prove to be a help reduce what hold the quiver of arrows.as prosecutors in multiple jurisdictions It is investing $25-$100 million in spon- not the time to discover that, after by proximity, or worse by involve- sorship, the company is associated an event such as the World ment, in a corruption scandal featuring Cup. III. P \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 16 26-FEB-15 11:21 vulnerabilities associated with football exist in part because of the vulnerabilities associated with football exist in part because of high value involved in the transfer of players, the size of the overall sector, the use of cash at the club’s mid-levels, the amount of procure- ment and facilities associated with the sport, and the cache of owning a team. On occasion (and in passing), reports of corruption in football out make mention of money laundering charges or issues of accounts 36088-swt_21-1 Sheet No. 59 Side B 02/26/2015 12:25:41 02/26/2015 B 59 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 60 Side A 02/26/2015 12:25:41 , 75 113 ELE- The , T 76 In 2012, 79 (Dec. 22, 2011) (In- Brazil’s initial 82 and FIFA’s Execu- 80 PORTSKEEDA A second official impli- , S 77 Teixeira received $9.5 million 74 (Nov. 29, 2010, 8:59 PM) (U.K.), http://www. ELEGRAPH , T (Dec. 4, 2011, 10:10PM) (U.K.), http://www.telegraph.co.uk/ IN THE WAKE OF BRAZIL 2014 IN THE WAKE Daughter of World Cup Official Had £2m Put into Account note 76. Football is Beautiful; FIFA Is Not While Brazil continues to investigate, Teixeira has While Brazil continues to investigate, Scandal Overshadows FIFA Executive Committee as World Cup Votes Scandal Overshadows FIFA Executive Committee ELEGRAPH Fifa Corruption Intrigue Deepens as Brazil’s Ricardo Teixeira Resigns supra 81 Former Fifa President Joao Havelange Resigns from the International World Cup 2018: David Cameron Tries to Limit Damage to England’s Bid World Cup 2018: David Cameron Tries to Limit , T (Mar. 12, 2012, 5:31 PM) (U.K.), http://www.theguardian.com/football/2012/mar/12/ . Id Id. Havelange reportedly received in excess of $50 million in Havelange reportedly received (Apr. 18, 2014, 8:00 PM) (U.K.), http://www.telegraph.co.uk/sport/football/world-cup/ Several recent cases raise compelling questions as to how the raise compelling questions Several recent cases , DW (Feb. 12, 2010), http://www.dw.de/scandal-overshadows-fifa-executive-committee-as- 78 80. David Conn, 76. Claire Newell et al., 82. 78. 79. Mario Rodrigues, 81. Newell et al., 75. Matt Hermann, 74. Paul Kelso, 77. Paul Kelso, M K Loom world-cup-votes-loom/a-6287381. GRAPH sport/olympics/8934668/Former-Fifa-president-Joao-Havelange-resigns-from-the-International- Olympic-Committee.html. dia), http://www.sportskeeda.com/football/football-is-beautiful-fifa-is-not. fifa-ricardo-teixeira-resigns. telegraph.co.uk/sport/football/teams/england/8169268/World-Cup-2018-David-Cameron-tries-to- limit-damage-to-Englands-bid-following-Panorama-investigation.html. Following Panorama Investigation GUARDIAN Subsequent investigation by FIFA’s own Ethics Committee found that Subsequent investigation by FIFA’s had more than £2 million depos- Teixeira’s then-ten year old daughter in her name in Rio de Janeiro. ited into a bank account set up 2014] discussion is exerted bribes have been paid; but little of which, or into, laundering is to intertwined and even central money upon how deeply of the football sector’s corruption. the skullduggery allowed to occur.laundering was the most public cases fea- One of Football Con- the now-former head of Brazil’s tures Ricardo Teixeira, committee for and member of FIFA’s organizing federation (CBF) the 2014 Cup.Cup in Brazil, an investigative In the lead up to the which outlined identified confidential documents report by the BBC made by a sports payments, totaling $100 million, over 175 separate marketing firm contracted by FIFA. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 17 26-FEB-15 11:21 bribes via a shell company also domiciled in Liechtenstein. bribes via a shell company also domiciled 10775490/Daughter-of-World-Cup-official-had-2m-put-into-account.html. relocated to the U.S. and now resides in Miami. relocated to the U.S. and now Olympic Committee cated in the scandal was Joao Havelange, Teixeira’s former father-in- cated in the scandal was Joao Havelange, law. BBC went on to later report that Teixeira, in an out-of-court settle- BBC went on to later report that million. ment, was required to repay $6.1 from these payments via a shell company domiciled in Liechtenstein. from these payments via a shell company Teixeira was forced to resign from both the CBF Teixeira was forced to resign from tive Committee. C Y 36088-swt_21-1 Sheet No. 60 Side A 02/26/2015 12:25:41 02/26/2015 A 60 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 60 Side B 02/26/2015 12:25:41 M K C Y [Vol. 21 GUARDIAN , , BBC (May . Additionally, the Id Id. , BBC (Sept. 7, 2014, to the law that criminalized to the law that 83 Scolari, who had led winning teams in multiple Scolari, who had led winning teams Scolari allegedly used a network of companies in Scolari allegedly used a network 85 86 Fifa Member Asked for Corruption Claims Explanation : SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Pele Son Edinho Sentenced to 33 Years in Brazil for Money Laundering post-2014 Cup, but these pale in comparison to the Qatar and post-2014 Cup, but these pale in Id. Luiz Felipe Scolari Under Investigation in Portugal for Suspected Tax Fraud 84 Several other cases involving FIFA and Cup personnel have sur- Several other cases involving FIFA 86. 83. Lei No. 12.683, de 9 de Julho de 2012, D.O.U. de 10.7.2012 (Braz.). 84. Only months after the conclusion of the 2014 Cup in Brazil, Canover Watson, a member 85. 12:44 PM), http://www.bbc.com/sport/0/football/29099696. However, the charges related not to 12:44 PM), http://www.bbc.com/sport/0/football/29099696. However, the charges related the Cup but to when Watson ran the Cayman’s Health Service Authority. (May 14, 2014, 12:12 PM) (U.K.), http://www.theguardian.com/football/2014/may/14/luiz-felipe- scolari-portugal-tax-fraud. 114 conducted where laws only applied to laundering money laundering used to fund criminal be demonstrated to have been the money could enterprises. The July 2012 amendment funds is concealed in which the source of the all monetary transactions is not retroactive. Brazilian these factors may challenge Presumably, laundering in that to convict Teixeira of money prosecutors hoping the overwhelming evidence.jurisdiction despite However, it does not in other jurisdictions—includinganswer why authorities that those the transfers occur- financial institutions that cleared play host to the the U.S.—failed such as Spain, the UK, and ring outside of Brazil, to Anti-Money Laundering (AML) enforce the much more stringent laws that exist in their books.Nor does it explain why the U.S. al- boundaries after his forced resigna- lowed Teixeira to move within its on evidence of his acceptance of tion from FIFA was predicated bribes and laundering—all findings by FIFA’s ethics committee. A. Laundering and the Cup faced \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 18 26-FEB-15 11:21 of FIFA’s own audit and compliance committee and vice-president of the Caribbean Football Union, was arrested in the Cayman Islands on charges of money laundering and corruption. Canover Watson 31, 2014, 19:27), http:// www.bbc.com/news/world-latin-america-27652832. There was no direct 31, 2014, 19:27), http:// www.bbc.com/news/world-latin-america-27652832. There was no connection to the Cup made beyond Nascimento’s role as Santos’ coach. Russia Cup bidding process, the Teixeira matter, and that of Luiz Fe- Russia Cup bidding process, the lipe Scolari. prior to the commencement of the Cup in Bra- A month of the Brazilian team, and now- zil, it was disclosed that the coach team, was under criminal in- former head of the Portuguese national for suspected tax fraud and vestigation by Portuguese authorities money laundering. coach of Brazilian team Santos and son of former football legend Pel ´e, Edson Cholbi do Nasci- coach of Brazilian team Santos and son of former football legend Pel ´e, for a mento, was arrested on the eve of the tournament and charged with laundering proceeds drug gang. countries over twenty-plus years, according to prosecutors held nu- countries over twenty-plus years, institutions in Miami, as well as via merous bank accounts at financial several companies. 