Sports federations are privileged in Switzerland

05.04.2013

International sports federations have been enjoying a lot of advantages being clustered in neutral Switzerland, but there is growing concern over the country’s image after recent corruption scandals, not least in FIFA. In this video and text interview Ph.D. Candidate Michael Mrkonjic from the Swiss Graduate School of Public Administration discusses the connections between Switzerland and sport.

Video interview with Michael Mrkonjic (click to watch)

This interview is an edited version of an original full length video interview with Michael Mrkonjic:

What are the main advantages for sports organisations settling in Switzerland?

"First of all, it is important to know that Pierre de Coubertin decided to settle the IOC in Lausanne in 1915 during the First World War, and the argument behind this was that Switzerland had political and militarily neutrality. Then many international sports federations came later on knowing that the IOC was based in Switzerland, and they found a legal framework that was quite flexible for their activities. 

The Swiss Civil Code provides some guidance on how the organisation should be structured, how they should have their statutes, but it is quite flexible for them to develop their activities. Later on we have also the fiscal argument because the Canton of Vaud in particular, where many international sports federations are located, offers different privileges to international sports federations because they have a public utility.” 

What sorts of concrete benefits does Switzerland offer in comparison to other nations? 

“There is no single reason that explains why they are there, but many factors: Benefits from a fiscal perspective, benefits from a legal perspective and also the creation of different relationships between sports federations. Since 2006 Lausanne has built an infrastructure for international sports federations called ‘La Maison du Sport International’ (International House of Sport) where different federations can exchange knowledge and develop relationships.”

And until recently corruption in business life was not regarded as strictly as it is today? 

“Switzerland is a kind of island in the middle of Europe with some political and military neutrality, also in regard to financial activities. Until 2000 corruption and bribery in business were tolerated, bribes were even deductible from tax. But the Council of Europe, the European Union and UNESCO started to develop conventions to fight against corruption and said that Switzerland should modify its law regarding corruption in this respect.”

Still, there are discussions about FIFA and other sports organisations involved in different sorts of scandals. What is the reaction in Switzerland when it comes to a stricter control of international sports organisations? 

“The fans want to see a clean game and are mostly concerned with what is happening on the pitch. For instance, doping might be a matter for them. But for politicians the image of the country is important. If Switzerland is hosting corrupted organisations, it is bad for its image, so they want to do something to prevent these federations, for instance FIFA, from acting in a corrupt way.  

So you have several parliamentarians who have raised questions about what the role of Switzerland regarding those federations really is. Should we let them develop their activities even if they are corrupted or do something? They noticed that the law regarding corruption was not applicable to those federations and something should change in this regard.”

How likely is such a change?

“The law is going to change this spring – the unfair competition act and the Swiss criminal court act regarding corruption – and it is in the hands of the department of justice and the police to modify the law. But we do not know yet if it will be strictly applicable to sports federations.” 

What are your expectations when it comes to changes?

“I hope and I believe that something will change in this field because the international pressure is growing bigger and bigger towards those federations. We still consider them as public service providers; they have a role to play in society, and if you have people that are corrupt in these organisations you cannot fulfil this role. 

But another issue is that many cities want to attract these international sports federations with different facilities, infrastructures and privileges. So it is not as easy as to say that Switzerland should just strengthen the law. If the law is too strong maybe there is a risk that these international federations will leave Switzerland for a country where the law is more flexible, as it has been the case in Switzerland until now.”

What do you think the AGGIS project can do when it comes to promoting better governance in sports organisations?

“I think that the whole issue regarding good governance in sport is about what the concept of good governance is. We have quite important literature on good governance and governance of sport, but still it is very abstract. 

I think that the AGGIS group and the tool that will be provided tries to cope with this issue of abstraction by trying to find something that is closer to reality and to identify what good governance really is – not just talking about democracy and transparency. To find indicators and to see to what extent these indicators fit with the reality of the international sports federations is a big step for research, but also for policy making, and I am looking forward to the future of this project.” 

Michael Mrkonjic is a Ph.D. Candidate at IDHEAP (Swiss Graduate School of Public Administration), Lausanne, Switzerland 

Links to other AGGIS video interviews:   

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