Union chasing 'lost' millions
THE Hong Kong Rugby Football Union will ask for a multi-million dollar compensation from Rugby World Cup Ltd (RWC) for losing the 1997 Hong Kong Sevens tournament.
Compensation in the region of 'eight figures' will be discussed between the HKRFU and the board of directors of RWC, at next week's crucial meeting in Hong Kong where planning for the second World Cup Sevens will begin.
Due to the Rugby World Cup Sevens, to be held in March 1997, the Hong Kong Sevens will not be staged that year. And as the Hong Kong Sevens is the local Union's major source of income, a sum in the region of HK$10 million will be asked as compensation from RWC Ltd.
Chief executive officer of the HKRFU, Dave Roberts revealed that both parties will have to hammer out a profit sharing agreement and that this will be top of the agenda.
'It is not so much as if we will be asking them to pay up-front, but we will be asking for a guarantee from Rugby World Cup Ltd. There will have to be some sort of profit-sharing deal and this will be one of the major points of discussion,' said Roberts.
Stewart Leckie, HKRFU chairman, added: 'Rugby World Cup Ltd will not try to make money at the expense of the host nation. At any RWC event, the host nation will not lose out and in this case too we have been given a guarantee.' It is known that the HKRFU will base their figures on the profits made at this year's Hong Kong Sevens plus inflation.
According to Roberts, the final profit figures for this year's Hong Kong Sevens is estimated to be well over $6 million.
'I think what we will be looking for from RWC will be well into double figures,' said Roberts.
Preliminary discussions have revealed that the HKRFU are unlikely to run into problems from RWC Ltd. When the bid to host the World Cup Sevens was made, the Union informed RWC Ltd that they would be out of pocket if the Hong Kong Sevens was not staged in 1997.
'We told them that we can't run our organisation for another year if we did not get the revenue from the Hong Kong Sevens. They agreed that we would be suitably compensated. Now what matters is that we have to agree on a sum,' said Roberts.
The local Union is mainly dependent on the money it earns from the annual Hong Kong Sevens which is used to fund their extensive development programme, in and out-going tours and pay for its many full-time staff.
RWC have always shared profits with the host nation. But Roberts said that unlike the recent World Cup 15s in South Africa, a different formula will have to be found to the profit-sharing agreement.
'In South Africa, a large percentage of the income came from gate receipts. This will not be the case in Hong Kong where the bigger revenue earners will be television rights and sponsors. So we will have to sit down and work it out how to strike a deal.' The entire board of directors of RWC Ltd - Sir Ewart Bell, Nic Labuschagne, Leo Williams, Keith Rowlands and Marcel Martin - will arrive on July 30 for a four-day meeting with senior Union officials.
While the subject of compensation will figure largely in the talks, the other major decisions which will be made at the meeting will include the dates of the tournament, the ticketing policy and who the sponsors will be.