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Football Business and Politics

Project: Football Business and Politics
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The midfielder George Eastham leaves Newcastle United and takes work outside football. Eastham has made several transfer requests, but they have been rejected by the club and his contract with it has expired. However, due to the retain-and-transfer system currently in operation, Eastham cannot simply sign for another club, as Newscastle holds his registration. Newcastle will relent and sell Eastham to Arsenal for £47,000 in November. However, at the urging of the Professional Footballers’ Association, Eastham will launch a legal action against Newcastle alleging the retain-and-transfer system is unlawful (see Summer 1963). (McArdle 2000)

Following pressure from players and the threat of a strike, the English Football League agrees to abolish the maximum wage that players can be paid. The wage is substantially below what the market rate would be, and in recent years there have been numerous cases of under-the-table payments being made to players. Immediately after the abolition, Fulham announces it intends to pay its star player, Johnny Haynes, £100 per week. This is five times more than the previous maximum wage and seven times more than the current average manual wage. (McArdle 2000)

George Eastham.George Eastham. [Source: BBC]Former Newcastle United midfielder George Eastham wins the Eastham v Newcastle United court case against the club (see June 1960). The case significantly changes the “retain-and-transfer” system that bound footballers to their clubs even when there was no contract between them. Essentially, the judge, Mr. Justice Wilberforce, finds that the system is an unreasonable restraint of trade and goes far beyond what is necessary to ensure clubs are able to protect their legitimate interests. The Football League argues that the retention provisions are necessary to stop the richer clubs signing all the best players, which helps maintain interest in the spectator sport. However, Wilberforce finds that this argument does not justify the mechanisms used by clubs to retain players and that it is unfair that players cannot get a job with a different club at a time when they are no longer employees of their old club and are not being paid by it. “The system is an employers’ system,” Wilberforce comments, “set up in an industry where the employers have succeeded in establishing a united monolithic front all over the world, and where it is clear that for the purpose of negotiation the employers are vastly more strongly organised than the employees. No doubt the employers all over the world consider this system to be a good system, but this does not prevent the court from considering whether it goes further than is reasonably necessary to protect their legitimate interest.” Despite Eastham’s victory, only the “retain” element of the retain-and-transfer system is abolished and a new transfer system is constructed. Every player’s contract is now a matter of free negotiation between him and the club, without the binds of the maximum wage (see 1961). Once a contract has expired, the club can only renew it on terms that are no less advantageous to the player than the old ones had been, and the new contract has to last for at least the same time period (unless both parties agree otherwise). If the club is unwilling to do this, the player is entitled to a free transfer; if the club decides to get rid of the player, the original contract will continue to run until he is transferred. Disputes will be referred to the League Management Committee and then to an independent tribunal incorporating league and players’ union representatives. (McArdle 2000)

Star French playmaker Michel Platini signs for Juventus. Platini will go on to make 147 appearances for the Italian football giants, and will lead them to victory in the European Cup in 1985 (see May 29, 1985). (Hart 4/5/2005)

Thirty-nine people die at the European Cup final between Juventus and Liverpool, played at the Heysel Stadium in Brussels, Belgium. (Hart 4/5/2005) The deaths occur as a group of Liverpool supporters break through a thin line of police at the aging stadium and advance towards the Juventus section. As the Italians try to escape, a retaining wall in one of their sectors collapses and many fans are crushed or trampled to death. (BBC 5/29/2000) The game is won by Juventus, after playmaker Michel Platini scores from a wrongly awarded penalty. Platini will later say that when he discovered the number of Juventus fans who had lost their lives, “Something inside me died,” but add that despite the deaths, the game, which gave Juventus its first European Cup triumph, “was not meaningless.” He will also say that the referee’s mistake in awarding the penalty was understandable: “If I’d been the referee I’d have given it too. [Juventus striker Zbigniew] Boniek was 60 meters away and he was going too quickly.” (Hart 4/5/2005)

FC Barcelona signs future superstar Lionel Messi, currently a 13-year-old schoolboy, from Newell’s Old Boys, a football club based in Rosario, Argentina. Messi has growth hormone deficiency; due to Argentina’s economic crisis, neither the country’s government nor Newell’s Old Boys can afford to pay for his treatment. Barcelona offers to pay for the medicine, which the club’s doctors deem necessary. The signing is made by Carles Rexach, Barcelona’s sporting director, when Messi does well after being flown to Spain for a trial. (Chadband 4/28/2009)

Arsenal pays £7.5m to sign Dutch striker Dennis Bergkamp from Internazionale. The fee is three times the club’s previous record and the move ends Bergkamp’s unhappy time in Italy, where he scored just 11 goals in 54 Serie A games. Bergkamp is reportedly to be paid £25,000 a week, making him the highest paid player in Britain. (Shaw 6/21/1995) Bergkamp’s contract is apparently the first for a British footballer to include a provision that part of the money Arsenal pays him is for image rights. This money is paid into an account in an offshore tax haven and taxed at a lower rate than the salary for playing football. David Platt, also signed by Arsenal around this time (see July 10, 1995), has a similar provision in his contract. (Norman 2/25/2011) The Inland Revenue will challenge the image rights payments, but will be unsuccesful (see April 2000). However, it will later win a significant settlement from British football clubs (see (March 2011)).

Arsenal pays £4.75m to sign veteran England international David Platt from the Italian club Sampdoria. (White 7/11/1995) Platt’s contract is reportedly the second for a British footballer to include a provision that part of the money Arsenal pays him is for image rights. This money is paid into an account in an offshore tax haven and taxed at a lower rate than the salary for playing football. Dennis Bergkamp, also signed by Arsenal around this time (see June 20, 1995), has a similar provision in his contract. (Norman 2/25/2011) The Inland Revenue will challenge the image rights payments, but will be unsuccesful (see April 2000). However, it will later win a significant settlement from British football clubs (see (March 2011)).

The Inland Revenue loses a test case against Arsenal and two of its players, Dennis Bergkamp and David Platt, over the use of image rights provisions in playing contracts to avoid tax. Bergkamp (see June 20, 1995) and Platt (see July 10, 1995) receive a portion of the money Arsenal pays them not as salary, but as compensation for the use of their image rights. The Inland Revenue claims to the Tax Special Commissioners hearing the case that this is a “smokescreen” for paying them money offshore to avoid tax, and that Arsenal, Platt, and Bergkamp should be subjected to income tax and national insurance contributions via Arsenal’s payroll. However, the commissioners decide that the payments are legitimately made in return for allowing Arsenal to exploit the players’ images, a purpose different to playing football. (Norman 2/25/2011) The making of payments to footballers for image rights will grow in future years, although the British tax authorities will win a settlement for the scheme’s over-use in 2011 (see (March 2011)).

The Spanish football club Real Madrid sells its training ground to the city council for €480m to wipe out a €290m debt. Under the agreement, the football club will relocate to a new training complex on the outskirts of the city by 2004. The council plans to construct four huge office blocks on the site of the current training ground, as well as a new 20,000-capacity sports pavilion for the city’s 2012 Olympic bid. Real president Florentino Perez says the deal will lift a major burden that has been hanging over the club. “I have been working for this from the very day I became president,” says Perez. “This is very important for Real Madrid because we have removed a terrible burden and will soon have a new training ground which will be even better than AC Milan’s Milanello training complex. From now on we can live without anxiety or financial difficulties. Real Madrid has not only to be a sporting leader, it must also be a financial leader too.” (BreakingNews(.ie) 5/8/2001) Real will use the proceeds of the sale to buy top players such as Zinedine Zidane, Luis Figo, Ronaldo, and David Beckham, but the transaction will be investigated by the EU (see March 3, 2004). However, Real will not be forced to repay any of the money (see (November 9, 2004)).

