FIDE to Pein: it was all about Carlsen

by ChessBase
2/9/2011 – Last week the potential sponsors of the 2012 World Chess Championship, the organisers of the annual London Chess Classic, withdrew their two million Euro bid after negotiations with the World Chess Federation (FIDE) collapsed. Today the FIDE Vice President Israel Gelfer has undertaken "to provide the chess world with the correct facts which caused this move". Open letter.

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World Chess Championship 2012 – FIDE's answer

Open letter by FIDE regarding WCC 2012

A few days ago London declined to exercise the option to host the World Chess Championship 2012. Malcolm Pein commented in an open letter:

"Having secured the necessary funds, on July 21st 2010, CPL sent FIDE a formal offer and a detailed commercial contract to stage the next WCC match in London with financial terms similar to the 2010 WCC match at Sofia. Unfortunately agreement could not be reached in the autumn. Following more discussions in London in January, CPL asked FIDE to accept the offer by Saturday 29th January 2011. No such acceptance was forthcoming. Therefore, with regret, CPL has withdrawn its offer in time for the next Executive Board meeting which starts today in Turkey in order to give the EB clarity and the opportunity to consider alternatives. The timeline to stage a WCC match before the Olympic Games in May 2012 is now too short."

FIDE answered as promised after the Presidential Board meeting on the 4-5th February in Antalya, Turkey. Here is the full text of the open letter by Mr. Israel Gelfer.

Dear Malcolm,

I received the announcement of Chess Promotions that you are withdrawing your offer to organize the FIDE World Championship match (FWCM) with great disappointment. I would like to provide the chess world with the correct facts which caused this move.

On February 2010 FIDE granted you the option to organize the FWCM "under the same conditions like the Sofia match between Anand and Topalov". On 15 February you signed a memorandum accepting the conditions and regulations of the match and two days later paid a deposit of 50,000 Euro for such option.

After that, for a long period, you have been proposing several changes from the Sofia contract. In July 2010 (after the original deadline was extended by FIDE) you sent to FIDE a different version of the contract with different conditions. Foremost among this were important financial conditions which had to be clarified first. In a constructive manner FIDE, wishing to hold the match in London, accepted several conditions inter alia reducing the prize fund by 20% due to UK taxes not covered by the organisers, reduction of the contribution to FIDE, reduction of the number of principals. In January we met in London when I proposed to discuss the agreement based on the Sofia contract as amended above.

In our meeting both you and Mr. Andrew Finan replied that you only consider the version dictated by you, claiming that they are no substantial differences between the two contracts. You made it very clear, as you recall, that the sponsor of the match "lost interest" in it after the withdrawal of GM Magnus Carlsen and consequently instructed you "not to negotiate at all about anything" i.e. "take it or leave it".

Even after the meeting in London I was trying to solve the problems and I informed FIDE about the situation. The FIDE Secretariat then gave me a list of 36 differences between our version and your proposed contract and 16 changes from your original July draft. Many of which were completely unacceptable to FIDE, inter alia FIDE being responsible of player’s taxes in their respective jurisdictions, no liability for any cancellation for any reason and putting FIDE as responsible for several obligations which were and are not in FIDE`s hands.

Moreover, in your contract you change the regulations of the match. Furthermore you have informed us only on 27 January that the players may be liable up to 50% tax. This means that the net prize fund could be as little as near 1.2 million EUR after tax where as our agreement was that you will provide, as in Sofia, a prize fund of 2.0 million EUR after tax. Therefore your statement that the conditions were equal to Sofia was incorrect.

In order to try and solve the problems I asked for an extension of the signing date until the Presidential Bord meeting in early February. You were also invited by the FIDE President to come to Antalya so that we could try to reach an agreement. Unfortunately this proposal was rejected and you announced the withdrawal of your offer.

It is clear, and was obvious to me and expressed specifically by you, that the withdrawal of GM Carlsen from the WC cycle meant that the sponsor was no longer interested in sponsoring the match.

I regret that the FIDE World Championship Match, despite all our efforts, will not be organized in London in 2012.

Best regards,
Israel Gelfer
FIDE Vice President

Source: FIDE

Previous ChessBase report

London withdraws its 2012 World Championship bid
03.02.2011 – It was going to be a World Championship to remember: in the same location as the magnificent Chess Classics, for a prize fund of around two million Euros, tax prepaid. The potential organisers paid a € 50,000 deposit and gave FIDE until January 29th to accept or reject. Neither happened and today the sponsor formally withdrew his offer. Bad news.

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