36088-swt_21-1 Sheet No. 60 Side B 02/26/2015 12:25:41 02/26/2015 B 60 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 61 Side A 02/26/2015 12:25:41 115 Al- 89 7.4 mil- = FinCEN, at 91 It is alleged that Scolari availed him- It is alleged that 88 it remains unclear why Scolari was able it remains unclear why Scolari 90 IN THE WAKE OF BRAZIL 2014 IN THE WAKE Financial Crimes Enforcement Network, 31 C.F.R. §§ 1000-99 (2014) 92 Also according to prosecutors, the money went to ac- to prosecutors, the money went Also according 87 Id. Id. Id. Id. Id. See generally Analyzing the AML laws of just a handful of countries known for Analyzing the AML laws of just 92. 87. 88. 89. 90. 91. M K (granting FinCEN investigative authority over financial institutions, such as banks, money ser- (granting FinCEN investigative authority over financial institutions, such as banks, money vices, mutual funds, and securities dealers and brokers, but not over sporting events). lion in undeclared income from Portugal to U.S. accounts over a six- income from Portugal to U.S. lion in undeclared year period. B. AML Laws and Football its populations, it is evident that in the popularity of football among this respect the U.S. is behind many. Individuals in Colombia are sub- (Art. ject to the general provisions of the Colombian Criminal Code 323), which establishes the following: Colombian regulations pertain- ing to money laundering and terrorism financing include mandatory and reporting, not only by the usual industries like the financial sector 2014] to transfer the UK, and the Virgin Islands the Netherlands, C shell companies with U.S. finan- to so readily open accounts for these suspicion, and why those institu- cial institutions without triggering tions are not also under investigation. This can only partly be due to a Intelligence Unit (FinCEN), as gross oversight by the U.S. Financial sports clubs or the sport sector as the U.S. still has not referenced should be subject to enhanced being a risk industry whose participants financial institutions. due diligence procedures by U.S. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 19 26-FEB-15 11:21 counts held by the Netherlands-based Flamboyant Sports, London- the Netherlands-based Flamboyant counts held by Financial Corp., a Investors Limited, and Taliston based Chaterella company. British Virgin Islands present, makes mention only of sport in relation to the betting and present, makes mention only of a significant gap that allows the online gambling industries, leaving of funds from corruption in the U.S. to play host to the laundering football sector. self of these companies and bank accounts to avoid paying taxes on and bank accounts to avoid self of these companies his substantial income. salary of a reports state, “To help pay the New coach—andCup-winning poached to prevent him from being World contracts, including countries which offered him by other clubs and England—the spon- Portuguese federation signed multimillion-dollar and two Portuguese banks.” sorship deals, including with Nike though it is reported that the U.S. Justice Department is now assisting though it is reported that the U.S. the Portuguese authorities, C Y 36088-swt_21-1 Sheet No. 61 Side A 02/26/2015 12:25:41 02/26/2015 A 61 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 61 Side B 02/26/2015 12:25:41 , M K C Y INAN- This FFAIRS F [Vol. 21 Those A 96 In many 97 EVELOPMENT 98 NTERNATIONAL D I AKING NFORCEMENT AUNDERING AND E OWN ON ., M L AW D TR Their rules require the Their rules require ONEY . C & L ES 95 : M LAMPING R C EPORT ARCOTICS on 32/2012 [Financial Information Unit Res. N R L [D.O.] (Colom.); L. 3160, septiembre 1, 2011, ’ NT ORRUPTION I UK (2011). -C F FICIAL PPROACH TO O TRATEGY NTI O A S S ID’ IARIO UREAU F Although Turkey’s anti-money laundering Although Turkey’s , U4 A 93 ,B ONTROL : D on Financiera Resoluci ´ C 94 TATE OME AUNDERING IN THE ONTANA S H L F TOF ’ ARCOTICS EP ONEY N art. 34. ORK AT M 172-73 (2012). SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW W arts. 12-13. art. 11. LESSANDRA See id. Id. Id. intended to strengthen the capacity of these institutions to work intended to strengthen the capacity RIMES In 2012, Argentina’s Financial Information Unit published its reg- Financial Information Unit published In 2012, Argentina’s A model that could be emulated and improved upon would be A model that could be emulated 99 C 99. A 94. 2 U.S. D 98. 95. Unidad de Informaci ´ 97. 93. L. 1445, mayo 12, 2011, D 96. SSISTANCE RIBERY AND NTERNATIONAL CIAL I D.O. (Colom.). A B 116 and betting industry house, but also by the gaming currency exchange clubs. and by football an organization that to pressure from the FATF, ulations in response worldwide laundering guidelines to governments provides anti-money began targeting football. and which recently \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 20 26-FEB-15 11:21 32/2012] art. 11 (2012) (Arg.). more systematically on corruption outside the UK but directed via more systematically on corruption brib- targeting of UK companies or individuals implicated in foreign Argentine Football Association and every club in the top two divi- Association and every club Argentine Football on the payroll who makes at sions to file reports not only on everyone but also any outside income—in-least 60,000 pesos ($13,800) a year, media or image rights deals; and cluding bonuses; prize monies; loans; in-kind payments—asas everyone they do business with. well laws require the filing of Suspicious Transaction Reports by sports filing of Suspicious Transaction laws require the is no required due Your Customer obligations, there clubs and Know diligence for PEPs. league officials; players; owners; rule extends to their family members; sponsors; media figures; investors in league and club staff; corporate and government officials. players and team property; agents; who fail to comply could be fined up to 100,000 pesos ($23,000) or ten who fail to comply could be fined whichever is greater. times the amount of money involved, other jurisdiction should adopt if respects, it is the model that every to be successfully combatted. money laundering in the sport is ago in the UK, funded by the UK the program launched several years (DfID), to increase inves- Department for International Development senior political figures in the UK. tigations of money laundered by effort by the City of London Po- The DfID-funded program is a joint Service, and Crown Prosecution Ser- lice, London Metropolitan Police vice 36088-swt_21-1 Sheet No. 61 Side B 02/26/2015 12:25:41 02/26/2015 B 61 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 62 Side A 02/26/2015 12:25:41 117 103 102 The guidance sought 100 These activities include accepting Id. It also set forth those regulations under the It also set forth those regulations 101 IN THE WAKE OF BRAZIL 2014 IN THE WAKE note 2, para. 124. The UEFA also urged Mutual Evaluation Programme’s The UEFA also urged Mutual Evaluation Id. supra 104 para. 118. para. 126. At a preventive level, even though clubs are not directly subject to AML Id. Id. Id. Id. Id. 105 Other countries have also made their own small efforts toward Other countries have also made The Union of European Football Associations (UEFA) over the The Union of European Football In December 2007, the English Football Association came up the English Football Association In December 2007, 104. 