Attention : Chairperson
Portfolio Committee On Sport And Recreation
15th September, 2000
Re: Our Meeting On September the 12th, 2000, Refers:
As per your request at the abovementioned meeting, please find attached some of the recommendations already presented to yourselves as well as some further recommendations we would like present.
Section 29
Broadcasting Rights Of Tournaments:
We strongly believe that we should remove the above section for the following reasons:
1) As is familiar to yourselves, your proposed draft bill is mainly based on BTT resolutions which took place at the National Boxing Convention in East London in 1998.
The main resolution at that Convention was that negotiations regarding TV rights being held between broadcaster and promoter.
2) As is familiar to yourselves via the public media in the past month, boxing’s reputation has been badly damaged and one of the reasons was the involvement of the Commission’s involvement in the allocation of TV dates as well as the major issue in Apartheid days, that the Commission’s were handling TV rightsfees of the promoters.
One can imagine what a disaster is will be if above power ends up in the wrong hands, as experience showed in December, 1999, when boxers in a tournament incidentally staged by myself, were not paid for seven months after the tournament.
The highly publicized incident totally destroyed the image of the sport both at home and abroad.
3) We would take the liberty to also point out to yourself the fact which is even familiar to the Ministry, that some Commissioners were getting back handers from the promoters for the favour of allocating TV dates, as well as the fact that some Commissioners are involved in the management of certain boxers.
4) We should follow the worldwide example of most credible Commissions, such as the British Boxing Board and the Nevada State Commission, where the most important role of the Commission is to protect the boxer medically, financially and by all other means.
5) The most important point for removing Section 29 of the new Draft is that in this way, we are taking away the democratic and constitutional right from the boxer himself to choose who his promoter will be.
6) We would not even go in to any further details of asking ourselves from where Boxing South Africa will obtain the necessary finance to promote the tournaments and what they will be doing with the TV rights allocated to themselves.
7) Exclusivity Of A Channel For Use By Specific Promoter:
The above issue has become the major problem in the South African Boxing industry for the following reasons:
a) We would take the liberty to point out that the above practice is pure discrimination for the boxer himself in that we have in this country (17) national champions, who are all equal by all accounts, except the purses earned or amount of fights in which they are involved annually.
While the South African champion on Topsport fights once a year for a ridiculous amount of money, the very same champion on M-Net’s Supersport fights 4 times per year, for three – times the amount of money.
The reason being, the huge differences in the budgets of Topsport (SABC) and Supersport, enabling the latter to pay higher rightsfees.
The fact that SABC Topsport have the excuse that they do not have the budget for world title fights and they are only staged by Supersport, will lead you to conclude that it is very damaging, not only to the boxers, but the entire industry in South Africa.
This inevitably leads to a situation where hardly any South African champions are afforded the opportunity to fight for world honours, which will bring them and their families financial stability, but also the good image and reputation to South Africa as a country.
As you are aware, I am the internationally acclaimed promoter and trust me when I tell you, that no broadcaster in the world, including the biggest ones, HBO, Showtime, Sky, TVKO, ESPN, Eurosport or any others, have any exclusivity with any promoter.
They all buy the quality product and the best product demanded by the viewing public.
The fact that in South Africa, we have nothing less than 68 licensed promoters (figure quoted last year) and that 67 of them are with one broadcaster (SABC Topsport), who stage on 24 tournaments per year and that on Supersport there is only one promoter, is the main reason why we have a major problem of the "Big" and "Small" promoters, a situation which will have to be overcome.
I am personally in the boxing industry in this country regarded as a "Big" promoter, but I do not believe in the distinction being made between the "Big" and "Small" promoters. The reason being, that in a new, democratic society such as South Africa, we all should be the same.
In this case, it is our democratic right to have equal access in this case, to all available broadcasting in this country.
b) SABC – the major setback for boxing in this country was two years ago when the above broadcaster reduced from 48 tournaments to just 28 per year, the reason being, according to them, a bad financial situation.
For the same reason, they refused to buy from the promoter, world title rights in or outside of the country, saying that the promoter must pay them (the broadcaster) production costs in the range of R80 000-00 and all expenses pertaining to the tournament to be covered by the sponsor, who must be supplied by the promoter.
Experience has shown that the sponsors who are introduced to the broadcaster by promoters, are actually at a later stage "Stolen" from the promoter by SABC Topsport, who immediately conclude an exclusive contract between themselves and the sponsor.
Cases in point are Ellerines and King Korn.
One would wonder how to explain the fact that for the past 3 years SABC Topsport did not increase TV rights by a single rand, saying that they do not have the money, but only 24 hours after the promoters meeting with parliament, I received a letter that the TV rightsfee for my next tournament had been increased from
R65 000-00 to R70 000-00. The only explanations can be as follows:
Another exception was made two years ago by SABC Topsport when they decided to take from the promoter, his rights to branding of the ring for advertising purposes and instead of the promoter having the mat, ring and 4 cushions for his personal sponsor, he was left with just 2 ring cushions and the mat and the remaining 2 cushions sold to the SABC sponsors for a fee.
Once again, looking at worldwide trends, you will find no broadcaster who takes from a promoter ring branding, sells it to someone else and then pockets the money.
The above example is nothing more than forcefully taking someone else’s product (the promoters) and keeping the benefits for themselves.
Even M-Net Supersport does not have this odd practice in South Africa.
We understand that SABC budget is not very large, considering reports in Business Day that Topsport and SABC had actually made huge profits in the last year.
