Trade fair cancellations in Corona times: who pays?

Germany Berlin Development of ITB despite coronavirus (Getty Images / S. Gallup)

Whether in Berlin, Paris, Geneva, whether in Bologna or Leipzig – trade fairs are canceled everywhere. Responsible: coronavirus. But who actually stays on the costs after a sudden cancellation?

Fairs are meeting places par excellence, also for virus carriers. Visitors from many places come together in one place to stand together, to talk, to inspect goods, to sign contracts. A lot goes from hand to hand, kisses her, kisses there, handshake, dozens of times a day. No wonder that hundreds of trade fairs around the world are being canceled so as not to expose visitors and exhibitors to a danger that everyone is now familiar with: the coronavirus.

It started with the world’s largest mobile communications fair, the World Mobile Congress in Barcelona. This was followed by trade fairs for travel (the ITB in Berlin), for cars (the Geneva Motor Show ), for wine, for artisans, small trade fairs, large trade fairs, and book fairs, in Bologna, in Paris and then in Leipzig. Now, at the beginning of March, around 400 trade fairs have been canceled worldwide.

The Hanover Fair, on the other hand, is only postponed. Instead of the original date at the end of April, the world’s largest exhibition for automation and energy technology is now to take place in mid-July.

Leipzig Book Fair (picture-alliance / dpa / J. Woitas)Leipzig Book Fair: formerly full, now canceled

 410 million participants

There are more than a hundred canceled trade fairs in Europe. The authorities in Switzerland are particularly strict, here all gatherings with more than a thousand people are prohibited. So far, most of the cancellations have been in Asia, but those in Germany are also drastic: with 410 million participants, the country is the second-largest conference country in the world after the USA, and there are trade fairs and exhibitions from Kiel in the north to Friedrichshafen in the south.

It is often about large numbers and a lot of money. The failure of the World Mobile Congress is said to have cost Barcelona 500 million euros in sales. This year 280,000 visitors were expected to the Leipzig Book Fair, 2,500 exhibitors had registered. In 2019, according to the organizers, deals for seven billion euros were closed at the ITB in Berlin, which was canceled for this year.

And what about the fair builders, what about large car companies, the small winemakers and craftsmen and publishers who have booked a stand? Who pays for it? And who will compensate the trade fair organizers who provide the halls, the staff, and the logistics?

“Giant hole in the order books”

The first answers come from the stand builders, i.e. the service providers who set up the stands for the exhibitors. “If a large trade fair is canceled, it tears a huge hole in the order books,” said Jan Kalbfleisch from the industry association Famab. According to a first report, the damage caused by previous cancellations amounts to 426 million euros. Many companies, according to veal, are now faced with the question “how should they survive the next few months”.

Germany fair ITB Berlin 2019 l preparation (picture-alliance / dpa / B. Von Jutrcenka)Trade fair builders as sufferers: Estimated failures of 426 million euros

Most of the exhibitors themselves can get away with a black eye – at least when it comes to standing costs. After the cancellation of the Leipzig Book Fair, the Börsenverein des Deutschen Buchhandels states: “The money for the booth will be returned because the Book Fair was officially canceled.”

As a rule, this also applies to other trade fairs, according to the Exhibition and Trade Fair Committee of the German Economy (AUMA): “If an event is canceled, the contract must be carried out taking into account the conditions of participation”, said Silvia Bauermeister from AUMA to DW, “with the result that contributions already paid, such as stand costs, are generally reimbursed”. But no one is responsible for the failures of the trade fair organizers.

It looks stupid for the individual exhibitors when it comes to hotel costs and flight or train tickets. Once paid, you rarely get it back. It is difficult to estimate the lower income for the cities that host large exhibitions. According to the Munich Ifo Institute, exhibitors and visitors in the German trade fair cities spend 14.5 billion euros a year. After all, there are 185 industry fairs of some importance in Germany alone.

European Athletics Championships Olympiastadion Berlin (picture alliance / dpa)What about the major sporting events this summer?

European Football Championship and Olympic Games

And then there are the really big events: the European Football Championship next summer and the mega event par excellence, the Olympic Games, which are due to start in Tokyo in July. What will happen if the Coronavirus does not calm down by then? Most schools in Japan are currently closed for a month because of the virus. A few weeks ago, the organizers had put the cost of the games at $ 12.4 billion.

The Discovery group paid $ 1.4 billion for TV rights in Europe alone. No problem, Discovery CFO Gunnar Wiedenfels told Variety magazine: A cancellation would have “no negative impact on our finances”. Insurance was taken out just in case.

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