105. 103. 100. FATF, 101. 102. M K 15,000 or more. C = deposits, dealing in investments, and dealing in goods of any description (including, e.g., player deposits, dealing in investments, and dealing in goods of any description (including, e.g., of transactions) by way of business whenever a transaction involves accepting total payments legislation, some club activities fall within the scope of the law, which applies to “relevant busi- legislation, some club activities fall within the scope of the law, which applies to “relevant others nesses” defined in the Regulations, such as accountants, banks and solicitors, as well as that carry out activities that clubs may be involved with. (MEP) from the European Parliament, known as the “Friends of (MEP) from the European Parliament, suspicious investments in the Football,” to ask the FATF to examine sport. sports sector, and in launching combatting laundering in the greater in financial transaction as- initiatives to prompt greater transparency sociated particularly with football. Italy has a commission dedicated past decade has issued explicit concerns regarding the football sector past decade has issued explicit concerns for money laundering. as a direct conduit by criminal organizations Union to investigate the ori- In 2005, the UEFA asked the European pounds coming into football due to gins of hundreds of millions of be using clubs as a vehicle for money growing fears that criminals may laundering. 2014] and build- Police unit focuses on investigating ery. The Metropolitan’s foreign PEPs in the for illicit money laundered by ing prosecutions officials of interna- be expanded to include senior UK, but this could countries adopted such as FIFA. If more tional sports organizations to systemic and funded such units, the disruption this approach and and the Cup might be that plagues football, FIFA, endemic corruption affected. guidance for football clubs. with an extensive \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 21 26-FEB-15 11:21 applicable to sports clubs. UK AML laws that were directly to provide clubs with an overview of the main UK legislation concern- with an overview of the main UK to provide clubs of crime on legislation; to set ing money laundering and the proceeds event of a suspicious transaction; out steps a club might take in the measures that clubs might take and to summarize some preventative to protect themselves. C Y 36088-swt_21-1 Sheet No. 62 Side A 02/26/2015 12:25:41 02/26/2015 A 62 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 62 Side B 02/26/2015 12:25:41 , M K EG- 106 C Y [Vol. 21 (DNCG) [R ESTION G ] art. 11 (Ligue de Football ˆ OLE DE ONTROL C ONTR C F.I.G.C.] art. 36 (Federazione Italiana Giuoco ANAGEMENT M ATIONALE DU N TATUTE OF FIFA Should Be Included in Swiss Money Laundering Laws IRECTION OF IRECTION D D F.I.G.C. [S ELLA ATIONAL D N SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW (May 28, 2014, 8:59AM), http://www.bloomberg.com/news/2014-05-28/fifa-said-to- Notably in Switzerland, the country’s parliament is currently the country’s parliament Notably in Switzerland, And in Brazil, there is a group, albeit in a voluntary manner, is a group, albeit in a voluntary And in Brazil, there ` EGLEMENT DE LA TATUTO 109 107 108 In many jurisdictions, money-laundering laws exist, as do Pro- In many jurisdictions, money-laundering obligations of money launder- Some countries mention reporting 108. de 1998, D.O.U. de 4.3.1998 (Braz.). Lei No. 9.613, de 3 de Mar¸co 109. Jan Schwalbe et. al., 107. R 106. S LOOMBERG ULATIONS OF THE B Professionnel 2010) (Fr.). Calcio 2014) (It.). that brings together representatives from football clubs, the country’s representatives from football that brings together bank, and the Unit (FIU), police, the central Financial Intelligence issues and con- problems and advise on financial judiciary to address cerns. be-included-in-swiss-money-laundering-laws.html. ceeds of Crime (PoC) acts.(PoC) Crime of ceeds gaps, as these But there clearly exist large specifically cover officials from inter- laws have not been extended to sports clubs, or to identify as high- national sports organizations and procedures around transac- risk or require enhanced due diligence coaches, referees, managers, and tions involving professional players, team owners. but a few instances, there exist few ing to the national FIUs, but in all there is to be a concerted effort to obligations for football clubs. If in the professional football sector, combat laundering and corruption organizations to its list of FATF must add FIFA and sports-related to exercise enhanced due dili- high-risk entities that require banks profile.gence on customers fitting this Cash payments to players failing to scrutinize transac- should be banned; financial institutions current account holders obligated to tions by FIFA vendors penalized; sport; and FinCEN and other Finan- disclose their affiliations with the cial FIUs’ watchdogs clarify that this a high-risk industry and recom- mend look-backs on the risky groups or organizations.money The involved in many of these corrupt transactions runs through either London or New York where clearing institutions are located.Thus, 118 football clubs. financial control in professional to monitoring of finances in body that provides oversight France hosts a voluntary only the sol- and amateur sports clubs, but examines all professional not the source of the or investors of the clubs and vency of the clubs funds. laws to include the country’s money laundering debating expanding International Olympic Committee sports officials from FIFA and the (IOC). \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 22 26-FEB-15 11:21 36088-swt_21-1 Sheet No. 62 Side B 02/26/2015 12:25:41 02/26/2015 B 62 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 63 Side A 02/26/2015 12:25:41 119 LAY IVILE ,P C ODICE . 105-43 (1998). O . N [CC], C OC “Public international D 112 110 which imposes very few REATY 111 CODE CIVIL ], GB ORRUPTION C [Z IVILGESETZBUCH IN THE WAKE OF BRAZIL 2014 IN THE WAKE Switzerland Prepares Stricter Laws Against Sports Corruption Z DDRESSING THE : A ] Dec. 10, 1907, SR 210, art. 52 (Switz.). OUT - ODE (Jul. 11, 2014) (Den.), http://www.playthegame.org/news/news-articles/2014/switzer C CHWEIZERISCHES IME IVIL AME In the wake of the 2014 Brazil World Cup, some long-time sports 2014 Brazil World Cup, some In the wake of the G 112. Arnout Geeraert, 110. 15 U.S.C. §78dd-1 (2012); Convention on Combating Bribery of Foreign Public Officials 111. S M K land-prepares-stricter-laws-against-sports-corruption. THE legally binding obligations.exceptions, such organi- Because of these for the purposes of money laun- zations can more readily be exploited or worse, by their own dering; are viewed with skepticism, to political manipulation by constituencies; and are more susceptible obvi- corrupt government officials from member countries. The most the ous solution is for the Swiss to amend their laws, and in July 2014, Un- Swiss Parliament opened debate on amending both the country’s fair Competition Act and the Swiss Criminal Code that would include making private corruption a criminal offense. [CC][C 2014] hope to ‘get clean’ is which the Cup and sport can the only means by begin enforcement as the true criminal conduits and to identify them facilitate their transactions.against those who young ambitious an For into the use of to make his name, investigating prosecutor looking of corruption pro- to launder the proceeds U.S. financial institutions vides ample opportunity. III. T the end of an era.bloggers and commentators bemoaned appe- The to be played in Russia and Qatar, tite for the next two tournaments and the revulsion at so many in- under their cloud of corrupt bids in this particular sport and stances of