By Andrew DISMORE, Labour Assembly Member for Barnet and Camden.
Boris Johnson’s lack of attention to detail has led to considerable discomfort over the Israel boycott clause in the Emirates Airline cable car sponsorship deal. This is all the more embarrassing as the revelations come hard on the heels of a planned trade mission to Israel.
It is surprising that the Mayor seems to have had no idea about this clause, having spent so much time personally promoting the cable car. The contract unlawfully breaches the EU/Israel trade agreement, competition law, the Race Relations Act and the Equalities Act. It may also break American laws too, which could have considerable consequences for TfL and its contractors beyond the cable car contract.
Once the scandal emerged, the mayor ordered a renegotiation of the contract, which is welcome. But this does not go nearly far enough. We have had no explanation of how this contract was agreed in the first place. Was it a deliberate decision to secure the sponsorship deal at all costs? Or was it simple carelessness or incompetence? No heads have rolled so far for this appalling act of discrimination.
In its initial response to the revelations, TfL said: “It is to be expected that a sponsorship contract would include a clause to ensure that an organisation cannot simply introduce someone else that cuts across the commercial interests of a main sponsor… This is standard practice.”
How on earth could it believe such patent rubbish? Protecting commercial rights and genuine business principles have nothing to do with approving a nationality boycott. This is not standard practice – except, perhaps, in the UAE.
The deeper I’ve dug, the larger this can of worms becomes. As a Gulf-based company, Emirates is bound by UAE law, which demands that an Israel boycott is included as a clause in every contract drafted on its behalf.
The inference is that other commercial contracts could also contain this boycott clause.
So if the mayor is renegotiating with Emirates, he must ensure that it no longer imposes this term in any of their contracts. If he fails to, then even if this contract is amended he is still doing business with a discriminating company.
In addition to the cable car deal, Emirates sponsors other events and organisations. The question must now be asked: do these sponsorship deals also exclude Israel? Have such discriminatory terms been accepted by these other bodies when seeking Emirates cash? And are similar terms required for sponsorship by other Gulf based businesses such as Etihad, in their sponsorship deals?
I’ve written to a number of Emirates- sponsored organisations to find out. I hope they have not been as foolish as Boris Johnson in signing such agreements and will, in the spirit of openness, make clear where they stand on such discrimination. But, so far, they have not replied. Perhaps this silence speaks for itself: FIFA, the ATP Tennis World Tour, Formula One, The Ryder Cup and even International Cricket Council’s Elite Panels of Umpires are potentially implicated as well as the Cricket World Cup and Emirates sponsorship deals worldwide.
The USA has a law forbidding anti-Israel boycotts. The contractor who built and now runs the London cable car is Mace, which also runs significant operations in the USA. Since the contract was awarded to Emirates in October 2011, Mace appears to have been be in breach of the US Export Administration Act, which prohibits doing business with any company or entity engaged in an Israel boycott. This can result in a fine of up to $250,000.
US law also prohibits profiting from any relationship with an entity that boycotts Israel.
So any US based company that has worked with TfL since the Emirates contract was signed – on any business across the full range of their operations – may also face fines.
If Boris Johnson is serious about doing business with Israel, he’d better start by sorting out this mess of his own making.