A cancellation of high economical and legal effect:
A tense calm has taken over the city of Barcelona last week, after it has been agreed unilaterally by the organising body GSMA, the cancellation of the Mobile World Congress 2.020 which was to be held from 24th to 27th February.
Likewise, even that barely mentioned, also has been cancelled the first Xside, organized jointly by the GSMA and the organizers of the Sónar, a show of innovation and creativity, with conference and industry discussions in the daytime and electronic music concerts at night. Also, has been cancelled the 4 Years From Now (4YFN), which was supposed to bring together entrepreneurs and investors.
It seems clear that we are facing a calm before a multitude of claims, whether judicial or extrajudicial, in relation to the economic consequences and damages that this cancellation will mean for those affected. And all those involved must be prepared and must carry out a legal analysis of their real situation, either as the injured party or as the responsible party, in the light of the complex legal struggle arising in order to clarify: who will be responsible for the losses running to millions caused by the cancellation of the event; and check, in the frame of their respective contracts, before who they may be liable, who may be liable before them, and the object and the quantum of the claims that they may receive or file. It will be necessary also to analyse the previous steps they should take for the best way to protect their interests, taking into consideration the large variety of situations, as initially, everyone can claim against each other, for having received amounts without providing the services or having prepared services without receiving amounts, and with the intermediation of any insurance that may be involved and its coverage in case of acceptance of the cause of force majeure or not. Basically, who should respond in each case and for what amounts.
As commonly known, the organization decided to cancel the event on the grounds of force majeure, according to its own statement, that
“With due respect to the safe and healthy environment in Barcelona and the host country, the GSMA has cancelled the MWC Barcelona 2020 because of global concerns about the coronavirus outbreak, travel concerns and other circumstances make it impossible for the GSMA to hold the event.”
It is true that during the week before the cancellation we were present to several resignations by the companies, but it also should be remarked that the many of these companies are members of the Board of Directors of the GSMA, which is an organization that, as indicated on its own website, “represents the interests of mobile operators worldwide, uniting more than 750 operators with nearly 400 companies in the broader mobile ecosystem, including device and hardware manufacturers, software companies, equipment suppliers and Internet companies, as well as organizations in related industries”.
And, above all, this health threat has been repeatedly denied by both the Spanish Minister of Health and the Catalan Councillor for Health, who have repeatedly stated before the chambers that there is no public health reason to suspend the congress.
Consequently, it seems that there is no legal basis on which can be justified the cancellation on grounds of force majeure, basing the risk to the public health on some companies own announcements, companies that additionally are relevant members of the GSMA, especially when they have maintained their presence in the Trade Fair for audiovisual and electronic integration, the Integrated Systems Europe (ISE) in Amsterdam. It will be difficult to prove that coming to Barcelona was more dangerous than going to Amsterdam, hardly to conclude whether or not force majeure has been involved.
Furthermore, we will see what happens with the next event scheduled by the GSMA, the Mobile 360 Security for 5G, to be held in The Hague (The Netherlands) on 29th and 30th April this year.
Therefore, if the existence of force majeure is excluded as a reason for the cancellation of the event, arises the possibility to the affected parties to bring claims for damages suffered as a result of such cancellation.
Subsequently, all those affected must first clarify this aspect of the legal relationship and consider, on the basis of appropriate advice, the scope of the breach and the amounts to which they may be entitled in some cases or to which they must be liable in others.
From an exclusively legal point of view, many are the issues involved in the dispute, therefore it is undoubtedly advisable that all those affected seek comprehensive advice with the ability to approach the problem from their very different perspectives. Indeed, if one takes a look at the small print of the contracts signed between the operators, among their many conditions is a clause in which the organization is exempted from liability in the event that they cannot meet their obligations due to force majeure, and therein resides the essence of the matter, the set of liabilities will depend on whether or not the Courts and Judges endorse the alleged force majeure by the organization.
Those affected are many and of different categories, and the legal relationships involved are very wide-ranging, as we are dealing with exhibitors who have not been able to attend due to cancellation and who have assumed a series of expenses beyond the amount paid to the organisation, ranging from hotels, plane tickets, contracted events, stand construction. etc., which, depending on the cancellation conditions, must be covered and, where appropriate, claimed from the companies providing services such as hotels, catering services and so on.
Ultimately, the issue is:
(i) Determine whether or not there has been a force majeure reason for the cancellation of the event
(ii) Determine the damages suffered by each of the affected parties and the possible responsible party
(iii) Initiate, if appropriate, the corresponding claim against the organization or against other possible obligated parties.