waste, abuse, and corruption as FIFA, may portend the end of around specific organizations such the Cup as we know it. What is to be done?on Convention The the FCPA specifically cover bribes Combating Bribery (OECD) and under which members of paid to “public international organizations” the IOC fall. sports-sanctioning bodies such as \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 23 26-FEB-15 11:21 in International Business Transactions, Dec. 17, 1997, S. T organizations” are covered under the FCPA, OECD Convention, and organizations” are covered under sports associations such as FIFA the UK Anti-Bribery Act, and yet, not businesses but associations and and the IOC, under Swiss law, are Swiss anti-corruption legal frame- therefore exempt from the current paying taxes in that country—Swiss-work and are not even subject to non-profit organizations and based sports associations are deemed Code, thus subject only to the Swiss Civil C Y 36088-swt_21-1 Sheet No. 63 Side A 02/26/2015 12:25:41 02/26/2015 A 63 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 63 Side B 02/26/2015 12:25:41 M K C Y [Vol. 21 Meca- The EU has 116 having rejected 118 , http://www.fbi.gov/about-us/ , SEC (2007) 935 (July 11, 2007). (via its Coalition of Major Pro- NVESTIGATION I 115 UREAU OF . B , http://www.interpol.int/Crime-areas /Integrity-in-Sport/In ED , F NTERPOL but it remains to be seen if in light of the but it remains to be seen if in light , I decision by the European Court, 117 Australia has proposed national legislation to combat Australia has proposed national the efforts are largely targeted toward match manipu- the efforts are largely 114 113 SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW Integrity in Sport Commission Staff Working Document–The and Context— EU and Sport: Background Sports Bribery Program Corruption (and within it, the related issues of match-fixing) re- within it, the related issues of Corruption (and What is the solution? Blatter There have been proposals to force 115. Submission to the Department of Broadband, Commc’ns & the Digital Econ., Review 116. 113. 114. 117. 13th Council of Eur. Conference of Ministers Responsible for Sport, Adopted Resolu- 118. Case C-519/04, Meca-Medina v. Comm’n, 2006 E.C.R. I-6991. Accompanying Document to the White Paper on Sport 120 and integrity of significant threat to both the future mains the most football. with INTERPOL to help Although FIFA recently partnered reject and report key stakeholders to “recognize, train and educate corruption,” larger issues of cor- adequately begin to address the lation and do not fraud that attend the laundering, bid-rigging, and rupt officials, money Cups.World (FBI) has a Federal Bureau of Investigation The U.S. section, but it largely as part of its organized crime sports bribery unit associated with ille- in college sports and crimes investigates gambling gal wagering. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 24 26-FEB-15 11:21 tegrity-in-sport (last visited Oct. 15, 2014). investigate/organizedcrime/sports_bribe (last visited Oct. 15, 2014). of the Interactive Gambling Act 2001, Coal. of Major Prof’l & Participation Sports, http://www. compps.com.au/submissions/COMPPS-2011-10-Interactive-Gambling-Act.pdf. gambling-linked corruption in sport tions, at 2, MSL13 (2014) 10rev (Sept. 18, 2014). taken some steps, Medina & Majcen fessional and Participation Sports [COMPPS] Association, which rep- fessional and Participation Sports cricket, Australian rules football, resents the national bodies of rugby, again this is a limited-in-scope effort. soccer, tennis, and netball), but Commission—whileEuropean The acknowledging there have been sector and that there are EU instru- reports of corruption in the sports States to criminalize offences of ments in place which require Member corruption—has been come to the conclusion that “[i]t has so far not EU mechanisms.” possible to tackle this issue through the “sports exception,” if good governance principles move out of the the “sports exception,” if good governance “self-regulation” and further fall responsibility of sports associations’ into compliance with EU laws. suggestions of boycotts against the and his senior team to resign, down the entire organization Qatar World Cup, and of even shutting and starting over.would likely prove particu- None of these options larly efficacious for a variety of reasons. Boycotting an isolated event nor does not address the underlying pervasiveness of corruption, 36088-swt_21-1 Sheet No. 63 Side B 02/26/2015 12:25:41 02/26/2015 B 63 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 64 Side A 02/26/2015 12:25:41 121 IN THE WAKE OF BRAZIL 2014 IN THE WAKE What have been notably absent in these diagnostic discussions What have been notably absent about combatting the corrup- Member leagues who are serious M K 2014] soiled organization tentacles of the avaricious and would it sever the in Cameroon, or wa- every Brazilian favelas, villages that reaches into Australia.in halls gering hydra in the form Removing the head of the the corrup- of Blatter also fails to ameliorate of forcing the retirement into every sinew and and ultimately metastasized tion that has grown industry in the past global professional football bone of the greater forty years. of one man or cure is not to be found in the removal The even ten. have made years ago and many experts The diagnosis was cannot just concur with the findings: the corruption declared that they it has spread too far and wide. be surgically excised; A. Cleaning up Football treatment plan.are suggestions for an aggressive plan, treatment The must be multi-pronged and not dissimilar to its medical equivalent, acknowledging the patient may suf- clinical in its precision, and whilst Just as chemotherapy can be a bru- fer in the interim, be unemotional. the end result can be a clean tal process for someone with cancer, surviving body. come from Many of the national and league teams law, and others would like to be countries with a strong rule of cleaner. transnational organized criminal enter- Analogous to a large kingpin organization is the only way prise, sometimes taking out the dissolving FIFA. to start clean; in this instance, by tion at all levels—exhausted the ineffectual monitoring of match- by done in the sport’s name to workers fixing; nauseated by the damage in South Africa, citizens of Brazil, in Qatar, small business owners of these crimes and the countless etc.; the laundering of the proceeds been insidious ways in which the Cup and the sport of football have allowed to be exploited and harmed—should remove themselves from the umbrella organization. Member leagues should seek to build a confederation at a new level, with each country’s teams or host coun- asso- try contributing money to what would become, in effect, a trade ciation for a cleaner sport. Strict rules should be drafted, like the ability to suspend, debar, or ban players, managers, teams, vendors, and sponsors. bodies should Collaboration amongst international and adopt conventions, such as the OECD’s Anti-Bribery Convention the UNODC’s Strategy for Safeguarding Against Corruption in Major \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 25 26-FEB-15 11:21 C Y 36088-swt_21-1 Sheet No. 64 Side A 02/26/2015 12:25:41 02/26/2015 A 64 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 64 Side B 02/26/2015 12:25:41 M K C Y LAY But , P [Vol. 21 120 T I AVE —S AME G LAY THE P UST J T ’ Players Take up the Fight Against Match Fixing in Badminton Further still, mandatory reporting and harmonized Further still, mandatory ON 119 : D SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW (Jul. 21, 2008) (Den.), http://playthegame.org/news/news-articles/2008/players-take- AME Since the awarding of the Cup to Qatar, several of the FIFA Since the awarding of the Cup i) transparent bidding for all services; open and ii) in for companies found to have engaged a debarment system iii)limits on vendor contracts; term iv) business or relationships with FIFA disclosure of any family, v) where FIFA’s (or its successor organization) ac- mandate vi) laws that work in concert with and establishing international Suggesting that the same penalties be applied as those imposed Suggesting that the same penalties G 119. United Nations Office on Drugs and Crime, A Strategy for Safeguarding Against Cor- 120. Maria Suurballe, ONCLUSION THE Committee Members who facilitated the selection had to resign due to Committee Members who facilitated own associations, but this is not allegations of corruption in their nearly enough. the Game, recommended “a The organization, Play can be sentenced with similar rulebook that ensures sports leaders on the athletes” be created. penalties to the ones they impose 122 Public Events. