CricTracker Exclusive: Investors are already scared to invest in Afghanistan, says official after ACB's contract breach with Snixer

Afghanistan Cricket Board (ACB) has found itself in troubled waters. Snixer Sports, the company which had acquired the rights of Afghanistan Premier League (APL), has filed a lawsuit against them in London Court of International Arbitration (LCIA) claiming 15 million dollars. APL 2018 had witnessed a lot of international stars making their presence felt and the fans were waiting eagerly for the second edition.

But the ACB postponed the 2019 season stating that Snixer Sports didn’t pay the complete rights fees for the inaugural edition. The board also cited concerns over the integrity of the people associated with its partners and also terminated the agreement.

“The failure by Snixer Sports to pay the complete rights fees of the first edition as per the fees and payment schedule of the agreement, and concerns about risks for integrity of the league posed by people connected to Snixer Sports are the reasons for termination that form material breaches of the agreement,” the ACB had said in a statement.

However, Snixer Sports has now come out strongly against all the allegations claiming the lawsuit in LCIA which is one of the highly reputed forums in the world. A report in the Dawn stated that the ACB was happy that they claimed as Snixer owes them the dues. However, the official close to the developments, while speaking to CricTracker, felt that the ACB might have to face the repercussions for their stubborn stance in this case. He also highlighted the fact that the investors are already not interested to invest in Afghanistan and ACB’s behaviour doesn’t help either.

“You have to be depraved and deranged both legally and factually at a different level to make that statement. If this statement goes before the court, may God save them. Because they’ve signed before a court saying that if there is any dispute, we recognize the jurisdiction. If you are making this statement, it has diplomatic repercussions. Investors are already scared to invest in Afghanistan in today’s time and then if you make such statements, then only God can save them,” the official, on the condition of anonymity said.

What was the actual agreement?

ACB has claimed that Snixer Sports has failed to pay the complete rights fees to them according to the schedule of the agreement. CricTracker tried to dig in deep and know about the agreement and the process followed ahead of the APL 2018 when the Memorandum of Understanding (MoU) was signed.

Actually, ACB was looking for companies who will take all the risks and the board persisted that they will not even bear a single penny from their pocket but will be a party to the 51% of the profits made. Agreeing to these conditions, Snixer Sports came forward and an MoU was signed before officially announcing the league. While the APL 2018 was exceptional in terms of cricket, on market front, it suffered huge losses.

“In terms of exposure, it (APL) went well.  In terms of coverage, it went well. In terms of providing scope to the cricketers, it went well.  But if you look in terms of investment, that didn’t go well. Because any league, specifically with smaller South Asian countries, except India – IPL is a different story altogether, needs to be conducted 3-4 times before you get the visibility and the investors in the international market. So the investment was close to 9 million USD and the revenue generated was only 1.2  million USD.

“What Snixer hoped was that they will continue with the league for over a period of three-four years and then they will start making profits. So the license they got from ACB was for six years to conduct APL,” the official said. However, the six-year agreement was terminated after the first edition as, according to the ACB, the Snixer Sports didn’t pay the required fees as per the schedule of the agreement.

ACB footed bills to Snixer out of the scope of APL, claims official

When the official was quipped about the same, he explained the whole situation. Snixer has paid 4 lakh USD to the ACB and are left to pay only 2 lakh USD according to the agreement. But the official claims that the Afghanistan board is asking them to pay 3 lakh USD for the expenses unnecessarily.

“The agreement says that Snixer will pay 6 Lakh USD out of which 4 lakh USD were already paid to ACB. And all the expenses, starting from a minor water bottle to chartered flight expenses everything were to be borne by Snixer. So Snixer said that only 2 lakh USD are pending, so take it from us. Instead what ACB did was, they conducted some parties and everything from their end. They took the VIPs for tours to Dubai etc… And they footed those bills to Snixer.

“For eg. They went for Zimbabwe U19 WC qualifier. They sent that bill to Snixer as well to pay. So it was kind of extortion because once they realized that Snixer has already invested 9 million USD through its investors and now they are stuck, so they will have to listen to us for next 6 years if they want to make any profits. So they started demanding 3 lakh USD extra.

“Snixer then cleared that they won’t be paying that amount and will only pay whatever they are liable to in the agreement. According to the agreement, Snixer was liable 2 lakh USD more. Over the remainder of the amount, they just asked to show invoices, the legitimate billings, and their approvals before going ahead with the expenditure in order to pay them the amount.

Rather Snixer also put forth a proposal in front of the ACB but the board was adamant on getting the money first before holding any talks. “Snixer also gave an option of putting the money in an escrow account and asked the ACB to carry on with the second edition of the league until that is disputed. And offered them to take the money once the dispute is settled. But Snixer requested them to take remaining 2 lakh USD from them for the time being. So that was the entire proposal on behalf of Snixer which ACB denied saying that they will only proceed after taking the money.

What about the ‘integrity’ comment from ACB?

ACB, in its statement, while terminating the agreement, had questioned the integrity of the people associated with Snixer Sports. During the APL, certain players were approached for fixing and one of them was Mohammad Shahzad who reported the approach as well. However, according to the official, there is no proven misconduct against any Snixer official and the ACB has used the ICC Anti Corruption Unit’s (ACU) routine exercise to terminate the agreement.

“That was actually a very rubbish allegation. There was some guy by the name of Gajanand who gave an interview and alleged that there are match fixings and corruptions everywhere in APL. Any league which is sanctioned by ICC, routinely ICC ACU comes in which is headed by Alex Marshal. They come in and question in this case. When an allegation is raised, the ACU will inquire each and everyone who is involved in the conducting of the match, the organizers, the cricket board, the officials, the coaches everyone. It is a very routine exercise.

“There is not a single iota of proven misconduct against Snixer or anyone. Even then Snixer said out of goodwill that even those who have been questioned, they will ask them to step down from the board if it is affecting ACB’s image that much. For any match that happens, the license holders like Snixer, they don’t fall under the rules of the ICC ACU. It is the country’s cricket board that falls.

“ACB said they have feedback which they cited in the termination letter as well. Over multiple communications, Snixer asked them to show the feedback. In fact, Snixer approached ICC asking them if they have any evidence of misconduct. Even ICC said that they don’t have anything against Snixer. They said we have only questioned as a routine. The report is yet to be made. It is a routine exercise and ACB have used it as an excuse to terminate the agreement which is invalid as well,” the official further said.

What next in this case?

Now that the lawsuit has been filed in LCIA, the ACB will have to respond to the notice sent to them within a certain period of time. The official informed that a proper legal process will be followed now where the judges will see what the dispute is and how much money needs to be awarded. Snixer, if they win the case, will also have an option to go against any third party which will join hands with the ACB in the future if the board refuses to pay money to them.

“It’s a proper legal proceeding known as arbitration which will happen. And the judges will see what the dispute is and how much needs to be awarded. Snixer claimed 15 million USD…may be during the proceedings, it might be cut short a bit as well. According to International commercial rules, ACB will be liable to pay 18% commercial interest as well over the amount.

“If ACB doesn’t pay this amount, then under garnishee, Snixer will move against the third party which is supposed to pay ACB. We can take a garnishee against any other investor who is coming into invest in ACB saying that they owe us money as per particular judgments of LCIA. Now since they are not paying,  you have to pay,” the official signed off.