“We’ll certainly proceed regardless of the new coronavirus,” says the Japanese side.[1] Does this sound reasonable in the current situation? How dare they say “regardless”? Aren’t they giving at least some consideration to the possibility of canceling the Olympics?
Maybe, it is because of their legal position. Reading the Host City Contract 2020[2], the contracting party who is entitled to cancel the Olympics is the International Olympic Committee[3] (‘IOC’), not the Japanese side. Section 66 of the Contract says as follows:
Section 66 Termination of Contract
a) The IOC shall be entitled [emphasis added] to terminate this Contract and to withdraw the Games from the City if:
ⅰ) the Host Country is at any time, whether before the Opening Ceremony or during the Games, in a state of war, civil disorder, boycott, embargo decreed by the international community or in a situation officially recognized as one of belligerence or if the IOC has reasonable grounds to believe, in its sole discretion, that the safety of participants in the Games would be seriously threatened or jeopardized or any reason whatsoever;
ⅱ) [omitted]
It says that ‘The IOC shall be entitled…’, which means that the Japanese side is not entitled. Therefore, technically speaking, the Japanese side cannot terminate the Contract and cancel the Olympics on their initiative. If they did so, it could amount to a breach of the Contract, which triggers compensation for damages. While the Japanese side must have secured insurance covering the games’ cancellation, we don’t know to what extent it covers the loss.
Then, is the IOC likely to take the initiative to cancel the Olympics? Several sources are claiming that since the IOC has already received the fee from NBC Universal for the broadcasting rights in the US, which is the financial basis of the IOC, they won’t be able to cancel the Olympics forfeiting the fee unless the Japanese side initiates it (in the latter case, the IOC can claim for damages against the Japanese side.).
If this is the case, neither side can mention a cancellation on its initiative. This is like a game of chicken.
Note:
[1] The Japanese side means the City of Tokyo (the ‘City’), the Japanese Olympic Committee (the National Olympic Committee, the ‘NOC’) and the Organising Committee of the Olympic Games (the ‘OCOG’).
[2] https://www.2020games.metro.tokyo.lg.jp/hostcitycontract-EN.pdf
[3] The IOC is an international non-governmental not-for-profit organisation based in Switzerland (see Paragraph 1 of Rule 15 of the Olympic Charter).
Disclaimer: While every effort has been made to ensure that the information on this article is accurate at the time of posting, it is not intended to provide legal advice as individual situations will differ. If you do require advice or wish to find out more about the information provided and related topics, please contact the author.
Text by: Atty. Atsushi Miyake of Miyake Law, February 2021.
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