FIFA World Cup 2014 Ticket Touting Scandal

Brazilian Police have discovered a ticket touting scandal involving the illegal sale of World Cup tickets. Initial investigations have led to the arrest of, amongst others, Ray Whelan, the British director of the World Cup’s hospitality company, MATCH.

FIFA has always ensured that tickets reach genuine fans at a reasonable price. Historically, it has been opposed to the parallel market for ticket sales, because it has no control over who buys the tickets or the price of them. More importantly, FIFA does not benefit from the extra money the touts receive when they sell tickets at a premium.

FIFA has strict rules on the sale of tickets to its competitions, especially for the World Cup. Clause 4.1 of the 2014 FIFA World Cup General Terms and Conditions for the Use of Tickets (“GTCs”) stipulates that ticket purchasers and tickets holders:

MAY NOT SELL, OFFER FOR SALE, OFFER AT AUCTIONS, RESELL, DONATE, ACT AS COMMERCIAL AGENT FOR ANOTHER PARTY OR OTHERWISE TRANSFER THEIR TICKETS IN ANY WAY WITHOUT THE SPECIFIC PRIOR WRITTEN CONSENT OF FIFA. FIFA will only give such consent in case a Ticket Holder:

(i) wishes to transfer a Ticket to a privately invited guest or family member for free or for the price charged to the Ticket Holder by FIFA,

(ii) (ii) is seriously ill or has died, or (iii) any other reasons which may be defined by FIFA in the Ticket Transfer and Resale Policy available on www.FIFA.com

The main reasons for these restrictions on transferring tickets, according to Article 2 of the FIFA Ticket Transfer & Resale Policy (TTRP), are to:

(a) ensure that tickets are sold to true fans of the Event, not those who are simply seeking to buy and resell tickets for their own commercial gain;

(b) ensure that once sold, all tickets to all matches are actually used by true fans;

(c) maximise access to tickets for true fans;

(d) provide opportunities for consumers who, after successfully acquiring tickets, later realise that they (or their Guests as defined in Section 3  (iv) below) are unable to attend the event or single matches;

(e) provide a safe, legitimate means for consumers to transact in a secondary market for tickets without being subject to the misleading practices of those who engage in unauthorized re-sales and undermine the law and policies established by FIFA; and

(f) facilitate security plans and policies for the Event.

FIFA’s consent and authorization for Ticket transfers and re-sales are subject to the rules outlined below.

Any person giving up their ticket must resell it to FIFA and the entity in charge will then put them on sale again, according to the Article 3 of TTRP. This is intended to prevent individuals reselling their tickets directly.  Ironically, in this instance, this would mean giving the ticket back to MATCH to be resold.

“Group sales” of tickets for those such as event sponsors, member associations, the Local Organising Committee and match hospitality, which have been sold directly via an official match hospitality agent, are also not eligible for transfer or resale under this Ticket Transfer and Resale Policy. Those holding such tickets should contact the individual or entity from which they received the ticket.

To avoid a parallel market developing, FIFA engaged the services of MATCH to manage the sale of tickets for the World Cup. Consequently, it will be a big embarrassment to FIFA if it is proven that the very agency it has instructed is guilty of the scam – and it may not just have been at this World Cup. Evidence suggests that this company has been operating a parallel market (black market) for at least four World Cups.

The people involved in this situation can be criminally charged under Brazilian law – for being involved in organised crime, money laundering and for the illegal commercialisation of tickets. The criminalisation of ticket touting was introduced specifically for this World Cup – Brazil had to adopt new legislation in order to host the tournament (just like London did for the 2012 Olympic Games).

Interestingly, in order for a ticket touting prosecution to go ahead, FIFA must consent. However, the President of FIFA, Joseph ‘Sepp’ Blatter, has a nephew who is a shareholder of MATCH, meaning there are likely to be some interesting developments on this case. However, if evidence confirms FIFA officials were involved, the Disciplinary Committee will act again and justify a definitive or temporary ban on them taking part in any football-related activity according to Article 22 of the FIFA Disciplinary Code.