- SA Rugby has been accused of ‘riding roughshod’ over its unions in the area of sponsorship and commercial rights contracts.
- Aerios allege that both SA Rugby and WP bosses have been ‘reckless’ in their dealings in that landscape.
The company taking both the South African Rugby Union and Western Province Rugby Football Union to court for multimillion-rand damages says it has “solid evidence” in its battle.
Commercial rights firm Aerios announced earlier this month that it had taken both bodies to court for damages amounting to R183-million.
It claimed umbrella body SARU was “at the centre” of its action – as first respondent – charging that it acted unlawfully in trying to “rid itself of Aerios for self-gain”.
Aerios maintains SARU applied “undue pressure” on Western Province Rugby (Pty) Ltd to release itself from advertising rights agreements dating from 2012.
There has been a lengthy, debilitating dispute, stretching back several years, between Aerios and the former company which ran WP Rugby’s commercial interests ahead of its controversial liquidation in late 2016 which Aerios regard as a “fraudulent plot”.
It was the subject of a lengthy Section 417 inquiry.
“Aerios believes, on the basis of the documents gathered in (the) three-year-long commission of inquiry, (that) it has sufficient solid evidence to back up its claim against the rugby executives,” CEO Costas Constantinou said in a statement to Sport24 earlier this week.
“Since 2016, a confidential commission of inquiry has been running … a document-gathering exercise, not a court action or actions as some journalists have claimed and misled the public about.
“Moreover, there has been no judgement: only recommendations and opinions provided by the commissioner to the Master (of the High Court) … it is these recommendations and opinions that will be dealt with in the courts.”
Constantinou said he wished to “set the record straight” over commercial rights.
“I want to state the facts regarding the matter of commercial rights in the realm of rugby in South Africa: despite some journalists labelling sporting commercial rights as a complex web, they are not complex at all.
“The fact is that in South Africa the sporting commercial rights undoubtedly belong to the independent rugby unions, and the unions are entitled to deal with them as they please.
“SARU must consequently compensate the unions if it wishes to deal in these rights or they must deal with a third party that the union (or company in the case of WP Rugby Ltd) has entered into an agreement with.
“To appreciate this arrangement, one must understand that SARU is not an independent commercial body: it is made up of an executive elected to their positions by the General Council, and (that) comprises representatives of all the unions in South Africa – SARU is essentially there to represent, not dictate, the interests of the unions.”
Constantinou added: “While it is true that the SARU executives are given the authority by the General Council to take certain commercial decisions that best serve them, SARU is not entitled to abuse this authority in the case of rugby commercial rights.
“While this matter is about a ‘David’ – Aerios – taking on the ‘Goliath’ that SARU believes it is in relation to its unions, it is also about protecting the rights of our unions to enter into sponsorship and commercial rights contracts independently of a Goliath intent only on muscling in on lucrative contracts with the overt intention of self-enrichment and riding roughshod over the unions in the process.”
In the statement, Constantinou accuses both SARU’s CEO, Jurie Roux, and the former chief executive of WP Rugby, Paul Zacks, of “reckless” conduct over commercial rights against the backdrop of prior agreements with Aerios.
“It doesn’t take much to imagine the devastating effect on the likes of Aerios if SARU were to blatantly ignore … legitimate rights obtained by Aerios and if it were purposely to undermine or on-sell those same rights … as if Aerios were expendable.
“And then to find underhand ways and means of ensuring that these contracts owned by a small company were terminated.
“So, contrary to what has been reported, and to put the record straight, it was certainly not the ‘relinquishing of the advertising rights’ that led (to) WPRU’s commercial arm folding at the end of 2016 … it was a liquidation orchestrated from within SA Rugby for purely self-seeking motives.”
Sport24 sent full copies of Constantinou’s statement to both SA Rugby and WP Rugby, but they declined in each instance to comment.
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