The World Cup has undoubtedly grown in size and influence.
Its organising committee, FIFA, has had to work increasingly closely with the governments of host nations. For this year’s World Cup in Brazil, FIFA has even gone as far as changing some of the country’s law.
Before choosing a host country, FIFA requires a “government guarantee” on certain legal issues, including: security, alcohol, visa procedures, customs and tax law, infrastructure and labour relations. Currently, Brazil faces an uphill battle to complete its stadiums, build adequate transportation infrastructure and comply with various demands of FIFA.
Brazil has run into several issues with the guarantees it made to FIFA in order to secure the 2014 World Cup. FIFA has stipulated that Brazil must allow the sale of alcohol at stadiums. However, under The Brazilian Federal Statute n.10.671 of 2003, this prohibits the entry and sale of alcoholic beverages inside stadiums during football matches.
This is a major concern to one of the main sponsors of the FIFA World Cup – the Budweiser beer brand, which contributes about £16.5m to FIFA. To address this issue, Law 12.663/2012 – the ’World Cup Law’ – which came into effect in June 2012, has been amended and now finalised by Brazil’s congress, opening the way for sale of alcohol at World Cup matches in Brazil.
Article 23 of the World Cup Law states that Brazil will assume civil liability on behalf of FIFA and its representatives for any losses or damages resulting from any security incidents or accidents in relation to the World Cup, unless such incidents or accidents were as a result of an act or omission by FIFA or the victims themselves.
However, under Brazil’s constitution, the State can only assume liability where damage is caused by the performance of a public service; this includes instances where a service is performed directly by a public entity or where public services have been provided by a private entity. For these purposes, FIFA is neither a public entity nor is it providing a public service, so the state’s promise to assume civil liability for FIFA, even when the state is not at fault, appears unconstitutional.
Images, broadcasting and trade
Brazil also faces direct conflict with Articles 12-15 of the World Cup Law. FIFA owns all exclusive rights to the images, sounds and other forms of expression of events including broadcasting and transmissions.
However, under Brazil’s constitution, the rights related to the football events belong to the clubs, which gives them the right to distribute images by any means or process of the event they participate in.
Additionally, FIFA can also define areas of “commercial restriction” within 2 kilometers around the stadiums without prejudicing the establishments which have no association with the tournament. Here there will clearly be conflicts with freedom of competition on the part of those Brazilian companies who are not official sponsors of the World Cup. Such FIFA restrictions may only be challenged if they infringe a third party’s vested constitutional rights.
It is clear that general public interest is at the forefront of this year’s World Cup. If Brazil is not willing to comply with FIFA’s demands, they risk upsetting FIFA, thus creating legal uncertainty so close to the World Cup. So far, Brazil (much to the reluctance of its lawmakers) has adapted, yet it seems that the country has no choice but to accept the demands of such a powerful organising committee.
By accepting FIFA’s demands of hosting the World Cup, Brazil should ultimately add around £52bn to its Gross Domestic Product. However, the smooth running of the World Cup – and Thiago Silva and Co lifting the trophy – will be the only true sign of achievement for a nation under immense pressure.
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