Qatar's BeIN Seeks $1 Billion From Saudi Arabia Over Piracy

(Bloomberg) -- Qatar’s BeIN Sports network began legal actions against Saudi Arabia on Monday, seeking $1 billion in damages over pirated sports broadcasts, the latest escalation in a spat that has seen the Gulf Arab neighbors sever diplomatic and trade ties.

The tussle over television rights escalated before this year’s soccer World Cup began in Russia, as the two sides accused each other of bad faith over a deal covering a large chunk of the tournament’s matches.

BeIN Sports said in a statement it had lodged an international investment arbitration case against Saudi Arabia, contending that it has been "unlawfully driven out of the Saudi market." The state of Qatar also filed a separate case on Monday with the World Trade Organization in Geneva claiming that Saudi Arabia had violated the organization’s intellectual property rights agreement.

The Saudi government’s Center for International Communication did not immediately respond to a request for comment. Saudi officials have previously denied any link to a sports service broadcasting pirated content.

The two countries have been locked in a broader political standoff for more than a year. Saudi Arabia and three of its allies severed diplomatic, trade and transport links with Qatar in June 2017, accusing the gas-rich peninsula of sponsoring terrorism and meddling in their internal affairs. Qatar, which is set to host soccer’s World Cup in 2022, has denied those allegations and says the boycott is an attempt to subvert its sovereignty.

The spat spilled into sports broadcasting rights with the mysterious emergence of a pirated channel called beoutQ.

BeoutQ appeared after the devices used to broadcast beIN Sports were banned from import to Saudi Arabia. It broadcasts the same games and commentary as beIN Sports, complete with a faint beIN logo that floats across the screen. Promotional materials for BeoutQ say it’s backed by Colombian, Cuban and Middle Eastern investors.

Qatar alleges that Saudi Arabia is behind the pirated broadcasts, which are interspersed on beoutQ with anti-Qatar content. Saudi Arabia has denied that it has anything to do with the channel and said it’s been fighting beoutQ by confiscating thousands of devices used to stream it.

A WTO spokesman confirmed Oct. 2 that the WTO received Qatar’s request for consultations, which marks the first stage in the WTO dispute settlement process.

If Qatar and Saudi Arabia can’t resolve the matter after 60 days, Qatar may then ask a WTO dispute settlement panel to investigate the matter and issue a ruling.

BeoutQ devices were widely available in Saudi Arabia in the months leading up to the World Cup, and it’s common to find the channel broadcasting sports in restaurants and cafes across Riyadh. Saudi officials said the devices were also available in other countries.

World soccer governing body FIFA said in July that it would take legal action in Saudi Arabia, though it didn’t say who it planned to sue.

In the arbitration case, beIN Sports alleges that Saudi Arabia "initiated a series of abusive measures specifically targeting" the company in order to force it out of the Saudi market, revoking beIN’s legal right to operate, banning the import of beIN set-top boxes, suspending all monetary transactions with beIN and blocking its website.

"BeIN has suffered damages in excess of $1 billion, which continue to increase with each passing day," the company said in the statement.

Meanwhile, beoutQ has "created a plague of piracy," Sophie Jordan, beIN Media Group’s general counsel, said in the statement. "Unless the whole sports, entertainment and broadcast industry takes a stand, its impact will be devastating and irreversible."

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