Farah Addo, vice president of the Confederation of African Football and president of the Somali Football Federation, alleges that the election of Sepp Blatter as FIFA president in 1998 was marred by bribery. Addo tells the Daily Mail that he was offered $100,000 for his vote. He refused, but “18 African voters accepted bribes to vote for Blatter.” Addo adds that he believes that some people in Blatter’s campaign were involved in the offers, although Blatter himself was not. According to Addo, all 51 African countries initially decided to vote for Blatter’s rival, Lennart Johansson. However: “Then I received a phone call from Somalia’s ambassador to one of the Gulf states. He said: ‘I have a friend who you know who wants to offer you $100,000 to switch your vote. Half in cash and the rest in sports equipment.’ They would send the cash to me or I could go to the Gulf to collect it.” Addo further alleges: “The night before the election people were lining up in Le Meridien Hotel [in Paris] to receive money. Some told me they got $5,000 before the vote and the same the next day, after Blatter won. I made my own private investigation and found that 18 African voters accepted bribes to vote for Blatter.” Mohiadin Hassan Ali, vice president of the Somalian association, confirms the story, saying, “We accepted money to vote on behalf of Somalia FA for J.S. Blatter in the FIFA presidential election in Paris.” (CNN 2/28/2002)

After months of negotiations, David Beckham signs a new three-year contract with Manchester United. Beckham is to receive £70,000 a week in basic pay and £20,000 for use of his image rights, representing a 300 percent salary increase. It is the image rights issue that caused the negotiations to go on for so long. “The process of every player contract negotiation is different,” says United chief executive Peter Kenyon, “and one of the unique aspects of David’s was understanding how his global image could best be utilized to the mutual benefit of Manchester United and David himself.” (BBC 5/12/2002) Clubs and players are keen to agree that a portion of compensation be paid for image rights, because it is taxed at a lower rate. (Norman 2/25/2011) The new contract should take Beckham’s total earnings to around £11m a year. Although Beckham’s deal is not the highest in world football, Beckham receives so much from endorsements that he may overtake French midfielder Zinedine Zidane as football’s top earner. (BBC 5/12/2002)

Chelsea and Australia goalkeeper Mark Bosnich tests positive for cocaine. He is subsequently charged by the Football Association with breaching doping regulations and bringing the game into disrepute. Chelsea also sacks him over the offense. Bosnich appeals to the Premier League, asking for reinstatement, but the league will find he has not been unfairly dismissed. He will receive a nine-month ban, and the incident ends his football career. (Daily Mail 1/17/2005)

FIFA executive committee member Julio Grondona, an Argentinian, makes disparaging remarks about Jews’ ability to referee football games. He comments, “I do not believe a Jew can ever be a referee at that level [the Argentinian first division] because it’s hard work and, you know, Jews don’t like hard work.” Grondona will not lose his position at FIFA, but will later become senior vice president of the organization. (Anthony 11/28/2010)

Chelsea FC owner Ken Bates agrees to sell the club to Russian oil and aluminum mogul Roman Abramovich for £140m. £80m of the money will be spent paying down debts Chelsea has recently accrued. £59.3m will be used to buy shares in the parent company, Chelsea Village, which are valued at a mere 35p each. Bates bought the club for £1 in 1982. The deal is the biggest in British football history. A statement issued for Abramovich pledges that he will invest in the team. (BBC 7/2/2003)

Cesc Fabregas, who will go on to captain Arsenal for a number of years, joins the club from Barcelona’s youth team. He is 16 years old. (Arsenal 2010) Fabregas is one of several Spanish players who leave their native country to join English football clubs at a young age; the moves are because English employment law allows 16-year-olds to sign contracts, whereas in Spain players can only sign when they are older (see October 10, 2007 and February 23, 2011).

Jaroslav Hastik, sports director at first division Czech football club Synot, calls referee Vaclav Zejda to offer him a bribe to influence today’s game between Synot and Blsany. Zejda agrees to take CZK 120,000 (approx. £2,000) to help Synot win the game, and to share the money with other officials. The telephone call is monitored by the police, who are aware that Hastik is corrupt. Zejda then informs his assistant Bohuslav Kratky and the fourth official Josef Dvoracek of what is to happen, and Synot wins 3-1. (Mladá fronta Dnes 5/14/2004) The police will also monitor the handing over of the bribe (see December 2, 2003).

Jaroslav Hastik, sports director at the Czech first division club Synot, hands over a CZK 120,000 (approx. £2,000) bribe to referee Vaclav Zejda in return for Zejda influencing a recent game between Synot and Blsany (see November 22, 2003). The handover takes place in an underground garage at a shopping center in Smichov, Prague, and is filmed by police. Later the same day, Zejda calls Jaromir Hlavac, another first division referee, and ask him to distribute half of the bribe among some of the other officials who were in charge of the match. Assistant Bohuslav Kratky is to get CZK 30,000, fourth official Josef Dvoracek is to get CZK 10,000, and referee assessor Pavel Sisak is to get CZK 20,000. This call is also monitored by the police. Although the others will be charged with corruption, Sisak will not, as the police will be unable to prove he accepted the money. (Mladá fronta Dnes 5/14/2004)

The BBC current affairs program Panorama runs a documentary entitled “Father and Son” about Manchester United manager Sir Alex Ferguson and his son Jason, a football players’ agent. The documentary alleges that Jason has exploited his father’s position to set up transfer deals and make financial gain from them. Jason will not be found guilty of any wrongdoing, but Sir Alex will refuse to speak to the BBC for a number of years. (Nakrani 11/30/2010)

FIFA president Sepp Blatter suggests that female footballers should wear tighter shorts in a bid to attract more spectators. “Let the women play in more feminine clothes like they do in volleyball,” says Blatter. “They could, for example, have tighter shorts. Female players are pretty, if you excuse me for saying so, and they already have some different rules to men—such as playing with a lighter ball. That decision was taken to create a more female aesthetic, so why not do it in fashion?” The comments will be condemned by numerous female footballers. (Christenson and Kelso 1/16/2004)

The European Union announces it has begun a preliminary investigation into the sale of Real Madrid’s training ground to the city council in 2001 (see (May 8, 2001)). The sale netted €480m, which wiped out the football club’s €290m debt and enabled it to buy players such as Zinedine Zidane, Ronaldo, Luis Figo, and David Beckham. “We believe Madrid’s regional authorities may have overpaid,” says Tilman Luder, the EU’s competition spokesman. He also warns that the club may have to pay back some money if the price exceeded the market value. “We have sent a questionnaire to the Spanish government: to find out why they bought this land, at what price, and if they can prove it was at the market price. We suspect that the purchase price was influenced by the fact that this property had been reclassified, which increased its value,” says Luder. If Spain’s response to the questionnaire is not satisfactory, the EU may launch a formal investigation. (Nash 3/4/2010) The EU will later drop the matter (see (November 9, 2004)).

Jaroslav Hastík, sports director at the Czech first division football club Synot, enters the referees’ dressing room at half time in a league game between Synot and Sparta Prague. “If you help us keep the result the way it is, we’ll give you CZK 175,000,” (around £3,700) Hastik tells assistant referee Stanislav Hruska. Hruska agrees to take the bribe and Synot go on to win the game. However, the dressing room is bugged by the police, and Hastik and Hruska will be arrested as the money is being handed over (see April 20, 2004). (Mladá fronta Dnes 5/14/2004)

Czech police arrest Jaroslav Hastik, the sports director of first division club Synot, and Stanislav Hruska, an assistant referee, on corruption charges. The arrest is made late at night at an Agip gas station near the town of Vyskov, as Hastik is about to hand over a CZK 175,000 bribe to Hruska for fixing the outcome of a game between Synot and Sparta Prague (see March 27, 2004). (Mladá fronta Dnes 5/14/2004)

The European Union drops a competition probe into a transaction in which football club Real Madrid received hundreds of millions of Euros from the Madrid city council in return for its training ground (see (May 8, 2001) and March 3, 2004). The commission concludes that no state aid for Real was involved in the transaction and no government resources were transferred to it. (Sports Illustrated 11/9/2004)

The Spanish government passes what will become known as the “Beckham Law.” The law grants a tax break to wealthy foreigners earning over €600,000 who work in Spain—they will pay only 24 percent income tax, whereas Spaniards earning the same amount pay 43 percent. The initial aim is to attract talented executives, but the biggest effect is on Spanish football, as the tax break allows Spanish clubs to attract high-paid players from elsewhere in Europe where there are higher tax rates. The law gets its nickname from Real Madrid midfielder David Beckham, who joined the club shortly before the tax break came into operation. A later Spanish administration will announce the end of the law’s application (see November 4, 2009). (Xinhua News Agency (Beijing) 11/4/2009)

