Draft of Proposed agreement between FIDE and FIDE Commerce PLC
Thank you for faxing me a draft copy of the proposed agreement with FIDE Commerce PLC.
This photo was taken by Sam Sloan during the FIDE World Chess Championship in Las Vegas
I have serious problems with the draft document please realize that the following comments are intended to be constructive.
Firstly, it must be recognized that FIDE's image in the chess world is very low with major problems having been experienced in the past year with the planning and implementation of the World Championship, the Women's World Championship, the Women's World Knockout Championship, the 75th anniversary celebration in Paris, the rating system and communications in general. In addition, neither Kasparov nor Karpov are supportive of FIDE although one of President Ilyumzhinov's election planks was that he was a friend of both and he would therefore have a good chance of resolving this conflict.
These problems raise the question as to whether FIDE has the personnel resources to properly manage its affairs.
In respect to the document that you faxed I must say that my overall impression is that it includes a lot of "fluff" and requires a lot more "meat".
The financial section gives one serious concerns
Item 1c on page 2 would seem to infer that 55 million dollars would be returned to the World Chess Foundation before any profit would be available for distribution. If this is true, it is doubtful if FIDE would receive anything. Item 1c goes on to state that any surplus would be split between the World Chess Foundation and FIDE. This seems to be in conflict with item 1d which shows 70 % of net profit going to the World Chess Foundation and 30% to FIDE Commerce PLC with no mention whatsoever of FIDE.
The document states that arrangements have almost been concluded for an international chess magazine for FIDE and for TV programs on chess and goes on to state that more than $500,000. has been spent on developing these projects. This of course raises a number of questions exactly how was this $500,000. spent presumably this was Artiom Tarasov's personal money? Does he expect to be recompensed for this amount? We already have FIDE Forum which is an excellent publication although it has not been published for many months another publication is unlikely to be financially successful the very fine "Inside Chess" has stopped publication which gives you a good idea as to how likely a new publication might succeed.
Item 4 on page 4 refers to annual organizers' meetings we already have this what is anticipated to be different about the new meeting?
Page 8 refers to the difficulties experienced in Las Vegas with transferring prize money to participants. This does not enhance the document. It is very painful to FIDE but we must admit that cheques were written without money in the bank.
Page 9 refers to rating everyone with a rating of 1500 and up this may be fine and may be well accepted but there is no mention of cost to FIDE or charges to individual federations for this service.
Page 9 also refers to a subscription to FIDE Forum magazine for everyone with a FIDE Club card again, this would come at great cost and it is doubtful if all chess players would want this publication if it cost them money.
As to Visa credit card payments, most individuals already have their favorite bank Visa or other credit card and it is doubtful if many would use their FIDE Club visa card as a Visa credit card payment instrument.
I am not sure that the World Chess Foundation should be mentioned at all in this document. I recall President Ilyumzhinov saying that his only problem was which of his foundations to take the world championship prize fund from. If it is to remain part of the agreement there needs to be clarification as to what it is and what its role is.
I believe the document needs a projected time frame including a projection year by year of income by source, expenditures by category and positive or negative yearly balance. This is very, very important and a "must" in my opinion if anyone is to get a true understanding of what is being proposed. We also need a financial model to track and compare actual progress with.
I trust that these comments will be of value.
Phil Haley; Zonal President and FIDE representative, Canada
cc: Pedro Barrera
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