THE promoter of the Volvo Ocean Race is threatening to sue the Valencian Generalitat regional govenment.
Their London law firm is threatening to initiate legal proceedings unless a debt of €581,813 is paid as agreed as part of the contracted deal done with the previous government. The situation now falls upon new Minister of Finance, Vicent Soler, who needs to settle the defaults on payment.
The apparent debt is believed to have arisen from a modified contract made between the Thematic Projects Society of Valencia, a public company dependent on the Generalitat, and Volvo Ocean Race in July 2013, following the initial contract made three years prior to that when the deal was done to host the launch of the round the world yacht race in Alicante in October 2014.
The Valencian Government and the organisers of the race agreed that Thematic Projects would be responsible for obtaining all necessary administrative licences needed to occupy the space at the Port of Alicante, while Volvo would assume the organisation of the official Race Village.
The two sides set a maximum cost of €4.5 million for the village, which should have been covered by sponsorship revenue. If sponsorship gained was less that the cost of assembly, it was agreed the Consell would fill the gap, of up to €3 million. Any revenues generated above the amount would be profit for Volvo and not the regional government.
However, there was a deficit in sponsorship and months after the race left Alicante, the organisers claimed Thematic Projects were to pay €2.99 million for the cost incurred in organising the Race Village. The two sides agreed to settle on €2.23 million with the Generalitat paying in instalments. But now, race organisers say there has been a default on payments and plan on suing if the outstanding amount is not paid before a deadline of Friday (August 14).
A previous economic impact study estimated that the Volvo Ocean Race 2014-15 generated €66.3 million in Valencia, and €89.3 million in the whole of Spain, after more than 300,000 visitors flocked to Alicante to see the Race Village which was open from October 2-11 last year ahead of the launch of the race.