FIFA vice president Jack Warner makes around $1 million touting tickets for the 2006 World Cup for fans of England, Mexico, and Japan. Warner and his son Daryan use a travel company they own, Simpaul, to strike secret deals to sell thousands of room-and-ticket packages to agents around the world. One group of 900 tickets is sold to England fans for that country’s first round matches, and similar packages are made available to 1,500 Mexico fans and 3,000 Japan supporters. (Jennings 9/12/2006)

Serbian-American businessman Milan Mandaric sells Portsmouth FC to Franco-Russian businessman Alexandre Gaydamak for £32 million. (Szczepanik 9/15/2008; Daily Mail 9/23/2008) The sale will later become controversial as speculation appears suggesting that Gaydamak’s father Arkadi, wanted for questioning in France over gunrunning during the Angolan Civil War, is the real owner. (Daily Mail 9/23/2008)

Real Madrid logo.Real Madrid logo. [Source: SoccerFiesta (.net)]Deloitte publishes its Football Money League rankings for the 2004-2005 season. The rankings of the top 20 European clubs and their football earnings are:
(1) Real Madrid (€275.7m)
(2) Manchester United (€246.4m)
(3) Milan (€234.0m)
(4) Juventus (€229.4m)
(5) Chelsea (€220.8m)
(6) Barcelona (€207.9m)
(7) Bayern Munich (€189.5m)
(8) Liverpool (€181.2m)
(9) Internazionale (€177.2m)
(10) Arsenal (€171.3m)
(11) Roma (€131.8m)
(12) Newcastle United (€128.9m)
(13) Tottenham Hotspur (€104.5m)
(14) Schalke (€97.4m)
(15) Lyon (€92.9m)
(16) Celtic (€92.7m)
(17) Manchester City (€90.1m)
(18) Everton (€88.8m)
(19) Valencia (€84.6m)
(20) Lazio (€83.1m) (Deloitte 2/2006 pdf file)

Randy Lerner, the American owner-in-waiting of Aston Villa, increases his potential shareholding in the football club to 85.5 percent. Lerner was set to own 59.69 percent of the club after his conditional £62.2m takeover offer in August, and now seems likely to take full control. However, he must still reach 90 percent stakeholder support by 18 September, until which time Villa’s existing board of directors remains in place. (BBC 9/5/2006)

FIFA’s newly established ethics committee holds its first meeting. (BBC 1/10/2011)

FIFA and the International Federation of Professional Footballers (FIFPro) sign a memorandum of understanding stating that FIFA and FIFPro have agreed to introduce FIFA’s proposed “6+5” regulations over the course of several seasons. Under the plan each club side would have to have six players qualified to represent the national association to which the club belonged at the start of each match. The other five and all the substitutes could then be foreigners. The plan is controversial because it is a clear breach of regulations on the free movement of labour set out in Article 39 of the Treaty of Rome, which governs the operation of the European Union. (Lynam 12/6/2006)

FIFA president Sepp Blatter makes a speech to the Soccerex conference in Dubai about a range of current topics. On the issue of video replays, he says he will never allow matches to be halted as long as he remains FIFA president. However, he remains open to goalline technology, provided it delivers an instant answer, and he thinks it may be ready for introduction at the Club World Championship in Tokyo in December 2007. Blatter also dicusses his “6+5” proposal to limit the number of foreigners clubs field. “We believe six plus five will give more incentive to young players,” says Blatter. “All the big clubs have youth departments but there is no chance for these players to play in the first team.… The big clubs with a lot of money can afford to buy the best players. They have 20, 25, sometimes 30 on their list but only 11 can play. What are the others doing? Waiting? Recuperating? Or taking away the chance for other teams to have a better starting eleven? What these rich clubs are doing is taking the best out of market, then not letting them play. Look at the results in some European leagues. Some clubs are already far away after a third of the season, the others can only play to avoid relegation, not for the title. Something is wrong about this.” Blatter also warns of foreign investors buying English clubs, saying: “England must be a very attractive league for investors to take over whole clubs. As long as they are promoting the game in a sensitive way, we are not concerned. But if they are arriving to take the best out of football, rather than to serve it, again something is wrong because when you have so much money, it leads to a distortion as far as the other clubs are concerned.” (Daily Mail 11/27/2006)

FIFA president Sepp Blatter gives an interview to the German magazine Kicker on a number of reforms for the world game. Blatter thinks that the football season should begin in late February and finish at the end of November, with the longer winter break being used for national team games. “I’ve just proposed to the clubs: play through the summer, make the season like the calendar year,” says Blatter. “This would leave enough time for players to recover and there could be blocks of three weeks of qualifying games in winter.” He claims, “This idea is supported by big European clubs.” In addition, in World Cup qualifying he wants more European groups with less teams qualifying from each group; this would lead to fewer games for national teams, which is what big clubs want. Blatter also expresses support for his “6+5” idea to limit the number of foreigners club teams field. “The ‘6 5’ is coming, for sure,” he says, although it is only to be applied in Europe. “First, it will bring a higher identification between clubs and fans. Second, it would raise the opportunities for talents. And third, the clubs’ finances would benefit if they take players from their own schools.” Such a rule is controversial, because it is contrary to well-established European Union regulations on the free movement of labour. Therefore, Blatter appeals to the EU to stay out of football, although he would like government help creating more transparency in financial structures in international football and its transfer market. Blatter also rejects calls for a salary cap. (Associated Press 12/4/2006)

Former France and Juventus player Michel Platini (see 1982) is elected head of the Union of European Football Associations (UEFA), defeating the incumbent Lennart Johansson. Platini wins in the first round of voting, just obtaining an absolute majority from the 52 national associations that voted in a secret ballot. Johansson had been president for 16 years. One of Platini’s main goals, with which Johansson disagreed, was to limit the number of Champions League places to a maximum of three per country, rather than four, starting in 2009. Only England, Spain, and Italy currently have four Champions League places, so the move would hit them, and potentially benefit voters from all the other countries. In addition, Platini wants a cost control measure that limits clubs’ playing staff salary costs to “something like 50-60 percent of turnover,” as well as to combat racism and fraud, develop UEFA’s competitions, and gain recognition of football’s special status in European law. (BBC 1/26/2007)

Deloitte publishes its Football Money League rankings for the 2005-6 season. The rankings of the top 20 European clubs and their football earnings are:
(1) Real Madrid (€292.1m)
(2) Barcelona (€259.1m)
(3) Juventus (€251.2m)
(4) Manchester United (€242.6m)
(5) AC Milan (€238.7m)
(6) Chelsea (€221.0m)
(7) Internazionale (€206.6m)
(8) Bayern Munich (€204.7m)
(9) Arsenal (€192.4m)
(10) Liverpool (€176.0m)
(11) Lyon (€127.7m)
(12) Roma (€127.0m)
(13) Newcastle United (€124.3m)
(14) Schalke (€122.9m)
(15) Tottenham Hotspur (€107.2m)
(16) Hamburg (€101.8m)
(17) Manchester City (€89.4m)
(18) Rangers (€88.5m)
(19) West Ham United (€86.9m)
(20) Benfica (€85.1m) (Deloitte 2/2007 pdf file)

Chelsea announces the club lost £80.2m in the 2005-06 season. The loss is far less than the season before, when it was around £140m, but is still the third largest loss in the history of English football. Total losses over the three years since Roman Abramovich bought the club now exceed £300m. (Reuters 2/19/2007) Chelsea turned over €221m in the 2005-06 season (see February 2007).

