The indictment of FIFA officials by a U.S. grand jury said that an unidentified sportswear company "bribed" a Brazilian football official for a sponsorship deal -- a deal that "seems to mirror one obtained by Nike," according to Townsend & Panja of BLOOMBERG. The indictment "refers to a U.S. company that signed a partnership" with the Brazilian Football Federation (CBF) in '96. Nike, based in Beaverton, Ore., "announced its decadelong pact with Brazil that year." In a statement on Wednesday, Nike said, "Nike believes in ethical and fair play in both business and sport and strongly opposes any form of manipulation or bribery. We have been cooperating, and will continue to cooperate, with the authorities" (BLOOMBERG, 5/27). In London, Joe Leahy reported on hearing the news of the FIFA arrests, former footballer turned Brazilian Congressman Romário tweeted, "Unfortunately, it wasn't our police who arrested them." The "guilty plea" of José Hawilla, the owner & founder of Traffic Group, the sports media company that "virtually controls the business of the sport" in Brazil, struck "at the heart of the nation's powerful football hierarchy." In a '10 interview, newspaper O Globo described the businessman as "The owner of our football." One of his most "far-reaching achievements" came in '96, when he "claimed to have brokered an agreement" between Nike and the CBF, making the sportswear company the major sponsor of the Brazilian national team (FINANCIAL TIMES, 5/27).
A BRIEF HISTORY:
FOLHA DE SÃO PAULO reported the CBF is "accused of corruption in commercial agreements," as well as "bribery payments in relation to contracts" of the Copa do Brasil. The partnership between the CBF and Nike, which was made under former CBF President Ricardo Teixeira in '96, was "announced as the largest in football history." However, this first "power demonstration quickly became controversial." For $160M in the first 10 years of its contract with Nike, the CBF "gave up the right" to choose opponents for the Brazilian national team. A contractual clause in the deal gave Nike "the right to choose locations and opponents for Brazil in 50 matches over a 10-year period to promote its brand." Another "required the use of at least eight top athletes" in friendlies. A new contract, signed in '06, "excluded games organized by the company." Nike directors "affirmed that these clauses should not be valid in the contract renewal" (
FOLHA DE SÃO PAULO, 5/27).
