This week, the World Cup kicked off amidst cheers and chants from the fans who had made their way to Qatar to watch the games. Although most fans chanted in support of their teams, Ecuadorean fans in one section of Al Bayt Stadium had a different message: “Queremos cerveza, queremos cerveza.” They want beer. Sadly for them, there is no beer to be had after the government in Qatar made a last-minute decision to ban sales at all World Cup stadiums.
If the fans from Ecuador are unhappy about the ban, imagine how unhappy Budweiser — who paid $75 million to sponsor the World Cup — must be.
Those of us who work on sponsorship agreements probably reacted to the news the same way — by wondering about what’s in the agreement between Budweiser and FIFA. Although we may never know the details, given Qatar’s history of tight restrictions on alcohol and the lessons that both sponsors and event organizers have learned after more than a year of COVID-related cancellations, it’s likely that the parties contemplated this possibility and addressed it in the sponsorship agreement.
When you’re negotiating a sponsorship agreement, it’s important to spend some time at the outset thinking about what will happen if an event is cancelled, altered, or you don’t otherwise get the benefits you paid for. For example, do you have a right to cancel the agreement? If so, what will happen to the money you’ve already paid? Or do you have the ability to get make-good benefits? If so, how will those be determined?
There isn’t a one-size-fits-all approach to these issues, but if you want some things to consider, grab a cerveza and listen to this podcast that we recorded earlier this year. Just don’t try to do that if you’re sitting in a stadium in Qatar. The podcast will still be here when you get back.