David Dein leaves Arsenal’s board of directors over a dispute on the football club’s future direction. Dein, who owns 14.5 percent of shares, wants US investor Stanley Kroenke to take control of the club, but this proposal does not find sufficient support among the other board members, and Dein departs. (BBC 8/31/2007)

Leeds United enters administration due to debts of £35m that it cannot pay. In return, the Football League imposes a 10-point penalty on the club. Before the points deduction, it was all but mathematically certain that Leeds would be relegated from the Championship to the third tier of English football, as the club required a series of freak results on the last day of the season to stay up. However, relegation to League One is now a mathematical certainty. Had Leeds gone into administration after the last game of the season, the penalty would have been applied at the start of the next term. The auditing firm KPMG is appointed Leeds’ administrators and immediately agrees to sell the club back to chairman Ken Bates without the debt burden. The Independent writes of the administration and sale, “in effect Leeds could wipe out most of their £35m debt at a stroke, and suffer no meaningful penalty.” (Harris 5/5/2007) However, due to a breach of league rules governing the conduct of the administration, the club will be deducted a further 15 points at the start of next season (see August 3, 2007).

Former Thai Prime Minister Thaksin Shinawatra loges a £81.6m formal takeover bid for football club Manchester City. The offer is made through a company called UK Sports Investments, a vehicle indirectly controlled by Shinawatra, his son, and his daughter. (BBC 6/21/2007) Since he was overthrown by a military coup last September, Shinawatra has been dogged by allegations covering assorted instances of corruption, human rights abuses, and running death squads as a part of his government’s war on drugs. (Ferguson 6/22/2007) Thai prosecutors have already filed corruption charges and frozen some of his assets. (BBC 6/21/2007)

Former Thai Prime Minister Thaksin Shinawatra completes his takeover of Manchester City. Shinawatra, who was allegedly involved in corruption, human rights abuses, and death squads in his native Thailand, made a formal offer the previous month (see June 21, 2007). Shinawatra now owns 74.03 percent of shares through his UK Sports Investments vehicle, very close to the 75 percent he needs to take the football club off the stock market. The previous shareholders, including former chairman Francis Lee and the Rupert Murdoch-controlled BSkyB, were wary of selling to Shinawatra because of the allegations against him, but have been reassured. The only bar to Shinawatra assuming full control of the club is that he now has to pass the Premier League’s “fit and proper person” test (see Shortly After July 6, 2007). (BBC 7/6/2007)

Former Thai Prime Minister Thaksin Shinawatra passes the Premier League’s “fit and proper person” test and receives the green light to take full control of football club Manchester City. Shinawatra has already purchased a majority of shares (see July 6, 2007) and this is the last hurdle his takeover has to cross. Allegations that Shinawatra was involved in various instances of corruption, human rights abuses, and death squads (see June 21, 2007) apparently do not prevent him from passing the test. On July 11, one civil servant at the Foreign Office (FCO) will send an e-mail, later obtained by the Telegraph by Freedom of Information Act request, saying that the Premier League thinks that Shinawatra would probably pass the test on that day, and asking if the FCO has any information it could share on him. The FCO also says that the League never follows up on the request, although the League comments: “What we were told by the government was, as these were only allegations, they could offer no comment or advice that was not already in the public domain. Had they offered any form of briefing we would, of course, have accepted.” (Bond 3/13/2008)

The Football League imposes a 15-point penalty on Leeds United due to irregularities in its administration. However, Leeds will be allowed to play in League One, the third tier of English football, in the coming season. The club had entered administration at the end of last year, incurring a 10-point penalty that was meaningless because the club was virtually certain of relegation at that time (see May 4, 2007). (BBC 8/3/2007)

Alisher Usmanov, a Uzbek-Russian businessman of dubious repute (see September 2, 2007), becomes a leading shareholder in Arsenal. Together with his associate Farhad Moshiri, a London-based Iranian, Usmanov purchases a 14.5 percent interest in the football club through the company Red & White Holdings for £75m. The stake is purchased from David Dein, who left the club’s board in April when he fell out with other directors over the lack of foreign investment in Arsenal (see April 2007). Dein was previously close to Arsenal manager Arsene Wenger, who is now reported to approve of the transaction. The deal makes Red & White Holdings the third largest shareholder in Arsenal, behind Danny Fiszman (24.11 percent) and Nina Bracewell-Smith (15.9 percent). The US businessman Stan Kroenke holds 12.9 percent; nobody else has more than 5 percent. (BBC 8/31/2007)

Former British ambassador to Uzbekistan Craig Murray accuses new Arsenal shareholder Alisher Usmanov (see Shortly Before August 31, 2007) of a string of crimes in a piece posted to his blog. (Craig Murray 9/2/2007) Murray learned of Uzbek affairs during his time as ambassador in 2002-2004, but was removed from his position under a cloud after he complained too loudly about the use of torture in the “war on terror.” (Grey 2007, pp. 152-169) In a no-holds-barred post entitled “Alisher Usmanov, Potential Arsenal Chairman, is a Vicious Thug, Criminal, Racketeer, Heroin Trafficker, and Accused Rapist,” Murray sets out Usmanov’s many alleged sins, including his activities as an underworld boss, influence peddling with Uzbekistan’s ruling clan, bribery, and a “particularly atrocious rape.” (Craig Murray 9/2/2007)

Alisher Usmanov, an Uzbek-Russian businessman who has just purchased an interest in the London football club Arsenal (see Shortly Before August 31, 2007), uses the law firm Schillings to shut down discussion of his controversial past on the Internet. Shortly after Usmanov became an Arsenal shareholder, former British ambassador to Uzbekistan Craig Murray published a blog post saying that Usmanov had committed numerous crimes (see September 2, 2007). Schillings now contacts several independent Arsenal supporters’ websites and blogs to make them remove postings referencing Murray’s allegations. The law firm tells them that repeating the allegations is “false, indefensible, and grossly defamatory.” Most sites comply. Although Schillings forces Murray’s webhost to remove the post, it does not contact Murray himself. (Kelso 9/13/2007)

Arsenal shareholder Alisher Usmanov temporarily shuts down the website of Boris Johnson, the Conservative candidate for major of London, in a dispute between Usmanov and former British ambassador to Uzbekistan Craig Murray. Usmanov has numerous other websites shut down as well. Following the purchase of an interest in Arsenal by Usmanov, an Uzbek-Russian businessman (see Shortly Before August 31, 2007), Murray made numerous allegations against him (see September 2, 2007), and Usmanov used the law firm Schillings in an attempt to shut down discussion of them on the Internet (see Shortly After September 2, 2007). Schillings now pressures Murray’s webhost, Fasthosts Internet, to act against Murray, and it responds by cutting off services to Murray and numerous other bloggers who simply share some technical services with him, even though they had not written about Usmanov or been the subject of a complaint by him. Johnson calls the action “a serious erosion of free speech,” adding: “This is London, not Uzbekistan.… It is unbelievable that a website can be wiped out on the say-so of some tycoon. We live in a world where Internet communication is increasingly vital, and this is a serious erosion of free speech.” Bob Piper, another affected blogger and local Labour Party politician in Birmingham, calls the situation “outrageous.” (Tryhorn 9/20/2007)

FC Barcelona wins a £2.1 million lawsuit against Fran Merida, a player who left the football club when he was 16, later joining Arsenal FC. Merida is found not to have honored a pre-contractual agreement he had with the Catalan giants. Spanish clubs cannot sign youth players until they are 18, whereas clubs in England can sign 16-year-olds under British law, meaning that some Spanish players sign for English clubs on turning 16. (Bright 10/11/2007) Arsenal will decide not to appeal the ruling and pay the fine for Merida. Reportedly, this decision is taken to improve relations between the two clubs, which have been poor since a similar problem with Cesc Fabregas’s move to London in 2003. (Draper 10/31/2009)

John McBeth, a former chairman of the Scottish Football Association, says that Jack Warner, a top FIFA executive and president of the Trinidad and Tobago Football Association, asked for a fee for an international friendly match in 2004 to be paid into his personal bank account. “Trinidad and Tobago came to play Scotland at Hibernian’s ground in Easter Road in Edinburgh,” says McBeth. “And after the game he asked me to make a check out to his personal account for the game. And I said ‘We don’t do that, it should go to the association.’ I then found out later that he’d approached several other staff in my organization—to do exactly the same thing.” Warner denies the allegations. McBeth had previously been withdrawn as a potential FIFA executive committee member after making comments alleging corruption in football circles in Africa and the Carribean. (BBC 10/29/2007)

