London withdraws bid for 2012 World Championship

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Stewart Reuben
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Re: London withdraws bid for 2012 World Championship

Post by Stewart Reuben » Wed Feb 09, 2011 6:37 pm

World Championship London 1986 resulted in over 100 programmes on TV spread over a few years. Organised at 6 months notice.
World Championship London 1993 resulted in many programmes on TV
World Championship London 2000 no TV coverage at all
There is an argument that London has had more than its fair share of the WC finals.
Adams was one move away from beating Kasimdzhanov in the knockout WC. Ray Keene was due to meet a potential sponsor/promoter the following day had he won.
Few of you will remember Hastings 1953 where Alexander beat Bronstein in 120 moves spread over 3 days. The game was given on the front page of the Daily Express. Nowadays to get a real buzz you need TV and that is needed to bring in new players. The web is quite sufficient for people who are already hooked on the game.

It is part of the rules that both players must agree to the venue. But if that was the only problem, it could have been awarded to London - subject to the approval of the challenger. It would hardly have been controversial. FIDE did want it in London in the year of the Olympic Games.
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Steve Rooney
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Re: London withdraws bid for 2012 World Championship

Post by Steve Rooney » Wed Feb 09, 2011 7:47 pm

Chessbase has published an open letter from FIDE on the situation which claims the withdrawal of Carlsen led to the London bid being withdrawn.

http://www.chessbase.com/newsdetail.asp?newsid=7006

Martin Crichton
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Re: London withdraws bid for 2012 World Championship

Post by Martin Crichton » Thu Feb 10, 2011 9:58 pm

an excerpt from a feedback email that I sent to one of the organisers is below....at least Gelfer's open letter throws a lot of light on the matter of some of the background politics.....

just had a quick read of Gelfer's response to the withdrawal of the London bid.... I am very sympathetic to Gelfer's letter for 1 main reason!
I was shocked to read that the organisers expected the players to pay taxes on their winnings in the UK especially if they are non doms (That was my interpretation anyway and correct me please if I got that wrong?)
One would imagine that they would have to account for their income in their own countries and many countries do not have tax agreements with the UK and in those instances one could end up being taxed twice! very unfair in my opinion...the solution would have surely been in the first instance to advertise NET prizes as opposed to GROSS prizes for the players?
Fischer had some pretty strong opinions regarding taxes... I doubt he would have played under such terms lol.
Last edited by IM Jack Rudd on Thu Feb 10, 2011 10:00 pm, edited 1 time in total.
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LozCooper

Re: London withdraws bid for 2012 World Championship

Post by LozCooper » Thu Feb 10, 2011 11:31 pm

martin crichton wrote:an excerpt from a feedback email that I sent to one of the organisers is below....at least Gelfer's open letter throws a lot of light on the matter of some of the background politics.....

just had a quick read of Gelfer's response to the withdrawal of the London bid.... I am very sympathetic to Gelfer's letter for 1 main reason!
I was shocked to read that the organisers expected the players to pay taxes on their winnings in the UK especially if they are non doms (That was my interpretation anyway and correct me please if I got that wrong?)
One would imagine that they would have to account for their income in their own countries and many countries do not have tax agreements with the UK and in those instances one could end up being taxed twice! very unfair in my opinion...the solution would have surely been in the first instance to advertise NET prizes as opposed to GROSS prizes for the players?
Fischer had some pretty strong opinions regarding taxes... I doubt he would have played under such terms lol.
I'm not sure it's very wise for FIDE to slag off a potential sponsor, they never know when they might want that sponsor in the future :roll: The idea that it was because Carlsen pulled out seems very questionable, the bid stayed in for 2-3 months after he announced he wouldn't take part. Sadly this appears to be the FIDE way :(

Thankfully the experience of trying to negotiate with FIDE doesn't appear to have done any long term damage and it appears we can look forward to more top flight events in England :D

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John Sargent
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Re: London withdraws bid for 2012 World Championship

Post by John Sargent » Thu Feb 10, 2011 11:43 pm

LozCooper wrote:The idea that it was because Carlsen pulled out seems very questionable, the bid stayed in for 2-3 months after he announced he wouldn't take part. Sadly this appears to be the FIDE way :(
I'm no staunch defender of FIDE, but (according to FIDE's response only which may be inaccurate, I don't know?) the reason the 2-3 months were there, in my interpretation, is simply because negotiations stalled. Pre-Carlsen not paritcipating, it seems that everyone was quite accommodating. Post-Carlsen withdrawal, negotiations continued but became extremely stringent from the side of Malcolm Pein (hence the 'take it or leave it' reference). I'm sure, especially given bureaucratic procedures in any large organisation such as FIDE, that 2-3 months 'lag time' is not considered significant.