It is by no means our intention to be at all confrontational with SABC Topsport, but if they are unable to raise the rightsfees paid to promoters, then it is only right that they return the privilege to personal sponsorships and branding of the full ring – our right for many years – into the hands of the promoters.
This would then enable us to stage better quality tournaments and fights.
We have nothing against SABC Topsport supplying their own broadcast sponsor, but in return for sponsor’s money, they should at least offer him commercials between rounds and not try and score on the branding of the ring as well as for their benefit.
If you consider the fact that boxing is the 2nd most popular sport in the country, and the fact that SABC Topsport pays millions in TV rights to screen other sports, casts doubts once again of Topsport’s supposed bad financial situation.
As the broadcaster, they should be buying the products from the promoter and not selling it in turn to someone else.
In addition, the promoters servicing SABC Topsport are the only example worldwide who do not have the right to sell the tapes of their own fights / tournaments to overseas broadcasters.
In closing of the above issue, what does SABC Topsport do with the sponsorship money from King Korn, Ellerines and Bull Brand, if one considers that those rights sold are in the range of R140 000-00 and the promoter is only paid a TV rightsfee of R65 000-00?
In addition to that, are the other sponsors who buy commercial time during the boxing televised tournaments because of the exposure gained on prime time TV, also pay money for that slot?
Section 30
Registration And Issuing Of Licences To Promoter:
Beside the fact that every individual, male or female, has the democratic right to apply for a promoter’s licence and that right can not be taken away from him / her:
Once again, we must consider the financial and medical protection of the boxers when it comes to the above.
All of you respectable MP’s would remember not so long ago, it was the case when the promoter was unable to pay the boxer for their services.
For that reason, financial situation of a promoter must be carefully considered. Surely, you will agree that it is not only money that one needs to become a promoter, but also skill and experience, which does not just come overnight.
For the above reasons, we would suggest 3 different kinds of licences when it comes to promoters.
a) Licence for Beginner Promoters (Development Tournaments) with a low budget. Licence fee to the above promoter should be set at the minimum.
b) Promoter Licence for staging of Medium magnitude fights (e.g. South African titles) which will require greater skill, experience and budget than licence (a). We would suggest that after two successful years of promoting under licence (a) where skill, experience and budget improve, he should be examined / considered for licence (b). Licence fee to commission should be higher than in Licence (a).
Licence for staging big International / World Title fights should be issued to the promoter who has had licence (b) for a successful two years. Reason being that Licence (c) requires maximum skill, experience and budget.
With the above categories, we will not have sleepless nights when it comes to the payment of our boxers and cancels any possibility of exploitation arising.
We also strongly recommend that for any of the above licences, in the case of a promoter failing to meet the criteria or supply financial records, to be suspended for a minimum of six months and automatically relegated to the lower grade of licensing, where he can meet the criteria required.
In the case of the licensee failing in any criteria twice, his licence should permanently be revoked.
21st September, 2000
Re: Continuation Of Our Recommendations To The Boxing Draft For
New Boxing Act – First Part As Per Fax Of 18th September, 2000
Chapter 1 (Section Q) – Recognition Of International Boxing Bodies / Organisations And Their Representations In South Africa.
One has to be very selective when it comes to the above, especially after reports in recent months in the public media of the possible bankruptcy of the WBU, as well as racketeering in the IBF and the laundering of money.
We would strongly suggest that any boxing organisation with a record like the abovementioned, should immediately be banned in South Africa as well as in the case of any boxing organisation trying to dictate to the BSA, should also not be permitted to operate in this country.
Boxing organisations should stop hand – picking their own people in South Africa and no individual not involved in the BSA should be involved in the affairs of any Boxing Organisation.
Charter Two (Clause 22 {1}) – Provincial Offices Of Boxing South Africa
We fully agree with your recommendation that a Provincial Office consists of one representative appointed by the Minister, and not like the current situation, where provincial commissions have up to 10 members, all with their own individual agendas.
Section 22 (5)
We agree as you as you proposed, that the representative of the Provincial Office, holds office for a period not exceeding 3 years, but we would strongly suggest that his position be reviewed on a yearly basis, with the power given to Boxing South Africa and the Minister to review the position at any other given time on the basis of non – performance or incompetence.
Clause 24 (B) – Powers And Duties Of The Provincial Office
We fully support your recommendation that the Provincial Office must carry out at all times the instructions and directives of the BSA.
Clause 30 – Registration Of Licensees
We notice when it comes to the above, that somehow you have left out registration of agents. We would like to point out to yourselves that agents play a very prominent role in the life and careers of boxers and should definitely be registered by the BSA so they can be controlled especially as history shows that agents have endangered boxers’ lives and finances in the past.
Clause 36 – Protection From Exploitation
1) In the promotional agreement between the boxer and the promoter, the minimum fights per year must not be specified as you suggest, but also the minimum purse money the boxer is to receive per fight.
2) We would strongly suggest that the promotional agreement should be extended from 12 to 36 months. The reason for doing so, besides being a world wide practice, is that the promoter invests time and finance in building up a boxer in the first two years and can expect only some return in the third year.
In case of another promoter showing an interest in a boxer under another promotional agreement, the 2 parties should negotiate a settlement and try to avoid lengthy legal battles.
Clause 37
We fully agree with your recommendation that the promoter of a champion should not require from a mandatory title challenge any promotional rights, but, in addition to that, as is world wide practice, if the challenger is voluntary, and not mandatory, we should grand to the champion’s promoter the right to three defences if he becomes the champion.
In this event, the promoter will be able to cover his financial loss incurred by losing a champion.
Branco Milenkovic
Managing Director