Italian policeman Luigi Spaccarotella shoots and kills Lazio fan Gabriele Sandri. The shooting occurs at a motorway service station near Arezzo in Tuscany where, following clashes between fans of Lazio and Juventus, Spaccarotella discharges his weapon twice. Spaccarotella will later say that he did not intend to kill Sandri, who is sitting peacefully in a friend’s car when he is killed. (Kington 11/11/2007; Sky News 7/15/2009) Spaccarotella will be convicted of manslaughter, receiving a six-year sentence. (Sky News 7/15/2009) As news of the shooting spreads, numerous violent incidents break out around Italy. Following the postponement of Lazio’s game at Internazionale in Milan, hundreds of away fans throw stones at a police station and Inter fans also demonstrate. Outside Rome’s Olympic stadium, fans throw firecrackers, set up street barricades, and clash with police. About 10 officers are injured. Atalanta’s game with AC Milan in Bergamo has to be abandoned seven minutes after kick-off as fans try to smash down a glass barrier and invade the pitch. Roma’s game with Cagliari is also called off. (Kington 11/11/2007)

UEFA approves several changes to the Champions League and other competitions it runs.
bullet The final of the Champions League will take place on a Saturday, instead of a Wednesday, from 2010. UEFA justifies the change by saying more children will be able to see the game. “I also hope that playing the UEFA Champions League final on a Saturday will give families, especially children, the chance to see the game,” says UEFA president Michel Platini. (BBC 11/30/2007) The change of game day also means that the match, which is played in the late evening in Europe, is at a much more attractive time for the US market—2:45 p.m. Eastern Standard Time on Saturday. This means that the game will become one of only a few such club football games ever shown live on US network television. (FoxSoccer 5/17/2010) The cheapest child ticket for the 2011 Champions League final will be £113, will have to be purchased together with an adult ticket costing £225, and will be subject to a £26 “administration fee” (see February 17, 2011).
bullet Qualification for the Champions League is altered, making it harder for a fourth team from the three leading countries to qualify, to the benefit of smaller countries.
bullet The group stage in UEFA’s second most important club competition, the UEFA Cup, is altered, and there will now be 12 groups of four teams before the knockout stages.
bullet UEFA’s third-string competition, the Intertoto Cup, is abolished. (BBC 11/30/2007)

Deloitte publishes its Football Money League rankings for the 2006-2007 season. The rankings of the top 20 European clubs and their football earnings are:
(1) Real Madrid (€351.0m)
(2) Manchester United (€315.2m)
(3) FC Barcelona (€290.1m)
(4) Chelsea (€283.0m)
(5) Arsenal (€263.9m)
(6) AC Milan (€227.2m)
(7) Bayern Munich (€223.3m)
(8) Liverpool (€198.9m)
(9) Internazionale (€195.0m)
(10) AS Roma (€157.6m)
(11) Tottenham Hotspur (€153.1m)
(12) Juventus (€145.2m)
(13) Olympique Lyonnais (€140.6m)
(14) Newcastle United (€129.4m)
(15) Hamburg SV (€120.4m)
(16) Schalke 04 (€114.3m)
(17) Celtic (€111.8m)
(18) Valencia (€107.6m)
(19) Olympique de Marseille (€99.0m)
(20) Werder Bremen (€97.3m) (Deloitte 2/14/2008 pdf file)

Chelsea announces a loss of £74.8m for the 2007-08 football season. The figures show a 25 percent increase in turnover, to £190.5m, making the club second only to Manchester United in the Premier League, but the loss fell by only 7 percent compared to the previous season (see February 19, 2007). Chief executive Peter Kenyon allows that the club’s aim of breaking even by 2010 is “ambitious,” but adds: “I don’t think it’s something we are postponing, but it’s always been ambitious. We are determined to meet it, or get as close as we can.” (Kelso 2/22/2008) The club will actually make a loss of over £70m in the 2009-10 season (see January 31, 2011).

Alisher Usmanov, a Uzbek-Russian businessman of dubious repute (see September 2, 2007) who now owns a 24 percent stake in Arsenal (see Shortly Before August 31, 2007), says he only plans to increase his interest by a small amount. According to Usmanov, the investment vehicle Red & White Holdings, of which he is a co-owner, wants a blocking stake in the football club, which would be 25 percent plus one share. This would give it a veto on major club issues. (Reuters 2/27/2008)

On the eve of a crucial European Parliament vote on FIFA’s “6+5” rule to limit the number of foreigners fielded by football clubs, the organization’s president Sepp Blatter holds a roundtable with journalists to promote the regulation. Blatter says that the rule is intended to “protect minors, protect youth training, adapt the transfer system to today’s realities, and ensure tighter control over the actions of players’ agents.” In addition, it will help keep national teams strong and allow youth players to play for their original clubs. Blatter says the rule does not conflict with well-established European Union legislation on the free movement of labor, because “[c]lubs will still be free to take on as many foreign players as they want. When a match kicks off however, they will have to have six players on the pitch who are eligible for the national team of the country in question.” Blatter is critical of UEFA’s 4+4 “home-grown player rule,” as it “does not protect players who are eligible for the national team of the club in question,” and under this system “the richest clubs would merely have to buy players at an even younger age than they are currently doing.” He also points out that on average the five main European leagues (Germany, England, Spain, France, and Italy) already mostly comply with the “6+5” rule, so it would not make much difference to them anyway. Blatter claims that 80 percent of revenues generated by the Champions League go to the competing clubs, and that the “6+5” rule would lead to more equitable distribution, although the mechanism by which this would occur is unclear. Blatter acknowledges that there will be problems implementing the rule, but cites support from other sports organizations and says FIFA needs “to convince the world and the media.” (FIFA 5/7/2008) The European Parliament vote will go against the “6+5” rule 518 to 49 (see May 8, 2008).

The European Parliament votes 518 to 49 against allowing football authorities to implement the “6+5” proposal, which would limit the number of foreigners fielded by football clubs. The “6+5” rule was championed by FIFA, in particular its president Sepp Blatter (see November 27, 2006 and December 4, 2006). However, the parliament approves the “home-grown player rule” pur forward by UEFA. The “home-grown player rule” is different in that it is the country in which the player was trained, not his nationality that is decisive. Opposition to the “6+5” rule is grounded in the fact that it is in clear conflict with European Union legislation on the free movement of labour (see November 2, 2006). (Independent 5/9/2008)

FIFA’s 58th Congress votes 155-5 to support the organization’s “6+5” proposal to limit the number of foreigners appearing for football clubs. In addition to supporting the proposal’s aims, the congress asks the presidents of FIFA and UEFA to continue to try to find ways of implementing the rule in Europe. A number of speakers at the congress also express support, although UEFA president Michel Platini points out that “6+5 is considered illegal within the European Union.” At this time the proposal is planned to be phased in, meaning a maximum of seven foreigners in club teams’ starting lineups in 2010-2011, six the next season, and five the season after that. (FIFA 5/30/2008)

UEFA’s control and disciplinary body rules that the Portuguese champions FC Porto will not be admitted to the Champions League next season, due to allegations of bribery of referees in Portuguese domestic matches in 2003/04. In two cases, the Portuguese champions were recently deducted a total of six points and fined €150,000 by the Portuguese league’s disciplinary committee. Under UEFA rules, clubs may not be involved in any activity aimed at arranging or influencing the outcome of a match at national or international level, otherwise they will not be allowed into European competition. (UEFA 6/4/2008)

An Israeli newspaper publishes a list of the assets of fugitive gun runner Arkadi Gaydamak indicating that they include Portsmouth FC. The claim is made in an article called “Look What I’ve Got,” published by the tabloid Yedioth Ahronot. (Szczepanik 9/15/2008) The asset listing includes “Soccer Abroad: Portsmouth FC, in England’s top league… managed by Gaydamak’s son, Sacha [Alexandre].” (Conn 9/23/2008) The article’s publication follows claims that Arkadi is in financial difficulties and is to show that his position remains strong. Previously, the football club reported it was owned by Arkadi’s son, Alexandre. The difference is significant because Arkadi may not pass the Premier League’s “fit and proper persons” test due to the warrant for his arrest on gunrunning charges. (Szczepanik 9/15/2008) The league will commence an investigation into the claims (see September 22, 2008), but drop it when Portsmouth assures it Alexandre is the real owner (see September 23, 2008).