Just my $0.02 - again not taking sides one way or the other.
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Justin Hadi

Re: London withdraws bid for 2012 World Championship

Post by Justin Hadi » Thu Feb 10, 2011 11:52 pm

That would be your £0.02, unless the Imperial event is taking entries in dollars?

The FIDE situation is interesting. Ultimately even if the worst of what FIDE allege is true, Pein can only be accused of negotiating, something the sponsor paid the $50,000 deposit to have first option on. Given the 20% FIDE tax and financial risk involved, it wouldn't be surprising if they had got cold feet when Carlsen pulled out, or even if he didn't.

Stewart Reuben
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Re: London withdraws bid for 2012 World Championship

Post by Stewart Reuben » Fri Feb 11, 2011 12:21 am

Mrtin Crichton >I was shocked to read that the organisers expected the players to pay taxes on their winnings in the UK especially if they are non doms (That was my interpretation anyway and correct me please if I got that wrong?)<

There have been taxes on foreign entertainers in the UK for many, many years. Foreign Entertainers Unit is the relevant body. Amazingly, when a booklet giving details of the tax was published it mentioned chess players alongside musicians and sportsman. The only time we have been given equivalence!

I think nothing has changed except possibly the rate of tax and the allowances. Anybody receiving £1000 or more has to pay standard rate tax (it may have gone up). They are allowed expenses against that such as a per diem of £90 per day. The normal thing to do would be to quote the prizes AFTER the tax has been deducted. The prize money would have to be £1.25 million for it to become £1 million at 20% tax. Some countries, such as the USA, have reciprocal tax agreements about this matter. Hastings follows this annually as did the BCF when the Commonwealth players took part in the British Championship.

Having paid tax in the UK, they would not again have to pay tax on the same sum in their own country, such as India. Of course, if their local tax was higher, they would have to pay the differential. Gibraltar is quite different and there is no tax liability.

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Roger de Coverly
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Re: London withdraws bid for 2012 World Championship

Post by Roger de Coverly » Fri Feb 11, 2011 12:25 am

martin crichton wrote:just had a quick read of Gelfer's response to the withdrawal of the London bid.... I am very sympathetic to Gelfer's letter for 1 main reason!
I was shocked to read that the organisers expected the players to pay taxes on their winnings in the UK especially if they are non doms (That was my interpretation anyway and correct me please if I got that wrong?)
That may be a question of current UK tax law and outside of Malcolm's control. There would be precedents from the 1986, 1993 and 2000 matches but these only involved Soviet and Russian players ( plus Nigel before he became Greek :) ). It's more than possible that tax law has changed since then.

I suspect it was just an issue to be aware of, rather than a show-stopper. Malcolm has never revealed his backers but they are believed to be "City of London". You might therefore expect the potential sponsors and backers to be familiar with UK tax concessions. Just a couple of thoughts - footballers (and presumably other high profile people) use the concept of "image rights" to direct earnings into a Company and thereby defer or shelter it from tax. Carlsen could have taken advantage of this given his RAW exposure. Anand too given his high profile in India. The other obvious one is to relocate the match to a friendly tax haven. The Isle of Man, Guernsey, Jersey and Gibraltar have all been chess-friendly venues but their possible tax advantages have never been exploited for high worth matches. (see Stewart's comment above)

Ian Thompson
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Re: London withdraws bid for 2012 World Championship

Post by Ian Thompson » Fri Feb 11, 2011 9:25 am

Roger de Coverly wrote:Malcolm has never revealed his backers but they are believed to be "City of London".
ChessBase has though. According to them, he's a partner at an investment management company. He's certainly involved with chess because his resume says he's "... involved in making chess ... more widely available in schools in the UK."

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John Sargent
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Re: London withdraws bid for 2012 World Championship

Post by John Sargent » Fri Feb 11, 2011 10:42 am

Justin Hadi wrote:That would be your £0.02, unless the Imperial event is taking entries in dollars?
Not 100% sure the phrase converts well betwen currencies, but for you Justin, as long as the Hippo or Hippo-On-Heat is played in every round, I'll happily accept payment in dollars :lol:
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Justin Hadi

Re: London withdraws bid for 2012 World Championship

Post by Justin Hadi » Fri Feb 11, 2011 10:49 am

You have blown my secret preparations, I'm not sure I can play now.

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John Sargent
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Re: London withdraws bid for 2012 World Championship

Post by John Sargent » Fri Feb 11, 2011 11:10 am

Justin Hadi wrote:You have blown my secret preparations, I'm not sure I can play now.
Okay, okay. Pesos.

London's bid is falling down, falling down, falling down,
London's bid is falling down, Carl's not playing...
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Justin Hadi

Re: London withdraws bid for 2012 World Championship

Post by Justin Hadi » Fri Feb 11, 2011 11:35 am

John Sargent wrote: Okay, okay. Pesos.
Deal.

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