The Confederation of African Football (CAF) has won a legal battle over the termination of a $1billion commercial deal with sports agency Lagardère Sports, the African governing body announced on Saturday.
French-based Lagardère Sports filed a lawsuit against CAF to the International Chamber of Commerce (ICC) following the termination of the contract last November.
"Lagardère Sports alleged that CAF had unlawfully terminated this contract and asked, among other things, that CAF be required to immediately reinstate the contract," a statement on the CAF official website read on Saturday.
"In the decision, notified on 13th December 2019, the Emergency Arbitrator considered the reasons why CAF terminated the agreement, and rejected all the requests of Lagardère Sports."
In 2015, CAF, who were led at the time by Cameroonian veteran chief Issa Hayatou, and Lagardère Sports announced a 12-year extension of a previous deal that was set to run from 2009 to 2016.
However, following rulings from Egyptian courts, the African governing body had to terminate the contract, insisting that it was not a "unilateral decision" but a "legal consequence".
Egyptian court rulings
"In 2017, the Egyptian Competition Authority (ECA) found that the agreement breached Egyptian competition rules because Lagardère was appointed as CAF's exclusive agent for the marketing and media rights for an uninterrupted 20-year period without any open tender," CAF said in a statement last month.
"By the same decision, ECA declared the agreement null and void and imposed a number of remedies on CAF. Those remedies included the obligation to immediately terminate the agreement and suspend its effects within the Egyptian market."
Cairo economic courts issued two judgments in 2018 and 2019 (case number 397 of 2017 and number 434 of 2019) whereby they found the two former CAF officials who had signed the agreement, former president Issa Hayatou and former secretary-general Hicham El Amrani, guilty of anti-competitive and fraudulent conduct.
The court imposed a fine of EGP 500 million on each of them. On appeal, the fine was reduced to EGP 200 million and CAF was held to be jointly liable for the payment of the fine.
In 2017, the Competition Commission of the Common Market for Eastern and Southern Africa (CCC) assessed that the agreement had infringed the CCC’s competition regulations.
It recommended the imposition of a financial penalty on CAF and the adoption of certain remedies, including the termination of the agreement.
Upon review of the aforementioned, the ICC cleared CAF from any wrongdoing and ordered Lagardère Sports to pay the administrative costs of the arbitration proceedings and also to contribute over 60,000 euros towards CAF legal costs.
"With the support of FIFA, CAF will continue to stand up for the rights of football fans who want to be able to watch African football in their respective countries, and CAF will also safeguard the rights of genuine commercial partners who want to see a healthy, competitive and transparent football business environment in Africa," CAF statement concluded.
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