In mid-June, the FIFA Secretary General asked the independent Chairs of the FIFA Ethics Committee's Investigatory Chamber and the FIFA Audit and Compliance Committee--Michael J. Garcia and Domenico Scala, respectively--whether FIFA could distribute two Hublot watches commemorating the 2014 FIFA World Cup to members of the FIFA Executive Committee as a "gift." The request stated that Hublot provided the watches to FIFA pursuant to a value-in-kind provision of a commercial agreement. The watches--56 in total--were proposed to be given during the Executive Committee's September 2014 meetings in Zurich. The day after receiving this inquiry, Messrs. Garcia and Scala responded in a joint letter that the proposed gift would likely violate both the FIFA Code of Ethics ("FCE") and recently established compensation policies. FIFA has represented to Messrs. Garcia and Scala that the Hublot watches were not and will not be distributed to the Executive Committee.

In a separate incident, in mid-June, several football officials reported to the Investigatory Chamber that Confederação Brasileira de Futebol ("CBF") had given each of them a gift bag containing what appeared to be a valuable watch. In addition to advising those officials to turn over the watches to the FIFA Ethics Committee, the Investigatory Chamber commenced a preliminary investigation. Beginning in June, the Investigatory Chamber issued written requests for information to CBF, which cooperated with the inquiry. CBF stated that in connection with the 64th FIFA Congress and the beginning of the 2014 FIFA World Cup Brazil, it distributed 65 gift bags, each containing a Parmigiani watch, to a group comprising the 28 officials on the FIFA Executive Committee, a representative from each of the 32 Member Associations competing in the 2014 FIFA World Cup Brazil, and a representative from each of the 10 Member Associations in Conmebol. CBF produced records indicating that it obtained the watches from Parmigiani, a CBF sponsor, at a price of USD 8,750 each. The Investigatory Chamber commissioned an independent appraisal of one of the watches CBF distributed. That appraisal determined that the watch had a market value of CHF 25,000. That value was confirmed by a later appraisal done in Zurich.

The FCE plainly prohibits such gifts. Football officials may not offer or accept gifts that have more than "symbolic or trivial value." FCE Art. 20(1)(a). "If in doubt, gifts shall not be offered or accepted." FCE Art. 20(2). Football officials "are expected to be aware of the importance of their duties and concomitant obligations and responsibilities," FCE Art. 13(1), and must "immediately report any potential breach" to the Investigatory Chamber, FCE Art. 18(1). FCE violations may be sanctioned regardless of whether they were "committed deliberately or negligently." FCE Art. 5(2). Accordingly, CBF should not have offered the watches, and those who received gift bags should have promptly checked whether the items inside were appropriate and, upon discovering the watch, either returned it or, like the football officials referred to above, reported the matter to the Investigatory Chamber.

In an effort to resolve this matter expeditiously, the Investigatory Chamber will not pursue further formal ethics proceedings in this matter against officials who submit the Parmigiani watch they received from CBF to the Secretariat of the Investigatory Chamber by no later than October 24, 2014. The Investigatory Chamber and CBF have agreed that, following the October 24 deadline, all watches submitted to the Investigatory Chamber will be donated to an independent non-profit organization or organizations committed to corporate social responsibility projects in Brazil.