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The 157-year-old body that organises the Wimbledon tennis championships has warned the government that proposals to cap the price of resale tickets to live events could endanger the sale of debenture seats that are a critical source of funding.
The All England Lawn Tennis Club fears that a price cap would be “extremely damaging”, putting funds that are used to reinvest in facilities at risk, according to a person with direct knowledge of the matter.
The debentures, which were introduced by the AELTC in 1920, are the only Wimbledon tickets that can 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 ability of holders to recoup their outlay or even profit by selling on the debentures when they are unable to attend matches.
Fiona Canning, associate director of finance and debentures at the AELTC, told the Financial Times that debenture sales had raised more than £500mn in the past 10 years, all of which was invested into developing and maintaining Wimbledon’s facilities.
She said the club would “work with the government to ensure that any new regulations are considered carefully and do not lead to any unintended consequences for Wimbledon’s debenture programme” in a statement ahead of the final weekend of the championships.
The comments come as the UK government is considering implementing measures to control “dynamic pricing” after fans of Oasis were left facing huge mark-ups on tickets for the band’s reunion tour.
The government set out plans to cap the price of tickets sold on the secondary market in January, when it opened a consultation to protect consumers from ticket touts. It said at the time it intended “to clamp down on exploitative practices and to improve fairness for fans in the resale market”.
The consultation, which is now closed, explored a number of measures, including caps ranging from face value to a 30 per cent increase. Also under consideration is a limit on how many tickets can be resold by an individual buyer.
While the AELTC is supportive of the government’s consultation process, it has made it clear to the government that it is opposed to a price cap on its debentures and will be seeking an exemption or other relief.
Protecting the debenture programme is vital to Wimbledon because the funds raised from selling the instruments, which are tradeable assets regulated by the Financial Conduct Authority, are used to invest in improving the grounds and facilities.
The tennis organisation was hopeful that the government would not damage Wimbledon’s debenture programme after a series of conversations, people familiar with its thinking said. One solution would be to allow an “authorised resale” category of tickets that would protect debentures from the price cap.
A spokesperson for the Department for Business and Trade as well as the Department for Culture, Media and Sport said the government was “committed to clamping down on touts”. “We are considering the evidence provided in response to our consultation earlier this year and will set out our plans soon.”