The Premier League launches an investigation into the ownership of Portsmouth FC. The investigation is spurred by an Israeli newspaper article that lists the assets of fugitive Russian-Israeli arms dealer Arkadi Gaydamak, which the paper says include Portsmouth (see (September 8, 2008)). Portsmouth says it is owned by Arkadi’s son Alexandre. The difference is important because Arkadi is wanted in France on gunrunning charges, meaning he may not pass the league’s “fit and proper persons” test for football club owners. (Conn 9/23/2008) Portsmouth will soon repeat that Alexandre is the real owner, satisfying the league (see September 23, 2008).

The Premier League announces it is satisfied that Portsmouth FC is not owned by fugitive gun runner Arkadi Gaydamak, but by his son Alexandre. The league had launched an inquiry into the ownership of Portsmouth after a list of Arkadi’s assets—including Portsmouth—appeared in the Israeli press (see (September 8, 2008) and September 22, 2008). As Arkadi is a fugitive from French authorities over gun running charges, he may not pass the Premier League’s “fit and proper persons” test for football club owners. Following the list’s publication, the league contacted Portsmouth to ask who really owned it, and Portsmouth said it was owned by Alexandre, satisfying the league. (Daily Mail 9/23/2008)

Two European commissioners restate their opposition to FIFA’s “6+5” proposal to restrict the number of foreigners fielded by football teams. The statement is issued following a meeting of European sports ministers that FIFA attended. The opposition of Vladimir Spidla and Jan Figel, European commissioners for employment and education respectively, is grounded in the fact that the rule “is based on direct discrimination on the grounds of nationality, and is thus against one of the fundamental principles of EU law.” However, the two commissioners remain “open to discuss ways and means of bringing more balance to the game of football together with FIFA and other interested parties to find a solution that would be compatible with EU law.” Regarding a proposal made by football authorities to ban international transfers of players aged under 18, they have some sympathy for the idea, but “free movement of workers is a fundamental principle of the EU. And a proposal to ban all transfers of under-18s would, at first sight, appear to constitute indirect discrimination in the field of free movement of workers and could be disproportionate in light of the objectives pursued.” (European Commission 11/28/2008)

Leeds United chairman Ken Bates falsely claims to the Royal Court of Jersey that he jointly owns Forward Sports Fund, the company that owns Leeds. According to Bates, there are two “management shares” in Forward; he has one, whereas the other is held by his financial advisor Patrick Murrin, who is based in the offshore tax haven of Guernsey. Forward is registered in the Cayman Islands, another tax haven. However, it will later emerge that the two “management shares” do not entail ownership of Forward, and Bates does not hold either of them (Murrin has one, and Peter Boatman, a Geneva-based administrator, has the other). Forward is actually owned by the holders of 10,000 shares in it. Bates will correct this statement later in the year, calling it an “error.” It is unclear how Bates, an experienced businessman, came to believe he was the part-owner of a business worth several million pounds, when he apparently has no interest in it. (Conn 9/30/2009)

The Constitutional Court of the Czech Republic confirms a CZK 70,000 (approx. €3,000) fine imposed on corrupt football referee Lubomir Pucek for helping fix a match in the Slovak league between Banska Bystrica and Puchov in 2003. Pucek was found guilty of discussing a bribe with another official over the telephone by a district court, and the verdict has already been confirmed by a regional court. However, Pucek appealed a second time on the grounds that courts have no business fining football referees for corruption, as this was a private matter. The Constitutional Court is of another opinion. “Football competitions should be regarded as a society-wide phenomenon and this fact should be given expresion in the form of an interest in their fairness and proper conduct, excluding the intentional influencing of match results,” says the Constitutional Court. Before his fall, Pucek won the Crystal Whistle for the Czech league’s best referee five times. (Mladá fronta DNES 1/12/2009)

Deloitte publishes its Football Money League rankings for the 2007-2008 season. The rankings of the top 20 European clubs and their football earnings are:
(1) Real Madrid (€365.8m)
(2) Manchester United (€324.8m)
(3) FC Barcelona (€308.8m)
(4) Bayern Munich (€295.3m)
(5) Chelsea (€268.9m)
(6) Arsenal (€264.4m)
(7) Liverpool (€210.9m)
(8) AC Milan (€209.5m)
(9) AS Roma (€175.4m)
(10) Internazionale (€172.9m)
(11) Juventus (€167.5m)
(12) Olympique Lyonnais (€155.7m)
(13) Schalke 04 (€148.4m)
(14) Tottenham Hotspur (€145.0m)
(15) Hamburger SV (€127.9m)
(16) Olympique de Marseille (€126.8m)
(17) Newcastle United (€125.6m)
(18) VfB Stuttgart (€111.5m)
(19) Fenerbahce (€111.3m)
(20) Manchester City (€104.0m) (Deloitte 2/13/2009)

Chelsea announces that the club lost £65.7m in the 2007-08 football season, down from the £74m lost the previous season. The club generated revenues of €268.9m in the 2007-2008 season (see February 2009). Chelsea chief executive Peter Kenyon says, “There is no doubt that the positive upward trends of turnover and the continued reduction in losses shows that Chelsea is building a strong business base to build on in what will be challenging times.” (BBC 2/13/2009)

Alisher Usmanov, an Uzbek businessman of dubious repute (see September 2, 2007), increases his interest in Arsenal, an English Premier League football club in North London. Red & White Holdings, of which Usmanov is a co-owner, raises its shareholding to 25 percent, which gives it a veto over major decisions. The company, run by former Arsenal vice chairman David Dein, first bought an interest in Arsenal in 2007 (see Shortly Before August 31, 2007). Red & White Holdings is now the largest shareholder in Arsenal, followed by Danny Fiszman (24.11 percent), Nina Bracewell-Smith (15.9 percent), and Stan Kroenke (12.4 percent). Shares in Arsenal are currently changing hands for around £7,500, down from their peak of around £10,500 a year and a half ago. If Usmanov’s interest reaches 30 percent, he will be mandated to launch a takeover bid under Stock Exchange rules. (Jacob 2/17/2009)

UEFA president Michel Platini (see January 26, 2007) addresses the European Parliament in Brussels and outlines his program as head of the governing body of the continent’s most popular sport. Platini advocates the idea of financial fair play, which he says will lead to competitive balance in European competitions. He also insists that football should not be treated as an economic activity, and that the sport’s specific nature should be recognised officially. Furthermore, the UEFA president calls, among other things, for a ban on the movement abroad of people who play football but are under the age of 18. Regarding the specific nature of football, Platini argues that certain laws governing the rest of society should not apply to the game because such application is based on “the false equation that professional sport equals a purely economic activity.” (UEFA 2/22/2009)

A report ordered by FIFA from the Institute for European Affairs (INEA) is published stating that FIFA’s “6+5” rule to limit the number of foreigners fielded by football clubs is not illegal under Europan Union law, despite repeated European Union statements to the contrary (see May 8, 2008 and November 28, 2008). “There is no conflict with European law,” INEA chairman Professor Jurgen Gramke tells a press conference. “The 6+5 rule does not impinge on the core area of the right to freedom of movement. The rule is merely a rule of the game declared in the general interest of sport in order to improve the sporting balance between clubs and associations.” The report says that, at worst, the 6+5 rule could constitute “indirect discrimination” because “it is not directly based on the nationality of professional players.” (Institute for European Affairs 10/24/2008 pdf file; Wilson 2/26/2009)

