2005: ‘Promotional fees’ a Euro Tour way of life
Tuesday, September 6, 2011
Financial inducements for big names to play on the PGA European Tour have been around since the circuit’s inception in 1972.
Because it operates at a competitive disadvantage, the European Tour can’t afford to apply the same stringent rules as the PGA Tour. Although both tours conduct close to the same number of tournaments, total prize money on the European Tour trails its American counterpart by about $100 million. The PGA Tour offers more television exposure to top players, which equates to more endorsement opportunities. Thus, the only way European tournament sponsors can level the playing field is to offer payment of “promotional fees.”
Participation inducements of any kind have been banned in American professional golf since the 1950s, when restrictions on compensation were written into the PGA of America bylaws. (Members who made their living playing tournament golf split from the PGA of America in 1968 to form the Tournament Players Division, which was renamed the Tournament Players Association Tour and didn’t become known as the PGA Tour until 1983.)
Technically, the European Tour does ban appearance money. But sponsors are allowed to circumvent the rule by paying “promotional fees” to players in exchange for appearances designed to increase interest in the tournament proper. For example, Ernie Els’ reported £200,000 (approximately $383,000) fee in Qatar was justified when he gave a pre-tournament clinic and handed out the pro-am prizes. And when Tiger Woods hit balls off a helipad atop the Burj Al Arab hotel before the 2004 Dubai Desert Classic, he was allowed under European Tour rules to claim a fee that was rumored to be $2 million.
Ironically, it was the demands of marquee players from America – and the advent of player managers who took cuts of their clients’ earnings – that stoked the appearance fee flame in the early ’70s. Tony Jacklin, winner of the 1969 British Open and 1970 U.S. Open, was the only home-grown player with enough clout to enter the European appearance money fray.
As Europe’s only major championship winner, Jacklin was paid around £2,000 per European appearance. Seve Ballesteros upped the ante following his victories in the 1979 British Open and 1980 Masters. The Spaniard – along with U.S. stars such as Lee Trevino, Johnny Miller, Tom Watson, Arnold Palmer and Jack Nicklaus – could command appearance fees of $25,000.
The European Tour banned all appearance money before the 1981 season, but the rule applied only to European Tour members. American interlopers could still ask for, and be paid, appearance money.
Ballesteros balked. He was never one to take a back seat to American players, and he refused to stand by idly as they collected thousands of dollars for turning up while he got nothing. In protest, Ballesteros resigned his European Tour membership – a move that cost him a spot in the 1981 Ryder Cup at Walton Heath.
Some tournament sponsors were angry at the loss of Europe’s biggest draw from their fields; smaller promoters were elated to compete on equal footing. The following season, the European Tour relented and reinstated appearance money, up to $10,000 per event. The limit never was strictly enforced; Ballesteros and others were paid what the market would bear. The same holds true today under Rule 6 of the European Tour Members General Regulations, or the “promotional fee” clause.