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Avoiding a major event own-goal

By Arthur Chan

Hong Kong, 20 February 2024: The fallout from star footballer Lionel Messi’s no-show in Hong Kong has highlighted the pitfalls of organising major sporting and entertainment events. Aside from the risk of reputational and financial damage for stakeholders when a large event encounters a serious problem, there are also legal ramifications to consider.

No sizeable event is risk-free, of course, and various types of unfortunate incident may impact its success. Precision planning, however, can mitigate against the unexpected. A good starting point for organisers is undertaking a comprehensive risk assessment based on the nature of the event, venue, participants and audience.

In this regard, contracts are the bedrock of event planning, so risk assessment should include a review of agreements – usually, there will be many – signed by organisers, participants, collaborators, vendors and the like. Service contracts typically include the following:

Scope of work: This describes exactly what the contractor will deliver, in what quantities, and when and how this will be done. It should outline the responsibilities and expectations of all parties. The scope of work should also be clear, detailed and realistic.

Payment terms: How much, when and how payment is to be made, including details of any deposits, fees, gratuities, incentives and the like which may be included. Payment terms should be reasonable and transparent, to lessen the likelihood of disputes, and should also outline any discounts or refunds that will apply in case of changes, cancellations or non-performance.

Cancellation policy: This defines what happens if either party terminates the agreement before the event date. Typically, it should refer to the conditions, procedures and consequences of cancellation, specifying notice periods and relevant cancellation fees. The cancellation policy would usually include force majeure clauses to cover unforeseen circumstances such as natural disasters or health emergencies.

Confidentiality: Typically, the parties will agree to share all necessary information related to the event, but this information can only be relayed to third parties with permission.

Liability and insurance: This section covers potential risks and damages during or after the event, such as injuries, accidents, property damage or legal claims. It should include the extent and limits of the liability and insurance coverage of both parties, as well as any indemnity or waiver clauses. The idea is to minimise the exposure and losses of both parties.

Dispute resolution: This addresses how the parties will handle any conflicts that arise from the contract or the event. It should include steps and methods, such as negotiation, mediation, arbitration or litigation – and should be compatible with local law.

As we have learned from the Messi furore, however, even watertight contracts count for little if an event encounters an unexpected problem and is then beset by poor communication or lack of transparency. As has been well documented, the Argentine icon arrived in town with his Inter Miami teammates for an exhibition match against a Hong Kong XI on 4 February, but he was carrying an injury. Team medical staff decided hours before kick-off he would not play, but this was not immediately communicated to other stakeholders, principally event organiser Tatler Asia, government ministers, or fans who had paid up to HK$4,880 per ticket.

Hence, the angry scenes and booing that followed the final whistle and the continuing fallout which includes huge reputational damage for Messi and his team, likely financial loss for Tatler Asia (following its pledge to give a 50% refund to ticket holders) and possible legal action. Thus far, more than 1,300 complaints have been lodged with the Consumer Council.

It is worth noting, in fairness, that our city did stage a hugely successful football match just nine days after the Messi debacle. More than 20,000 fans watched a star-studded World Legends team defeat their Hong Kong counterparts 7-3 in the Lunar New Year Cup. The game featured multiple World Cup winners, was played in great spirit and offered marvellous entertainment.    

In communicating with stakeholders and the public, transparency is key. It is imperative that event organisers clearly explain any restrictions in the performance contract and associated possible risks, thus allowing consumers to make an informed decision. Clear communication about unexpected developments, with contingency planning in place, is strongly advised. For event attendees, it is best to retain receipts and transaction records in case of future claims.

As always, we recommend seeking legal advice when it comes to contract drafting and best practices aimed at reducing risk. Here at BC&C, we have a team of experienced legal professionals ready to assist.

Arthur Chan is a Senior Associate with BC&C. He specialises in Criminal Litigation and cyber fraud recovery claim and also develops a broad range of civil and commercial litigation such as immigration, personal injuries and employment issues. He can be contacted at Arthur@boasecohencollins.com.

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