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The 157-year-old body that organises the Wimbledon tennis championships has warned the federal government that proposals to cap the worth of resale tickets to live events could endanger the sale of debenture seats which might be a critical source of funding.
The All England Lawn Tennis Club fears that a price cap could be “extremely damaging”, putting funds which might be used to reinvest in facilities in danger, in keeping with an individual with direct knowledge of the matter.
The debentures, which were introduced by the AELTC in 1920, are the one Wimbledon tickets that could be legally resold and typically trade at a premium to their issue price. Implementing a price cap threatens to weaken demand for primary issuance by limiting the flexibility of holders to recoup their outlay and even profit by selling on the debentures after they are unable to attend matches.
Fiona Canning, associate director of finance and debentures on the AELTC, told the Financial Times that debenture sales had raised greater than £500mn previously 10 years, all of which was invested into developing and maintaining Wimbledon’s facilities.
She said the club would “work with the federal government to be sure that any recent regulations are considered fastidiously and don’t result in any unintended consequences for Wimbledon’s debenture programme” in an announcement ahead of the ultimate weekend of the championships.
The comments come because the UK government is considering implementing measures to manage “dynamic pricing” after fans of Oasis were left facing huge mark-ups on tickets for the band’s reunion tour.
The federal government set out plans to cap the worth of tickets sold on the secondary market in January, when it opened a consultation to guard consumers from ticket touts. It said on the time it intended “to clamp down on exploitative practices and to enhance fairness for fans within the resale market”.
The consultation, which is now closed, explored various measures, including caps starting from face value to a 30 per cent increase. Also into consideration is a limit on what number of tickets could be resold by a person buyer.
While the AELTC is supportive of the federal government’s consultation process, it has made it clear to the federal government that it’s against a price cap on its debentures and shall be in search of an exemption or other relief.
Protecting the debenture programme is important to Wimbledon since the funds raised from selling the instruments, that are tradeable assets regulated by the Financial Conduct Authority, are used to speculate in improving the grounds and facilities.
The tennis organisation was hopeful that the federal government wouldn’t damage Wimbledon’s debenture programme after a series of conversations, people conversant in its considering said. One solution could be to permit an “authorised resale” category of tickets that will protect debentures from the worth cap.
A spokesperson for the Department for Business and Trade in addition to the Department for Culture, Media and Sport said the federal government was “committed to clamping down on touts”. “We’re considering the evidence provided in response to our consultation earlier this 12 months and can set out our plans soon.”