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 26 26-FEB-15 11:21 ruption in Major Public Events (Sept. 2013), http://www.unodc.org/documents/corruption/Publi cations/2013/13-84527_Ebook.pdf. up-the-fight-against-match-fixing-in-badminton. money laundering laws to specify the sport should be instituted, and laws to specify the sport should money laundering adopt rules that require: the industry should and sanction- sports disciplinary bodies investigative bribery (granting corruption ex be a start in prosecuting private ing powers could officio); (or its successor organization) personnel; counts can be based; and teams. those countries that field and host C where would such a rulebook be adjudicated?where would such a rulebook be At the individual state level? at a national level? Or How would it be enforced? Providing without the rule of law how could such rules existed in most countries, one jurisdiction to the next?punishment be equitable from How would venue be determined? on athletes makes little sense. An athlete might be suspended, fined, or even lose their place on a team. Such penalties are not applicable to individuals and entities found to be involved in corruption. Bribery for and its siblings corruption and money laundering should be treated what they are—far to all of society, more damaging crimes, insidious with repercussions felt globally in large and small ways. If an athlete 36088-swt_21-1 Sheet No. 64 Side B 02/26/2015 12:25:41 02/26/2015 B 64 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 65 Side A 02/26/2015 12:25:41 123 IN THE WAKE OF BRAZIL 2014 IN THE WAKE Individuals involved in corruption within the football sector in corruption within the Individuals involved M K 2014] money; if a coun- individuals who gambled may lose throws a match, economic benefits and is awarded the World Cup, the try bribes FIFA losses to others are enormous. to them and the sentences as anyone to the same fines, penalties, and should be subject else convicted of the crimes. to apply criminal penalties The ability crime in de- Corruption will remain a profitable should be available. countries are willing as long as counterparts in rich veloping countries laws and enforce failing to implement the necessary to indulge in it by extent.them to the fullest just play the game—save Don’t it. \\jciprod01\productn\S\SWT\21-1\SWT106.txt unknown Seq: 27 26-FEB-15 11:21 C Y 36088-swt_21-1 Sheet No. 65 Side A 02/26/2015 12:25:41 02/26/2015 A 65 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 4 Side A 02/26/2015 12:25:41 each 1 As is the 2 FOREWORD 74:14. Yet, it was Thomas Hobbes who Psalm 1 3:8; Mauricio Salazar, and Sophia Segura* Mauricio Salazar, Job , (Cambridge University Press Publisher, Richard Tuck, ed. See, e.g. EVIATHAN , L Kenneth Korosi, Kirsten Brown, Christina Marquez, Kenneth Korosi, OBBES H HOMAS From local sporting leagues to international councils and commit- From local sporting leagues to international 2. This, of course, may result directly from the communal identity of sporting events. * the support from many Professors and This Symposium would not exist without 1.novel.not is imagery This The first appearance of “the Leviathan” comes from various M K NTRODUCTION 1996) (1651). “Sport has the power to change the world . . . it has the power to inspire. to It has the power unite [in] a way that little else does.” Speech by Nelson Mandela at the Inaugural Laureus Cen- Lifetime Achievement Award (May 25, 2000) (transcript available in the Nelson Mandela tre of Memory). famously argued that modern government, formed by mass individual covenants, would ulti- famously argued that modern government, formed by mass individual covenants, would mately develop into an absolute sovereignty—anHobbes coined “the Levia- entity to which than.” T tees, modern day sport has evolved into a commodified enterprise—atees, modern day sport has evolved and exploitation converge, leviathan upon which corruption \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 1 26-FEB-15 11:16 Colleagues. to Professor Priya Gupta for the Symposium’s The authors are ever so grateful motivation and continued development. authors are also incredibly grateful for Professor The Alexandra D’Italia’s insight in drafting and editing the Symposium pieces.authors the Finally, other are thankful for the tremendous support from Professor David McFadden and the Resource Librarians at Southwestern Law School. chapters in the Old Testament. I feeding on the passion and patriotism of world spectators. feeding on the passion and patriotism case with any growing commodity, modern day sport has witnessed case with any growing commodity, whether they be official organiza- increasing institutional restrictions, business practices.tions and governing bodies or customary Such re- positions—thosestrictions leave nations in tenuous wishing to nations often channel domestic resources exploit international sporting events than domestic programs aimed at towards the sporting event rather their citizenries.alleviating everyday problems of sport of world The as each fan and player oftentimes will continue to remain nostalgic, team; but the organization of mystically celebrates their venerated more detached, profit-geared enter- modern sport is approaching a prise.not only as a prism by which As such, modern sport functions C Y 36088-swt_21-1 Sheet No. 4 Side A 02/26/2015 12:25:41 02/26/2015 A 4 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 4 Side B 02/26/2015 12:25:41 M K 6 HI- C Y A P 7 ODERN [Vol. 21 M World 4 ISTORY AND , A H eration Internationale de ed ´ OMMODITY AND ITS IVILIZATION TO THE C ECHIKOFF NCIENT A. M A FIFA: A C OBERT ROM : F November 25, 1905: “It seems a thousand pities that in DUCATION Southwestern Journal of International Law Southwestern Journal of International E , FIFA, http://www.fifa.com/aboutfifa/organisation/mission.html OOTBALL AND Anti-World Cup Protests in Brazilian Cities Mark Countdown to F HYSICAL 3 P (June 12, 2014, 5:18 PM) (U.K.), http://www.theguardian.com/football/ The New York Times Such sacrifice is done with the hopes of economic growth done with the hopes of economic Such sacrifice is PORT AND 5 Jonathan Watts, S What We Stand For UARDIAN SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW See , G (6th ed. 2014) (2002). ROPRIETOR NTERNATIONAL To highlight the problems associated with commodifying football problems associated with commodifying To highlight the With any commodified industry, those in power of control stand With any commodified industry, Football and its mega international event—the FIFA mega international event—theFootball and its P 6. The struggle between “football” and “soccer” remains a fierce one, but the majority of 5. 