FIFA’s Dispute Resolution Chamber hands down a ruling punishing the Swiss club FC Sion and its Egyptian goalkeeper Essam El Hadary over Al Hadary’s transfer from the Egyptian club Al Ahly in February 2008. The goalkeeper is banned for four months, starting from the next season, and Sion is ordered to pay Al Ahly a transfer fee of US$1.25 million and also prevented from registering new players for two transfer windows, i.e. more than a year. The move was illegal under FIFA regulations because El Hadary was under contract with Al Ahly and there was no agreement between the clubs. FC Sion says it will appeal the ruling. (BBC 6/2/2009; Court of Arbitration for Sport 6/1/2010 pdf file)

Arsenal’s board of directors turns down a proposal that the football club raise capital by means of a rights issue. The suggestion was put forward by Red & White Holdings, an investment vehicle co-owned by the controversial Uzbek businessman Alisher Usmanov (see September 2, 2007). Under the plan, all shareholders would be invited to subscribe new shares, but if one or more did not exercise this right, the additional shares would be offered to the other shareholders. Red & White Holdings says that the extra money would be used to repay some of the club’s debt and to finance additional signings of established players. However, club officials suspect this is a ploy to allow Usmanov to increase his stake. In addition, they say the debt is manageable and that they prefer to sign young players, who are cheaper. (Fifield 7/8/2009)

Leeds United bans all Guardian reporters from its stadium, Elland Road. The ban is in response to a series of articles written by Guardian columnist David Conn about the mystery of who actually owns Leeds. (Conn 10/19/2009) For example, three weeks previously Conn published an article highlighting the fact that the club’s chairman, the controversial Ken Bates, had falsely claimed to own the club (see January 2009). Leeds is owned by Forward Sports Fund, a company registered in the Cayman Islands and administered by the Geneva-based Chateau Fiduciaire. However, the public does not know who owns Forward Sports Fund. According to Conn, the question of Forward’s ownership is important because of the role it played in the club’s insolvency in 2007. (Conn 9/30/2009)

The Spanish government announces that the “Beckham law” will cease to apply on January 1, 2010. The law was passed in 2005 in order to lure top foreign executives to Spain by giving them a massive tax break (see 2005). However, most of the people who took advantage of the law were footballers, in particular England and Real Madrid midfielder David Beckham. The law’s repeal will lead to Spanish clubs having to pay foreign players more in future, creating a more level playing field for signings with clubs in other European countries. (Xinhua News Agency (Beijing) 11/4/2009)

The controversial Russian-Uzbek businessman Alisher Usmanov (see September 2, 2007) increases his stake in English football club Arsenal. The shareholding is held by the investment vehicle Red & White Holdings, of which Usmanov is co-owner, and is now just over 26 percent. This makes Usmanov’s company the second largest shareholder in Arsenal, behind US businessman Stan Kroenke, who now has 29.9 percent. (BBC 12/11/2009)

Chelsea announces that the club made a loss of £44m the previous season. This is the smallest loss since the football club was taken over by Roman Abramovich in 2003 and was achieved despite a fall in turnover from £213.1m to £206.4m. Chief executive Ron Gourlay comments, “It is still our aim to be self-sufficient and we will achieve this by increasing our revenues as we continue to leverage off our brand.” (Fifield 12/30/2009)

Andy Anson, chief executive of the English bid team for the 2018 World Cup says that of the 24 members of FIFA’s executive committee who will vote on the World Cup’s allocation, “at least 13 are buyable.” The comments are made to a closed gathering of senior civil servants, including a Downing Street representative, a few journalists, and other members of the bid team at a dinner party in a private room of the InterContinental hotel in Mayfair, London. Anson makes the statement in response to a question about corruption at FIFA, adding that he and his team had come to this conclusion after much thought. According to Patrick Collins, a Daily Mail journalist present: “[Anson’s] colleagues coughed loudly and fixed him with incinerating glares. Somebody explained that the notion of ‘buying’ delegates had never crossed English minds. Anson realised the import of his remark and started to retract. Later, we were spun the line that things had been said which could easily be taken the wrong way.” Following the World Cup’s allocation to Russia, Collins will publish details of the conversation, despite the fact that it was conducted on an off-the-record basis. He will say he is doing so because by its reaction to the numerous corruption allegations made against FIFA during the bidding process the bid team “so lightly shed integrity and self-respect.” (Collins 12/5/2010)

FC Moscow withdraws from the Russian first division just over one month before the football season begins. The withdrawal is announced by Sports Projects, a subsidiary of the club’s owners Norilsk Nickel. The reasons given for the withdrawal are that the parent company’s operations are based in other parts of Russia and support from Moscow city council is not forthcoming. FC Moscow was an offshoot of the famous FC Torpedo Moscow club and was founded in 1997. The club’s place in the league is to be taken by Alania Vladikavkaz. (CNN 2/5/2010)

Deloitte publishes its Football Money League rankings for the 2008-2009 season, in which Real Madrid was the first European club to earn more than €400m. The rankings of the top 20 European clubs and their football earnings are:
(1) Real Madrid (€401.4m)
(2) FC Barcelona (€365.9m)
(3) Manchester United (€327.0m)
(4) Bayern Munich (€289.5m)
(5) Arsenal (€263.0m)
(6) Chelsea (€242.3m)
(7) Liverpool (€217.0m)
(8) Juventus (€203.2m)
(9) Internazionale (€196.5m)
(10) AC Milan (€196.5m)
(11) Hamburger SV (€146.7m)
(12) AS Roma (€146.4m)
(13) Olympique Lyonnais (€139.6m)
(14) Olympique de Marseille (€133.2m)
(15) Tottenham Hotspur (€132.7m)
(16) Schalke 04 (€124.5m)
(17) Werder Bremen (€114.7m)
(18) Borussia Dortmund (€103.5m)
(19) Manchester City (€102.2m)
(20) Newcastle United (€101.0m) (Deloitte 3/2010 pdf file)

The Premier League deducts nine points from Portsmouth because the club, which is insolvent, is to go into administration. Portsmouth previously had 19 points, but now has only 10, 14 less than 19th-placed Hull. The deduction therefore virtually guarantees that Portsmouth will be one of the three teams relegated to the second tier of English football when the season ends in two months’ time. A Premier League statement says, “Following the High Court’s decision that Portsmouth FC’s administration is valid, the Premier League board convened today to apply the League’s rules and policies in relation to a member club suffering an event of insolvency.” Portsmouth’s debts are said to be around £65m. (Daily Telegraph 3/17/2010)

The Football Association agrees England will play an international friendly match in Thailand in the summer of 2011 in an attempt to influence the vote of Worawi Makudi, a Thai member of FIFA’s executive committee that is to vote on the hosts of the 2018 World Cup. This game is one a series of matches designed by England to influence executive committee votes; such matches will also be played with Egypt as well as Trinidad and Tobago. (Mackay 4/23/2010) However, Makudi will vote for the Spain/Portugal bid (see Around 2:00 p.m. December 2, 2010) and England will then cancel the game in Thailand (see December 3, 2010).

Lord Triesman, the chairman of the English FA and 2018 World Cup bid, makes several allegations about corruption and bad practice in football over lunch with a former lover. The woman, Melissa Jacobs, records the conversation and will later provide it to the Mail on Sunday for publication. Triesman, a former government minister and member of the House of Lords, says that there is “some evidence” Spain and Russia may collude over the forthcoming World Cup in South Africa and their bids to host the 2018 event—according to him, in return for Russia helping bribe referees in the current tournament, Spain will withdraw its offer to host the later tournament, leaving the way clear for Russia to win. Triesman also claims that one Latin American football administrator wants an honorary knighthood from the Queen in order to vote for England. In addition, Triesman is dismissive of the Premier League’s fit and proper persons test for club owners, pointing out that, given the way it is designed, notorious Zimbabwean dictator Robert Mugage would pass the test, whereas Nobel Peace Prize winner Nelson Mandela would not. (Gallagher 5/17/2011) After the Mail on Sunday publishes the allegations, Triesman will resign from both his positions (see May 16, 2010).

