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Canal Plus cites ‘force majeure’ in French football rights fee dispute

(Photo by FRANCK FIFE / AFP) (Photo by FRANCK FIFE/AFP via Getty Images)

French pay-television broadcaster Canal Plus is citing force majeure as the basis for its refusal to pay an upcoming €110m ($120m) instalment on this season’s Ligue 1 and 2 fee obligation.

The broadcaster told the AFP that the French Professional League’s (LFP) suspension of football fixtures due to the Covid-19 pandemic was a “perfect example” of force majeure.

It said: “There are no more matches, so there are no more payments. We are strictly applying the terms of the contract and we don’t see why we would do it any other way. Canal Plus is not a bank.”

Canal Plus’s chief executive Maxime Saada informed LFP of the company’s position in a letter, which was reported by French newspaper L’Équipe over the weekend. Saada said that the coronavirus crisis had affected “almost all of the activities” of the Canal Plus Group.

A working group is in the process of being set up by the LFP to handle negotiations with Canal Plus, reports Le Monde. Its definitive composition will be ratified on Friday by the executive board.

Outstanding balance

The €110m instalment is due on April 5 and the elite French clubs would be the main beneficiaries of this payment.

The LFP has reacted with incredulity at Canal’s stance and what they consider a lack of solidarity in the circumstances. Broadcast rights payments were Ligue 1 clubs’ biggest revenue source last season, amounting to 36 per cent of total incomes, according to the Direction Nationale du Contrôle de Gestion, French football’s financial watchdog.

The league said that, in any event, Canal Plus still owes it money despite the suspension of fixtures, as 28 of the 38 matchdays had been played. This amounts to 73.7 per cent of the full product having been delivered, while the Vivendi-owned broadcaster has, so far, only paid for 67 per cent of the product. The LFP calculates the outstanding balance at €43m, including relevant taxes.

But Canal Plus refutes the LFP’s view, with the broadcaster telling AFP: “Nothing in the contract says that the deadlines are linked to broadcast matches. There is a broadcast schedule and a payment due schedule that have nothing to do [with one another]”.

Canal and Qatar-backed pay-television broadcaster beIN Sports pay a combined €748.5m on average per season for rights to Ligue 1 and Ligue 2 from 2016-17 to 2019-20.

BeIN is also scheduled to make a fee payment on April 5 of €42m. It is estimated that a €15m portion of that figure corresponds to matches that have already taken place. However, beIN has yet to inform the LFP of its own stance on the matter.

Canal and beIN are then due to make further fee instalments totalling €140m on June 5, comprised of €85m and €55m, respectively.

Uncertainty

Ligue 1 and Ligue 2 have both been suspended since March 13 due to the Covid-19 pandemic. The LFP has provisionally scheduled a resumption on May 15, with a planned end to the season on July 15.

However, this schedule remains tentative and there is a real possibility that the 2020-21 season timetable will also be affected. This holds up the possibility of further fee wrangling between the LFP and Canal for the next season.

Canal Plus has sublicensed rights to two Ligue 1 matches per matchday from beIN for the 2020-21 to 2023-24 cycle as part of a wide-ranging distribution and sublicensing agreement. Spanish agency and broadcaster Mediapro holds the rights to the bulk of Ligue 1 matches over the new cycle and is to launch a new pay-television service in France.

The LFP recently gave Canal Plus and beIN Sports access to a host of archive content following the postponement of the league.

The current stand-off between the LFP and Canal follows the broadcaster’s decision last year to take the LFP to court after a series of match postponements in the 2018-19 season due to protests by the ‘yellow vests’ movement.