PRO Rugby North America

November 02 2016

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posted Nov 2 2016
[ed. comments below. Rugby Canada have issued their statement which backs up our original story that the exclusivity clause was the deal breaker. What the RC announcement doesn't mention is the timing of that clause which was a late addition according to PRO Rugby sources. PRO Rugby has updated their response as of Nov 3rd, appended at the bottom.]

The official announcement came over Twitter at 7:55am and there's no doubt from the tone that PRO Rugby blames Rugby Canada and basically says so in a later tweet. Rugby Canada have promised a full commentary according to Tim Powers, the chairman of Rugby Canada. The tweets appended below tell the story.

Further communication with Doug Schoninger, the entrepreneur behind PRO Rugby North America, made it clear that he felt disrespected by Rugby Canada. Rugby Canada "tried to sneak a clause in the agreement that allows foreign comps" after agreeing to terms, according to Schoninger.

It appears Rugby Canada have put their faith in PRO 12 or Super Rugby coming to Canadian shores in the near future. Time will tell if they made a huge mistake by alienating a sure thing for next year or made a good decision by waiting an extra year for Tier 1 professional. One thing is for sure the pressure is now on Rugby Canada to deliver professional rugby by 2018.

A secondary factor in this, behind the scenes, may be the support the CRC receives from the provincial unions. It's unlikely the CRC (Canadian Rugby Championships) would coexist with PRO Rugby North America as they operated in the same competition window in 2016. Rugby Canada just concluded a meeting with provincial unions in PEI this past weekend and this "competition clause" and subsequent falling apart of the agreement followed within days.

Whether the actions of Rugby Canada and the Provincial Unions are in the best interest of rugby or just in maintaining the existing power structures of rugby in Canada is a question that readers will have to consider.

PRO Rugby Official Response Nov 3rd on FB

Yesterday it was announced that we would not have PRO teams in Canada. I have received many inquiries and I thought it best now to answer some of those questions and also discuss some other issues:
1. The main point of disagreement between PRO and Rugby Canada was over exclusivity. RC had agreed to give us an exclusive professional sanction and then, on Friday of last week, decided to reverse the agreement. I asked them if this was non-negotiable for them, as they knew it is for me, and they said it was. At this point, as there was no way forward, we made the announcement. I have not received a reason for their reversal.
2. We have been talking to RC about an exclusive agreement since the summer of 2015 and, after an agreement for our 2016 season fell apart at the last minute, I was very gun shy of restarting the process again. When I was assured that all terms were acceptable to RC I started the process of vetting venues. On 9/19 in a meeting at our offices and after their meeting with Pro12, RC stated that they had only listened to Pro12 as a courtesy and they understood, because of the small number of potential markets in Canada, a foreign competition team in Canada did not make sense.
3. There was never any conversation or discussion between us and RC regarding the Canadian Centre for Ethics in Sport guidelines, either this year or last. To insinuate that this was a cause of the agreement not being executed is both untrue and insulting to PRO.
4. Though we experienced standard start-up operational issues, it is untrue to say that these problems were systematic. We are owed substantially more money than we owe to venues. Almost 200 rugby personnel were paid over $4 Million last year with 95% of that going to payroll on the team level to players, coaches, managers, etc. I have been told that this is more money than has been paid to rugby players in NA in aggregate ever.
5. PRO Canada was to have initially two teams, one in the Toronto area and one in the Vancouver area, comprised 100% of Canadian players and coached by leading international coaches. Though there was a concern that the Canadian sides would be stronger than the more diluted American sides, we agreed to this structure to simplify operations. The benefits of Canada's National playing pool training/playing in just two professional teams for 5 months a year would have been overwhelming.
6. We had secured a venue in the Vancouver area and were narrowing down our search in the Toronto area when I was informed of the exclusivity clause change.
7. Some people question why we deserve an exclusive professional sanction from RC. A good analogue would be a renter of an apartment. Would the renter renovate the kitchen, the bath, etc. knowing he only had a 2-3 year lease? Maybe, but not with serious investment. Rugby in Canada needs very serious investment and it is only fair and reasonable to have the opportunity to get a return on our investment of time and money. I truly doubt that anyone will make the necessary investment without protections.
8. Growing the game needs to be done in partnership. Players, coaches, unions, professional teams, etc. all benefit from the growth of the game. We are supportive of anything that grows the game and anyone that helps to grow the game. PRO cannot grow the game by itself but only in partnership with others.
9. Pro12 is an interloper and it is not in the best interests of NA unions to welcome them at this time. PRO Rugby was set up to develop both the game and player/coach capabilities. Introducing a foreign competition only upsets this process and funnels needed sponsorship and media dollars to their home unions and not to NA unions.
10. Pro12 does not have a legitimate business plan. There is no East Coast North American market that fits into their playing season. I understand their present concept is to have multiple home team venues (i.e. a NY/Houston and a Toronto/Vancouver joint teams) even though a multi-home team model is a completely unproven professional sports model and has never worked successfully in any professional sport.
11. Our concern is not a successful Pro12 team in NA, but a failed one. It will be easy for Pro12 to pick up and leave NA leaving behind the legacy of their failure for us to pick up the pieces. The experience that the Italian Pro12 sides are having speaks to the issues Pro12 is experiencing (and NA is about 4 times further away).
12. In 3-5 years, if Pro12 comes to Canada and spends all the necessary capital to activate the market, proves that professional rugby is viable, increases the rugby brand and infrastructure in Canada, PRO will be happy to have teams in Canada. It clearly will be easier for us to enter a more mature market than an unproven one.
13. As has been misreported and misstated many times, PRO does have an exclusive sanction for professional 15-side men’s rugby in the USA. USA Rugby has the contractual obligation with PRO to enforce our exclusive sanction against any and all challenges.
We are saddened that RC chose to change the agreement at the last moment. I had believed that our partnering with RC would have made our competition and Canada’s National team better in many ways. We look forward to watching the development of the game in Canada and look forward to having teams and employing Canadian players in our league sometime in the future.

Pemberton Holmes
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