7. According to its mission statement, FIFA has a “duty to society” to “improve the lives 4. football, the F As it controls the international operation of ´ 3. For a diverse pedagogy into sport, see R ORLD LOSOPHY OF Kick-off (last visited Oct. 20, 2014). It is also within FIFA’s mission to give an equal opportunity to and international prestige, and of course, to capture what any sport prestige, and of course, to capture and international the enchanting sense of grandeur. does for its fans: reporting Association football matches The New York Times, in company with all other newspa- pers, should persistently call the game ‘Socker.’ in In the first place, there is no such word, and the second place, it is an exceedingly ugly and undignified one.”Tambor H. Francis from Letter to the New York Times (Nov. 25, 1905). of its of young people and their surrounding communities,” and to “reduce the negative impact activities.” invited scholars and practitioners to submit essays on law and policy invited scholars and practitioners held in Brazil.grounded in the 2014 World Cup The Symposium is responding differently to the ten- proud to publish nine pieces, each for sport and the burdens of its sion between the underlying passion for change. operation, all a resounding call I. I W as a cultural identity, the to gain at the expense of others. true Such an assertion only proves with football itself. or- As the arbiter of international football, FIFA World FIFA football event—Theganizes the largest international Cup—using it as a primary vehicle for “global improvement.” 2 culture and commod- it serves as both a to judge social development, ity in and of itself. \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 2 26-FEB-15 11:16 this Symposium’s authors—much to Francis H. Tambor’s delight—use the term “football.” Tambor wrote to 2014/jun/12/anti-world-cup-protests-brazilian-cities-sao-paulo-rio-de-janeiro (reporting that riots 2014/jun/12/anti-world-cup-protests-brazilian-cities-sao-paulo-rio-de-janeiro (reporting that broke out in Brazil before the opening ceremony of the 2014 World Cup due to citizen unrest). Football Association (FIFA) may well be one of the most influential global institutions. tournament between qualifying countries held every four years, the tournament between qualifying Cup—exemplifies affect and institutionalization how commodification concerns, such as often cede progress in domestic host countries that that operate while trying to please the institutions hunger and disease, the event. 36088-swt_21-1 Sheet No. 4 Side B 02/26/2015 12:25:41 02/26/2015 B 4 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 5 Side A 02/26/2015 12:25:41 3 but 8 OMMIT- TATISTA C , S OLITICS OF UR P NTERNATIONAL HE , O I /T N , http://www.wtmlon : A . 99, 100-102 (2011); Sam OLITICS ARKET PORT FF P S , Oct. 18, 2014, at D5; Maggie A M L Our Approach ’ NT IMES OCCER FIFA: Winner of the World Cup of . I RAVEL , S FIFA, EV T See , N.Y. T CONOMICS OF Brazil Raises Taxes by $7.5 Billion in Quest ORLD E This caused strife among Brazilian HE , W 12 , 31 SAIS R , T (Jan 20, 2015), http://www.businessweek.com/news/ AL FOREWORD . note 7, at 9, 13. an economic analysis on international For The Curse of Good Hospitality: Why Developing Countries ANDY ET USINESSWEEK S supra B , In many instances, lesser-developed host coun- In many instances, (June 2, 2014), http://www.washingtonpost.com/news/morning-mix/ 10 11 OST OBERT Hosting the World Cup is costly—a Hosting the World few of the major 9 . P LOOMBERG , Ellen Bray, ASH , B (2004). , W Mario Sergio Lima & Rachel Gamarski, (2013), http://sites.duke.edu/wcwp/world-cup-2014/fifa-institutional-politics/carica FIFA Corruption Won’t Be Published in Full Total Cost of the FIFA World Cup 2014 in Brazil (in Million U.S. Dollars) See See, e.g. See Our Approach Brazil’s hosting of the 2014 FIFA World Cup exemplifies these Brazil’s hosting of the 2014 FIFA , 2007, at 6. See UNWTO & WTM Ministers’ Summit 9. is the potential increases in revenue that The main incentive to incur these high costs 8. Caricatures of Critique: Is FIFA Rotten to the Core? 10. 12. 11. M K OOTBALL ERSPECTIVE whether they are individuals, corporations, or governments—whowhether they are individuals, sporting events, see R don.com/Content/UNWTO-and-WTM-Ministers-Summit (last visited Oct. 13, 2014).2014 The World Cup’s effects will be discussed November 4, 2014. MENT Shouldn’t Host International Sporting Events Lin, Borden, 2015-01-19/brazil-raises-taxes-by-7-dot-5-billion-to-improve-confidence. stems from increased tourism. World Tourism Organization (UNWTO) and the World The EU mega-events like the World Cup impact econo- Travel Market meet every year to discuss how due in large part to increases in infrastructure and mies and markets within a given host country, host country and improving it as a tourist destina- private investment, as well as re-branding the tion. tries are left with lasting scars inflicted by institutional actors— lasting scars inflicted by institutional tries are left with global hype by oftentimes bypas- take advantage of the tournament’s sing rules of law. wp/2014/06/02/fifa-winner-of-the-world-cup-of-corruption. for Confidence F citizens—those very same fans of the sport. One year before the first demonstrated in the Central Rio kickoff in Brazil, 500,000 people for hosting the games, de- streets against bus fare hikes implemented P (2014), http://www.statista.com/statistics/296493/total-costs-fifa-world-cup-2014-brazil (estimat- ing the total cost of the 2014 World Cup at $10.981 billion). problems. public dollars to pro- Brazil expended over eleven billion at a time when its credit rating was mote and host the World Cup listed one level higher than junk. Cup. lesser-developed countries to host the World 2014] its future locations. to a bidding process to secure World Cup is open with a hopeful eco- to host the tournament comes This opportunity a host country, a sense of pride and honor for nomic boom and \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 3 26-FEB-15 11:16 tures-of-critique-is-fifa-rotten-to-the-core; Terrence McCoy, Corruption? expenditures include financing a bidding process, building stadium financing a bidding process, expenditures include security, and and improving transportation, and related infrastructure, military defenses. the excitement and promotion of the tournament might only serve to promotion of the tournament the excitement and returns and lasting about often mediocre financial obfuscate the truth domestic scars. C Y 36088-swt_21-1 Sheet No. 5 Side A 02/26/2015 12:25:41 02/26/2015 A 5 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 5 Side B 02/26/2015 12:25:41 M K ao C Y OST note . P [Vol. 21 (May 16, ASH supra EWS , W N Fifa Report into Al- (July 14, 2014, 2:10 AILY ]. This drop was not D IMES . T (Nov. 13, 2014), http://www World Cup Protesters, Beaten US URRIYET B L ’ , H NT Protests, Strikes UARDIAN , I Brazil Police, Protesters Clash as World , G (May 12, 2014), http://www.businessinsider.com/ And while this number dropped to And while this 13 NSIDER . I US Brazil Built the World’s Second-Most Expensive Soccer Sta- , B Even now, as government auditors have dis- Even now, as 15 World Cup 2014: Protests in Brazil Fade to Background World Cup 2014: Protests in Brazil Fade to Id. (June 12, 2014, 4:28 PM), http://www.reuters.com/article/2014/06/12/us-bra , Bradley Brooks, 16 EUTERS As one protestor put it, “I love soccer but beyond that put it, “I love soccer but beyond As one protestor ao Paulo a week before the World Cup, secured at least one major housing project ao Paulo a week before the World Cup, secured 14 SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW , R As Qatar positions itself to host the tournament, there are in- As Qatar positions itself to host Protests, Strikes Hit Brazil 28 Days from World Cup Protests, Strikes Hit Brazil 28 Days from World See, e.g. 17 False hopes aside, the public at large is increasingly pushing gov- the public at large is increasingly False hopes aside, 14. 16. 