ICC withholds $ 9 million payment to India

MUMBAI / NEW DELHI: Yesterday, it was the morning after for the cricketing world after the drubbing the all-conquering Australians gave India in Sunday's World Cup finals. Matters have now moved from the field into the boardrooms with the ambush marketing issue back on the frontburner.

The first salvo was fired by the ICC last Saturday itself when it put out a statement that India's full share of World Cup participation payments of between $ 8 and $ 9 million (about Rs 420 million) has been withheld, confirming the decision reached by the world cricket body's governing board prior to the start of the tournament.

The amount retained reflects the ICC's initial calculations of the potential liability attached to the dispute, the statement says. This will obviously arise out of the compensation claims being made on IDI (the commercial arm of the ICC) by the News Corp vehicle Global Cricket Corporation (GCC) on the ambush marketing issue.

The liability slapped on India is the biggest by far but it is not alone in having to face payment cutbacks. Three other countries - England, New Zealand and Sri Lanka - are also in the dock. $ 3.5 million has been withheld from England for its decision not to play in Zimbabwe, $ 2.5 million from New Zealand for not playing its game in Kenya, and $ 500,000 from Sri Lanka for failing to meet the deadline for completion of its player contracts.

The ICC's action against India is a fallout of the Indian players' refusal to accept the ICC contract terms.

"That ICC will hold back the Rs 40 crore (Rs 400 million) was known to us as also the fact that an arbitration (probably before the Court of Arbitration for Sport in Lausanne, Switzerland) will take place. The working committee will decide the future course of action on this,"a senior member of the BCCI (Board of Control for Cricket in India), on condition of anonymity, told today.

The BCCI member also indicated that 10 April is being "talked" about as the date for the working committee meeting, adding that coming up with an immediate offensive reaction may not be in the best interests of the game or the BCCI.

What is also interesting is that the BCCI is depending on a change of the top guard at the ICC itself to resolve the problem arising out of the guarantee money being held back by the ICC.

It is reliably learnt that Ehsan Mani, a Pakistani national now settled in Britain, is likely to succeed the present president of the ICC Malcolm Gray. "When Mani comes in, BCCI's problems may ease a bit and so may the strident posturing of the ICC top brass against India and the BCCI," the Board member explained.

ICC has already threatened that India risks suspension if the claims amount to more than $ 9 million and India refuses to pay up.

The BCCI landed itself in this situation after its head, the wily Jagmohan Dalmiya backed its players vis-a-vis the clauses in the contracts demanding that players agree to forgo personal sponsorships which conflicted with those of the ICC’s official sponsors for the duration of the World Cup and for 30 days either side of it.

Indian players, who earn far more than their international counterparts from cricket endorsements, altered the restrictions to refer only to the period of the tournament itself.

There was also the issue of imaging rights. The BCCI demanded that imaging rights remain in force for two months and not three months as was being offered by the ICC. Originally, the ICC sponsors wanted the imaging rights of the players for six months.

The ICC accepted the amendments but told India before the World Cup that it would withhold the money that they were expected to earn from participating to cover possible claims by GCC and the tournament's sponsors after the tournament.

At the core of the dispute is the $ 550 million that the GCC - then a 50:50 JV between News Corp and World Sport Nimbus (itself a 50:50 JV between Harish Thawani's Nimbus Communications and World Sport Group) - committed to pay in mid-2000 when it acquired all of the ICC's commercial rights in a seven-year deal. The agreement gave the GCC the worldwide rights for television, Internet and sponsorship for a period that includes the 2003 and 2007 cricket World Cups.

The reports going out are that News Corp is considering a demand that the deal should be renegotiated or scrapped. Renegotiating, yes but scrapping? Looks highly unlikely and it all seems to be part of a bargaining gambit on the part of News Corp, the basic aim of which is to lay the groundwork making a case that the payments that GCC will have to make to the ICC be reduced.

GCC, in a statement released just ahead of the World Cup had said: "The ICC consistently assured GCC the player restrictions would be delivered and we sold sponsorships as a result - GCC did not suddenly demand the sponsor protection.

"The fact that all of these rights have not been delivered as promised has obviously caused problems for our sponsors and our broadcasters."

According to sources who have been in the thick of the cricket sponsorship deal, what has forced GCC to take this line is the squeeze put on it by its global partners LG Electronics and Pepsi. The other big India sponsor, motorcycle major Hero Honda (official sponsor), has not made such a big to-do over it though it could be argued that this is because it has not sunk in that much money as the other two.

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