The International Tennis Federation has set a precedent to claim compensation for refusing to compete

The International Tennis Federation (ITF) has published financial statements for 2022, from which it follows that the structure’s revenues suddenly soared by $12 million at once. They were received by the decision of the Court of Arbitration for Sport (CAS) as compensation for Hungary’s refusal to host the Billie Jean King Cup final in 2021. The CAS decision sets an interesting precedent, which is directly related to Russia, which, after the start of events in Ukraine, lost a number of tournaments, for example, the volleyball world championship. Yesterday, the All-Russian Volleyball Federation (VVF) announced that consideration of its lawsuit demanding compensation of $80 million in expenses for preparing for the championship will begin in the fall.

The International Tennis Federation has reported an amazingly successful 2022 season. The federation’s revenues were $98.3 million, more than $32 million more than the previous season, and even more than in the last pre-pandemic season: in 2019, the ITF earned almost $89 million. Note that, according to the federation itself, restrictions related to the coronavirus pandemic cost it about $75 million.

The ITF figures are, of course, excellent. Another thing is that the excess of 2019 figures would not have happened if it were not for what the federation report called “unusual income”. This is a story that happened in 2021. Then the Hungarian Tennis Federation refused to hold the final of the Billie Jean King Cup (before reformatting in 2020, the tournament was called the Federation Cup), citing the inability to accept and ensure safety, primarily epidemiological, 60 tennis players from 12 teams and their accompanying staff. The cancellation happened in May 2021, and the ITF had very little time to attach the tournament somewhere else (in the end it was held in Prague and won by the Russian team). For the Hungarian side, the decision to abandon the tournament did not go unnoticed. According to the ITF report, the federation appealed to the Court of Arbitration for Sport, which, as it turns out, ordered the Hungarian tournament organizers to compensate the ITF for losses of $20 million (in the worst case, the amount of compensation could exceed $55 million). Of this amount, $8 million was received by the ITF in 2021, and another $12 million in 2022. They are the very “unusual income” that allowed the ITF to surpass the performance of 2019.

At first glance, this is nothing more than a local story of a dispute between two business entities in the sports industry. But in fact, the CAS decision can be seen as a precedent that plaintiffs can rely on in other cases of this kind. One of them, and a very large one, directly concerns Russia. After the events in Ukraine began, international sports federations began not only to massively remove Russian athletes from participation in competitions, but also to deprive Russia of the right to host tournaments, including those for which serious resources had already been spent on preparation. The most financially sensitive loss was the withdrawal of the right to host the men’s volleyball world championship, which was supposed to be held from August 26 to September 11, 2022 in ten cities of Russia. Given the scope of the championship, the costs of preparing for it were substantial. In May of this year, the All-Russian Volleyball Federation filed a lawsuit with the CAS against the International Volleyball Federation and demanded compensation for the losses. In particular, the WEF demanded the return of $40 million paid for the right to host the tournament, a fine of $12 million, and compensation for the expenses already incurred for the organization. The total amount of claims is $80 million. As VFV President Stanislav Shevchenko told TASS on Friday, the consideration of the case will begin in the fall.

The Commonwealth Games Federation can also rely on the precedent with the CAS decision in the ITF case. These Games are one of the largest competitions in the world: in 2022, more than 5,000 British Commonwealth athletes took part in them, competing in twenty sports. Actually, there is only one more representative event in sports – the Olympics. The 2026 tournament was supposed to be held in five cities in the Australian state of Victoria, but last week the state authorities backed out of their commitments, saying that the cost of organizing the tournament would be more than double the planned $4.7 billion instead of the estimated $2.3 billion. In response, the Commonwealth Games Federation said it would seek compensation for losses. And she has a precedent to refer to.

Alexander Petrov