15. These sentiments are shared by many who also love the sport.be would it knew “We 17. A recent ruling by FIFA’s Ethics Committee cleared both Qatar (host of 2022 World 13. Dom Phillips, 5,000 twenty-eight days prior to the opening kickoff, the message days prior to the opening 5,000 twenty-eight lingered. creasing allegations of rising worker deaths, human trafficking, and creasing allegations of rising worker PM), http://www.ibtimes.com/world-cup-protesters-beaten-submission-fizzle-out-brazils-nation al-team-1627636. there are other more important problems—thethere are other right to transport, health, education.” zil-worldcup-protests-idUSKBN0EN1DD20140612. 2014), http://www.hurriyetdailynews.com/protests-strikes-hit-brazil-28-days-from-world-cup.aspx [hereinafter ?pageID=238&nID=66577&NewsCatID=358 dium in a City with No Pro Team 13. “I’m praying that nothing goes wrong. You hear about all these problems, but you still want to root for Brazil.” Brian Winter & Marcelo Teixeira, Cup Begins like this. There is a strong tradition with football that overtakes politics.” Phillips, found with much surprise.start of the tournament, the number of protests Even with the opening match as compared to the twelve days dropped 39% in the first twelve days after the preceding the kickoff. Cup) and Russia (host of 2018 World Cup) for any breaches designed to garner favor in the Cup) and Russia (host of 2018 World Cup) for any breaches designed to garner favor bidding process. The report did, however, note that Russian computers were destroyed, making unavailable to investigators any electronic communications. Owen Gibson, brazils-world-cup-problems-with-corruption-2014-5. leged Corruption Clears Qatar to Host 2022 World Cup .theguardian.com/football/2014/nov/13/fifa-report-alleged-corruption-qatar-2022-world-cup. ernments to blow the whistle on FIFA’s and host countries’ practices ernments to blow the whistle on violations.directly linked to human rights is global Currently, there Cup expected to take place in concern surrounding the 2022 World Qatar. countries, Qatari officials allegedly As is typical of many host enough votes to host the World bribed the FIFA council to obtain Cup. (June 27, 2014), http://www.washingtonpost.com/sports/dcunited/world-cup-2014-protests-in-bra zil-fade-to-background/2014/06/27/9d2dce1e-fbdf-11e3-b1f4-8e77c632c07b_story.html. One so- struggle comes from the Movimento dos cial change “winner” in the Brazilian citizenry Teto.Sem Trabalhadores on land near the Itaquer This pro-housing group, after squatting ˜ 4 health, that the government ensure “FIFA-standard” manding instead education, and transportation. Stadium in S ˜ for its supporters and a slowdown of evictions. Cedar Attanasio, Team into Submission, Fizzle out Like Brazil’s National \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 4 26-FEB-15 11:16 closed multiple instances of fraudulent billing, the Brazilian and Inter- of fraudulent billing, the closed multiple instances and money are crying foul about corruption national media laundering. 36088-swt_21-1 Sheet No. 5 Side B 02/26/2015 12:25:41 02/26/2015 B 5 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 6 Side A 02/26/2015 12:25:41 , 5 HE , T L ’ TATE OF NT S ROTECTING in nine I HEAD OF THE : P UP A C MNESTY A (June 23, 2014), http:// ECTOR ORLD S ECTOR IN THE OST W S P ETTER ATIN See generally sixty-two reforms B , L ONSTRUCTION C ONSTRUCTION S ’ The country’s apparent priori- C UILDING A 22 ATAR , B Q FIFA 2022 (2012). FIFA World Cup Sponsors: Budweiser Partnership (Oct. 26, 2013), http://berkeleytravaux.com/world-cup- FOREWORD ATCH W LOG ABOUR IN THE B HEAD OF L A AW IGHTS POTLIGHT ON L An example of the too-swift justice these Courts An example of the too-swift justice R L For instance, leading up to the 2010 World Cup For instance, leading up to the : S ’ which “had jurisdiction over all crimes arising out which “had jurisdiction over all ATAR 21 IGRANT 19 NT 20 The World Cup: Changing Country’s Laws, One Tournament at a Time I Q World Cup 2010: Fans, Robbers and a Marketing Stunt Face Justice, Fifa UMAN S ’ note 20. (June 20, 2010, 3:39 PM), http://www.theguardian.com/football/2010/jun/20/ IGRATION Despite the report’s notoriety, the Qatari government has notoriety, the Qatari government Despite the report’s Russia and Qatar—an alcohol—are Islamic state with strict policies against in supra M 18 ERKELEY ORKERS IN (2013); H Id. UP : B W UARDIAN IDE OF C (2014). both Amnesty International and Human The DLA Report uses reports from Id. FIFA, the association to which host countries look when prepar- FIFA, the association to which host S , G 20. Marina Hyde, 21. Kathleen Tang, 22. Hyde, 19. sales provides a good example. FIFA’s ability to circumvent bans on alcohol Beer sales 18. DLA PIPER, M M K ORLD IGRANT ATAR ARK RAVAUX Style www.latinpost.com/articles/15443/20140623/fifa-world-cup-sponsors-budweiser-partnership- changing-alcohol-bans-brazil.htm. Je- This has not surprised many, as FIFA Secretary General Cup, so rome Valcke announced in January 2012, “Alcoholic drinks are part of the FIFA World we’re going to have them. won’t Excuse me if I sound a bit arrogant but that’s something we negotiate.” the process of creating “more flexible” approaches to alcohol sales when they host the World the process of creating “more flexible” approaches to alcohol sales when they host the Cups. T world-cup-2010-fans-marketing-justice-fifa. changing-countrys-laws-one-tournament-time. major areas, including: recruitment; foreign resident work sponsorship recruitment; foreign resident major areas, including: accommodation; contracts; wages; health and safety; system; worker and access of association/collective bargaining; inspections; freedom to justice. had been illegal at football matches in Brazil since 2003, but pursuant to FIFA demand, Brazilian had been illegal at football matches in Brazil bill that allowed the sale of beer during the 2014 president Dilma Rousseff signed into law a World Cup matches. Michael Oleagoa, Rights Watch.Rights of unjust treatment of workers and fami- These reports are littered with examples oversight. lies, nontransparent reporting, and lax regulatory Q D W M 2014] labor laws. failure to recognize international the broad-reaching In commissioned allegations, the Qatari government response to these of migrant workers law firm to research treatment an international and prevents that ties them to their employers under a legal system their right of movement. report, noting a death rate of The 135-page person per day, suggested more than one \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 5 26-FEB-15 11:16 of the World Cup.” in South Africa, at FIFA’s request, South Africa also created FIFA in South Africa, at FIFA’s request, World Cup Courts made no significant changes at reform. unscathed for its opaque and nearly ing for the tournament, remains coercive practices. Changing Alcohol Bans in Brazil, Russia 2018, Qatar 2022 provided included “two Zimbabweans who robbed some foreign jour- provided included “two Zimbabweans on the Thursday, and began 15- nalists on a Wednesday, were arrested year jail sentences on the Friday.” C Y 36088-swt_21-1 Sheet No. 6 Side A 02/26/2015 12:25:41 02/26/2015 A 6 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 6 Side B 02/26/2015 12:25:41 M K C Y a-vis [Vol. 21 This begs the 23 note 11. supra YMPOSIUM S SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW HE With the evolution of the sport in mind, the Honorable Fausto With the evolution of the sport Although critics of FIFA’s governance and opacity have brought Although critics of FIFA’s governance approach, looking at The first set of essays take an ontological Regardless of the recent media attention on FIFA’s actions, the recent media attention on FIFA’s Regardless of the 23. Borden, professionalization. on political economy, Simon Archer, by drawing the role of law in football, one must argues that to best understand rooted in social, economic, and cul- first look at globalization theories tural