More than a game: legal risks associated with FIFA World Cup

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Summary: Behind the FIFA World Cup's global appeal lies a complex legal landscape affecting sponsors, contractors, employers and investors. This article explores the key commercial and legal risks associated with the tournament and highlights the practical steps businesses can take to protect their interests.

Every four years the FIFA World Cup captivates billions of viewers worldwide, but behind the spectacle lies a complex web of legal and commercial risk. Each tournament generates significant commercial activity, from infrastructure and construction projects to sponsorship deals, broadcasting rights and employment arrangements. For aspiring lawyers, understanding the legal challenges that arise before, during and after a World Cup offers a valuable lens through which to develop commercial awareness. This article explores some of the key legal issues global businesses face in connection with the tournament and highlights practical considerations for companies navigating them.

Commercial focus

World Cups generate enormous commercial activity across host nations, and with that comes a wide range of legal risks for the businesses involved. Companies operating in and around the tournament should be aware of the following key areas:

• General contractual risks: The staging of a World Cup generates a wide array of commercial contracts covering hospitality, ticketing, logistics, equipment supply, broadcast production and event management among others. Such agreements carry an inherent risk of issues arising, particularly given the high commercial stakes involved, the competing interests at play, and the unpredictable consequences that can flow from tying a commercial arrangement to an event of this nature. Non-performance, payment failures, and force majeure claims all frequently arise in practice. To manage these risks, FIFA’s commercial contracts commonly include multi-tier dispute resolution clauses providing for negotiation, followed by mediation, and ultimately arbitration, and the enforceability of such clauses is well established in most jurisdictions. For businesses, the choice of governing law and dispute resolution mechanism at the outset of a commercial relationship is critical to ensuring that any issues can be resolved efficiently and with certainty.
• FIFA IP protections: FIFA’s strict IP restrictions play a crucial role in safeguarding the commercial interests of official sponsors during World Cups. These protections ensure that sponsors receive exclusive commercial rights, allowing them to associate their brand with the event without interference from unauthorised entities. FIFA enforces these rights through legal measures against piracy and unauthorised use, including trademark enforcement, licensing controls and anti-counterfeiting actions. A key area of risk for businesses that pay to associate themselves with the World Cup is ambush marketing, where brands attempt to associate themselves with the event without official sponsorship and without paying the significant associated fees. Brand marketing strategies often straddle a fine line between creative association and infringement of FIFA’s IP. Should brands miss the mark, legal repercussions are a real risk. Companies planning marketing campaigns around the World Cup should therefore take care to understand the boundaries of FIFA's IP protections and seek legal advice before launching any campaign that references or alludes to the tournament.
• Sponsorship risks: Due to the various stakeholders involved in hosting a sports tournament, sponsors should be alive to regulatory changes and other potential pitfalls (such as unwanted media, which can damage sponsors’ reputations). A notable example occurred when alcoholic drinks were banned in stadiums in Qatar during the 2022 World Cup whilst Budweiser was a major FIFA sponsor. To mitigate these risks, sponsors should ensure that the tournament they’re sponsoring aligns with their values and that they have robust contractual protections in place, such as rights to termination on reputational grounds or specific misalignments, as well as potential indemnities covering losses arising from such risks.

Infrastructure and construction focus

Hosting a World Cup requires significant investment in infrastructure, from building or upgrading stadiums and training facilities to improving transport networks and accommodation. These large-scale projects attract a wide range of commercial participants, from multinational construction firms and engineering consultancies to materials suppliers, logistics providers and the investors that finance them. Due to the complexity of building or renovating infrastructure and the time pressures involved, delays and budget overruns can cause a strain on local resources and expose contractors, developers and their supply chains to substantial legal and financial risk.

This was apparent during both the South Africa and Brazil World Cups, where missed deadlines and delays seemed to be a common theme. Delays were also reported in the lead-up to the Russia and Qatar World Cups. Businesses involved in World Cup infrastructure projects should ensure that their contracts contain clear provisions addressing delay, cost overruns and the allocation of risk, including appropriate liquidated damages, extension of time mechanisms and force majeure clauses. Where institutional arbitration is the chosen dispute resolution mechanism, Dispute Adjudication Boards are commonly employed as a first-tier mechanism providing real-time determinations during the construction phase, with parties retaining the right to refer unresolved matters to arbitration.

Employment and labour focus

Employment-related issues during FIFA World Cups have drawn global attention. In the lead-up to the Qatar World Cup, for example, a landmark case involved Qatari Diar Vinci Construction, a joint venture including Vinci Construction, in which France’s highest court upheld an indictment over abusive labour practices. For businesses operating in host nations, this underscores the importance of conducting thorough due diligence on labour practices across their operations and supply chains, and ensuring compliance with both local and international labour standards.

Employment-related risks also extend beyond manual labour, as athletes themselves are workers and their employment rights have increasingly come into focus. Issues such as contract disputes, freedom of expression and fair compensation are increasingly prevalent. Under the FIFA Regulations on the Status and Transfer of Players, employment disputes between players or coaches and clubs are typically channelled through FIFA’s Dispute Resolution Chamber or Players’ Status Committee as a first-tier tribunal before any appeal to the Court of Arbitration for Sport (CAS). For businesses with commercial interests tied to players or clubs, these proceedings can have knock-on effects on endorsement deals, image rights agreements and broader commercial arrangements.

Key legal takeaways for businesses

• Courts and governing law: Due to the international nature of commercial contracts surrounding the World Cup, often involving companies from multiple jurisdictions, governing law clauses will often be heavily negotiated. Businesses should ensure they agree on a jurisdiction with reliable courts and enforcement mechanisms, as this will be critical to resolving any issues that arise and facilitating enforcement of judgments and awards.
• Arbitration: There are significant benefits to agreeing to arbitration clauses in commercial contracts, especially for cross-border arrangements surrounding World Cups. Multi-tier clauses, providing for negotiation followed by mediation and then arbitration, are common in FIFA’s commercial contracts, and awards rendered under such frameworks are enforceable in over 170 jurisdictions under the New York Convention (1958). Arbitration is also the primary mechanism used to resolve on-the-field or sports-related issues, with CAS holding ultimate authority in many cases. For 2026, CAS has adopted bespoke Arbitration Rules covering disputes under Article 50 of the FIFA Statute. The Ad Hoc Division must render decisions on an expedited basis (within 48 hours of lodging), with those decisions immediately enforceable and not subject to appeal.
• Class actions: Where large numbers of individuals are affected, whether workers, fans or other stakeholders, issues have the potential to escalate into class actions, presenting significant financial and reputational exposure for the businesses involved.
• Local laws and regulations: Businesses entering into commercial agreements in host countries should seek advice from local counsel at an early stage. This will help mitigate unnecessary legal risks and ensure that commercial arrangements remain enforceable after the World Cup. Multinational firms should also consider the broader regulatory landscape when operating in host nations, including foreign investment restrictions, anti-bribery and anti-corruption obligations, and sanctions regimes that may affect the structuring and enforcement of commercial arrangements.

Lucca Rolim is an associate in the corporate division at Herbert Smith Freehills Kramer LLP.