Memorandum submitted by The Rugby Football
Union
There are a number of compelling reasons to
minimise the black market in Twickenham Stadium international
tickets, the most important relating to the recruitment and retention
of rugby players and volunteers.
The RFU's invests considerable time and money
in an effort to reduce the black market, but there is unfortunately
little help within the existing legal framework. We very much
welcome the recent statements by DCMS that they are minded to
introduce protection for major sporting events. We hope the Committee
will support this position and recommend further protection in
the form of legislation that prevents all ticket touting.
While there are willing sellers with an eye
to a profit, we will not eliminate this market entirely. But we
could and should minimise sales in breach of the ticket terms
and make it more difficult for unscrupulous buyers and sellers
to operate.
The RFU distributes the bulk of its tickets
through its member clubs for the benefit of club members with
tickets for major international matches an important way of encouraging
players to play and volunteers to give up their time.
For a relatively small investment the Government
could provide a framework of support allowing all sports, including
rugby union, to reduce the black market and encourage participation.
A risky business
An estimated 4,000-5,000 tickets are available
on the black market for every major England international at Twickenham.
This is a substantial number when we have already taken out of
the market some 40,000 tickets to create an official licensed
operators scheme.
Clubs, of course, want to raise funds. The problem
arises when rather than finding genuine sponsors they are taken
in by spurious buyers operating under the guise of sponsors. These
are often fly-by-night hospitality operators packaging up tickets
which they sell on for something between £450 and £750,
depending on demand.
Black market tickets change hands either through
the traditional means of street selling, primarily a ticket only
sale, or through the Internet. There has been a major explosion
in the number of providers selling tickets or hospitality through
online auctions and this is a risky business for the consumer.
Unofficial purchases offer absolutely no consumer
protection for either an individual or a company. The packages
or tickets simply may not exist. The RFU frequently receives telephone
calls and emails from buyers who have parted with their cash only
to be let down. They insist that this is either the RFU's fault
or that the RFU should do something about it. If the tickets have
come from an unofficial source there is absolutely nothing the
RFU can do to help them.
RFU Investment
The RFU spends £50,000 per year on policing
the black market through advertising in the national press (appendix
1) and mystery shopping whereby the RFU buys sample hospitality
packages and tickets only and on legal fees. [1]We
also commit approximately 80% of the time of one in-house lawyer
to following up on sellers and the sources of tickets.
In addition, we have a number of people within
the RFU involved in policing and protecting the RFU against the
black market by: continually updating our ticket terms and conditions;
ensuring that full sets of ticket terms and conditions are sent
out with tickets and that recipients sign and agree to these;
investigating and dealing with those who breach the ticket terms
and conditions. Collectively, this probably equates to two full
time people.
The disciplinary officer of the RFU, HHJ Geoff
Blackett, a volunteer, also deals with approximately 20 appeals
a year from clubs and individuals who have been disciplined by
losing their ticket application.
In 2006 the RFU took legal proceedings against
a company called Westminster Hospitality and Events Ltd, who were
enticing people to breach the RFU's ticket terms and conditions
in order to run an unlicensed hospitality scheme.
Westminster was owned by an American parent
company called Razorgator, with whom we had many meetings during
some very lengthy legal proceedings. As we edged towards concluding
an out of court settlement, Razorgator took Westminster into voluntary
liquidation and the case ended with legal costs for the RFU in
excess of £500,000.
Black is Black
The black market is an emotive subject. Those
who can't buy a ticket always want to be able to obtain one, while
often being outraged by the price they have to pay. The cost to
the consumer usually delivers the middle man a substantial profit,
which is why they are in business.
The RFU has not lost any direct revenue because
it has sold the ticket to the primary purchaser at face value.
But many people within the sport find it difficult to obtain a
ticket and every ticket sold on is potentially a player or volunteer
lost. Tickets are priced by the RFU at a level which enables genuine
groups to go to Twickenham. Tickets are not priced to maximise
revenue in economic terms.
The secondary market only exists because of
unscrupulous third parties who spot the opportunity to make a
margin. If the RFU priced its tickets according to this economic
environment there would be no secondary market. That is the simple
law of supply and demand.
The RFU created an official hospitality licensed
scheme to: give some leeway to clubs who genuinely needed to raise
additional revenue and in order to ensure that the operators pay
a royalty fee for every package sold, which the RFU re-invests
in the game in the form of player insurance.
Damaging our Reputation
The reputation of the RFU is often brought into
disrepute by touts or unauthorised hospitality operators as often
consumers believe that they are dealing with official ticket sources.
Anyone knows a traditional street tout harassing the public is
not an official source of tickets. However, online operators are
often given credibility by the quality of the online web design.
eBay is a genuinely good business model providing
a great market place for people to buy and sell but the bedroom
tout, funding his or her own tickets through the sale of others,
has spotted an opportunity here. Thousands of tickets appear for
sale on eBay with probably 50-60% of them selling in small numbers
and for the "first time". There are however a large
number of sellers who will collect a large number of tickets together
until they have a reasonable stock to sell. Newer online auction
seats such as Seatwave and viagogo are specialist, hard to get
ticket suppliers.
The RFU works closely with the police on match
day in order to monitor ticket touting on the street and I attach
in appendix 2 a police report from the England v New Zealand match
from November 2006. [2]
What does the RFU want The Government to do?
In an ideal world, The RFU would welcome blanket
legislative protection as it has given to The Olympics which will
be held in London in 2012.
Realistically if broad legislation is not possible,
we would like to have the support from Government that will:
1. Assist the Police in preventing street
touting.
2. Prevent online ticket sellers selling
tickets that do not provide the ticket seat, row and block numbers
to buyers.
3. Prevent any online market places that
induce any contravention of Twickenhams ticket terms and conditions
from trading.
4. Insist on any market place to provide
seat, row and block numbers before any 3rd party can advertise
a ticket.
The RFU would welcome the introduction of protection
from ticket touting for national events, including major sporting
events such as those we stage at Twickenham.
June 2007
1 Not printed. Back
2
Not printed. Back
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