conditions.By juxtaposing “merely a game” with more serious the underlying anxiety with problems in politics, Archer captures or economic theories. viewing football in light of legal blueprint to examine the attendant Martin De Sanctis articulates a problems of corruption and other financial crimes in international football. Sanctis notes that the sheer diversity of stake- Justice De to holders in the football industry enables many financial criminals hide illicit activities in international markets. By examining the con- the stitutionally dubious requirements FIFA imposed on Brazil to host Cup—includingWorld prohibiting collection of any taxes or fees 2014 and from FIFA, as well as temporarily permitting unrestricted import of export of any goods necessary for the organization without charge any duties or tax—Justice FIFA should be De Sanctis maintains that bound to certain normative obligations. attention to specific sporting events, the scholars in this Symposium attention to specific sporting events, and articulated initiatives that have identified structural deficiencies of sport.construct a more equitable world to strive contributions The global passion for football and its reframe the disparity between the operational dysfunctionality. They do so in three ways. and its development vis-football’s inception as a past-time ` 6 clearly illustrates crimes over others tization of football-related influence. FIFA’s powerful information. Even refusing to cooperate by sharing Association is still release the findings Senator Bob Casey asking it to in the face of U.S. surrounding the into corruption allegations of its internal investigation so. Cup bids, FIFA refused to do 2018 and 2022 World \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 6 26-FEB-15 11:16 question: will countries remain complacent with FIFA’s perquisite of remain complacent with question: will countries defend the rights of as a commodity, or will they controlling football and risk ostracizing the monolithic power of FIFA their citizens over community? themselves from the international II. T 36088-swt_21-1 Sheet No. 6 Side B 02/26/2015 12:25:41 02/26/2015 B 6 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 7 Side A 02/26/2015 12:25:41 7 contend that Bra- 24 FOREWORD In striving to protect the rights of sports fans, Pedro Rubim the rights of sports fans, In striving to protect corruption and of essays specifically addresses The second group his students Andrew Spalding and a group of By specifically examining anti-corruption law in Brazil, Thiago 24. These include Patrick Barr, Albert Flores, Shaun Freiman, Kat Gavin, Tyler Kink, M K 2014] framework underly- there should be a judicial Borges Fortes contends football that transcends any organization.ing international this, do To should be protected that fans’ rights as consumers Fortes contends system. with a normative and judicial first by arming them ac- This, as fans have come to will only improve the game we cording to him, love. Cups and Olympic in the context of the past World money laundering Games. approach to international sporting By taking a macro-level that the recent transpirations in events, Mikail Reider-Gordon posits how to better combat corruption. Brazil actually provide insight on cases to illustrate the pervasive After explaining the myriad of recent sporting events, Reider-Gordon nature of corruption in international notes the consensus—that just be surgically excised, corruption cannot umbrella organization.as it is infused in FIFA, football’s As such, she encouraging member leagues to proposes that FIFA be dissolved, with each team or host country build a confederation at a new level, become a trade association for a contributing money to what would cleaner sport. \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 7 26-FEB-15 11:16 Carter Nichols, Ann Reid, and Rina Van Orden. zil has recently become a symbol for the global anti-corruption move- zil has recently become a symbol ment.a robust historical analysis of anti-corruption After providing sports, Spalding and his students movements in Brazil and modern that have infected FIFA and specifically focus on corruption scandals Olympics. Winter recent the As part of Spalding’s ongoing research, of questions as to whether Brazil will he and his students pose a series in the eyes of the media and public ultimately become a ‘success story’ at large. Bottino notes its weaknesses in regulating football as a business. However, with the enactment of the Brazilian Anti-Money Launder- ing Act of 2012, new light has been shed on certain business practices, putting them on the same regulatory baseline as financial transactions. But this, according to Bottino, is not enough to properly combat money laundering. calls for more definitive rules that account Bottino for market-specific factors, allowing violators the ability to cooperate ex ante, and rewarding whistle-blowing. C Y 36088-swt_21-1 Sheet No. 7 Side A 02/26/2015 12:25:41 02/26/2015 A 7 Side No. Sheet 36088-swt_21-1 36088-swt_21-1 Sheet No. 7 Side B 02/26/2015 12:25:41 M K C Y [Vol. 21 SOUTHWESTERN JOURNAL OF INTERNATIONAL LAW The Symposium’s distinguished contributors provide a dynamic In a more personalized piece on corruption, Roberto Delmanto piece on corruption, Roberto In a more personalized stances on problems attrib- Essays in the final group take unique piece from Guillermo Closing the Symposium is an insightful ONCLUSION view on some of the shifting sets of issues underlying international sporting events commodification. Their observations are, in diverse be- ways, crucial commentaries on addressing the tensions that arise tween the sport’s commodification and society’s passion for it.We fur- hope these engaged perspectives further an ongoing agenda for inter- ther advocacy in response to the social unrest surrounding many national sporting events such as the World Cup studied here. 8 a Brazilian attorney his first-hand experiences as Junior draws upon Collar Crime.specializing in White outrage in The never-before-seen World Cup expend- use of public expenditures on response to Brazil’s access to free- large part, to the public’s increased itures was due, in and the press.doms to technology But such access and freedom may at battling cor- by recent legislation aimed ironically soon be curtailed laundering.ruption and money recent judicial activism has While that much is left transparency, Delmanto argues aided governmental in the context of of battling corruption, especially unturned in terms Brazil. financing political campaigns in utable to institutionalizing ethics. Warren S. Grimes, by examining of television distribution rights, the awarding and trickle-down effect anticompetitive because it prevents argues that the process is purely of channels in top-heavy bun- consumer choice by forcing inclusions dles. This, he argues, causes price inflation and may lead to consum- ers cutting the cord. of many manifestations While the process is one that antitrust laws are designed to of the classic competition dilemma governmental enforcers have ac- remedy, neither the FCC nor other ted to protect the consumer. disciplining Ultimately, Grimes calls for by creating a more competitive, con- FIFA’s monopolistic leveraging sumer-friendly distribution system. Independent Governance Commit- Jorge, a former member of FIFA’s tee (IGC). corruption scandals, FIFA’s Execu- In response to internal like the IGC to recommend and tive Committee appointed task forces structure.oversee the reform to FIFA’s governance Having partici- the reform process the IGC oversaw, pated in the IGC, Jorge explains FIFA into a more pluralist, including the first attempt to transform transparent, and accountable organization. C \\jciprod01\productn\S\SWT\21-1\SWT101.txt unknown Seq: 8 26-FEB-15 11:16 36088-swt_21-1 Sheet No. 7 Side B 02/26/2015 12:25:41 02/26/2015 B 7 Side No. Sheet 36088-swt_21-1