Lord Triesman resigns from his positions as chairman of the Football Association and the 2018 England World Cup bid following the publication by the Mail on Sunday of allegations of corruption he made privately (see (May 2, 2010)). The allegations were made over lunch with a former lover, Melissa Jacobs, who recorded the conversation and then provided it to the Mail. Most explosively, Triesman suggested Spain might drop its bid to host the 2018 World Cup if Russia helped ensure referees were favorable to it at the 2010 World Cup. This would leave the way clearer for Russia to host the 2018 event. “A private conversation with someone whom I thought to be a friend was taped without my knowledge and passed to a national newspaper,” says Triesman in a statement. “That same friend has also chosen to greatly exaggerate the extent of our friendship. In that conversation I commentated on speculation circulating about conspiracies around the world. Those comments were never intended to be taken seriously, as indeed is the case with many private conversations. Entrapment, especially by a friend, is an unpleasant experience both for my family and me but it leaves me with no alternative but to resign.” (BBC 5/16/2010)

University of Barcelona professor Jose Maria Gay publishes a report into the finances of Spanish football clubs. The report paints a grim picture, showing that the 20 La Liga clubs owed a total of €3.5bn in the 2008-2009 season, a €40m increase from the previous term. The report also shows the slowing pace of revenue growth in 2008-2009—down from 10 percent to 4 percent—and total expenses of €1.7bn, up €249m. Salary costs, in particular player wages, accounted for 85 percent of turnover. (Maidment 5/19/2010)

Real Mallorca, which finished fifth in the recently concluded La Liga season, applies to go into bankruptcy administration. The club has a debt of €85m (US$103m). Majority shareholder Mateu Alemany comments: “Over the past two years, Mallorca has suffered a very complex economic situation, with serious financial problems and an inability to meet its commitments. This is a legal instrument that enables Mallorca to see the future in another way—to have a budget structure that has logic and controls debt, to take stringent budgetary measures to bring spending in line with earning capacity.” According to a recently published report into Spanish football finances (see May 18, 2010), Mallorca made a loss of €5.2m for the 2008-2009 season, on revenues of €28.1m. Its playing staff budget for the 2009-2010 season was €34.6m. (Maidment 5/19/2010)

The Swiss club FC Sion signs a number of players in the summer transfer window. It does so before a ban on signing players it is soon to be under takes effect (see June 1, 2010). The players are Loïc Chatton (signed from Biel), Steven Deana (Vaduz), Michael Dingsdag (Heerenveen), Jonas Elmer (Aarau), Rodrigo Lacerda (Strasbourg), Branislav Micic (Le Mont), Dragan Mrdja (Vojvodina), and George Ogararu (Ajax Amsterdam). (Swiss Football League 2010)

The Court of Arbitration for Sport rules against the Swiss club FC Sion and its goalkeeper Essam El Hadary in a dispute over the player’s transfer from the Egyptian club Al Ahly two years ago. The decision confirms a ruling of FIFA’s Dispute Resolution Chamber (see April 16, 2009) that ordered compensation to be paid to Al Ahly for the transfer and banned Sion from signing new players for two transfer windows. Although the original ruling is altered in some minor ways, the transfer ban remains in force. (Court of Arbitration for Sport 6/1/2010 pdf file)

Businessman Sandro Rosell is elected president of Spanish football club FC Barcelona, succeeding Joan Laporta, who had been in charge for seven years. Rosell, a former Barcelona vice president who resigned in 2005 after arguing with Laporta, wins more than 60 percent of votes cast by club members. (BBC 6/13/2010)

Sheikh Abdullah Bin Nassar Al-Thani, a member of the Qatari royal family, agrees to buy a majority stake in Malaga football club for €36m from current president Fernando Sanz. “The agreement has already been notified to the Spanish Sports Council and will be completed shortly, given that said public body has provided its verbal approval of the agreement’s terms and conditions,” says the club. Al-Thani, who will also assume the club’s debt, is extremely wealthy and manages a business empire based in the United Arab Emirates, which employs around 3,000 people and operates in more than 30 countries. His interests include hotel chains, shopping centres, mobile phone companies, car dealerships, and a bank. Malaga’s highest ever finish in the Spanish top flight is seventh, and they have been relegated to the second tier frequently. They recently finished 17th out of 20 clubs in Spain’s Premiera Division. Al-Thani comments, “Our goal is to help Malaga take the necessary steps to consolidate its presence in La Liga and to reinforce the excitement and hopes of the supporters.” (Reuters 6/26/2011)

FC Barcelona takes out a €150m loan to cover the football club’s expenses. The need for the loan was announced a week before it was taken out, when newly elected club president Sandro Rosell said the loan was to pay wages for players, coaching staff, and other employees. The loan is provided by a group of Spanish banks headed by Santander and La Caixa. (Press Association (London) 7/14/2010)

UEFA bans the Spanish football club Real Mallorca from European competition because it is not in compliance with its financial regulations. Mallorca has had a successful season and qualified for the Europa League, but went into administration in May (see (May 19, 2010)). Villareal is set to take Mallorca’s place in the competition if an appeal is unsuccessful. (Cutler 7/23/2010)

Real Mallorca appeals to the Union of European Football Associations (UEFA) to reverse a recent decision banning the club from next season’s Europa League. The club was banned from European competition (see (July 22, 2010)) because it is currently in administration and not in compliance with UEFA’s financial guidelines (see (May 19, 2010)). At the same time as the appeal, Mallorca issues a statement pointing out that the ban will make its financial situation worse, as it would deprive the club “of a series of revenue in different concepts, such as ticketing, sponsorship, and income from the competition.” It adds, “Ethically and legally, RCD Mallorca believes reason is on their side and [the club] will not relent in the effort to show that he has earned the right to challenge the Europa League.” (Watts 7/26/2010)

UEFA upholds a decision banning Spanish football team Real Mallorca from European competition (see (May 19, 2010), (July 22, 2010), and July 26, 2010). “At its meeting on July 14, 2010, the club financial control panel unanimously concluded that the licence had not been correctly awarded to RCD Mallorca and that the club did not sufficiently fulfil its financial obligations,” says UEFA of the reason for the ban. Mallorca indicates that it will appeal to the Court of Arbitration for Sport. (AFP 7/30/2010)

Arsenal announces record pre-tax profits of £56m for the 2009-2010 season, although a large amount of the club’s revenues was generated by the club’s property development side. Turnover increased to a record £379.9m from £313.3m, although the club’s overall turnover from its football business was marginally down, owing to five fewer home cup matches, as well as reduced income from merchandising and catering. The wage bill increased from £104m to £110.7m and is now around 50 per cent of non-property income. The club says that the business’s property arm, the Highbury Square development, is debt free and making money. The sale of 362 apartments at Highbury Square and the social housing at Queensland Road, developments that were part of the recent move to a new stadium, generated revenues of £156.9m and allowed Arsenal to repay in full the £129.6m in bank loans taken to fund the construction. The group’s overall net debt was reduced from £297.7m to £135.6m. (Gibson 9/24/2010) Arsenal is one of only four Premier League clubs to make a profit for the 2009-2010 season, when the clubs’ losses totalled £484m. (Conn 5/19/2011)

Manchester United announces a record operating profit of over £100m for the 2009-2010 football season, but it is more than offset by loans taken on when the club was purchased by the Glazer family. The record profit was helped by increases in commercial, broadcasting, and matchday revenues, the later boosted by increased ticket prices. Nevertheless, the club made a huge overall loss due to interest repayments and one-off costs related to a £509m bond issue. In addition to the bonds, the club also has to service £225m in payment in kind loans, currently bearing interest at 16.25 per cent. The overall result was also harmed by a £40.6m write-down on an interest rate swap that had to be paid when the club launched its bond offer at the beginning of the year, as well as £19m lost on fluctuating exchange rates. (Gibson 10/8/2010)

Czech businessman and former Dukla Prague owner Bohumir Duricko guns down alleged underworld figure Vaclav Kocka Jr. The shooting occurs at the prestigious Monarch restaurant in Prague, at the launch of a book by former Social Democrat Prime Minister Jiri Paroubek. Paroubek, an acquaintance of Duricko’s, has left the building when the shooting occurs. (Mlada fronta DNES 10/10/2008)

FC Barcelona president Sandro Rosell announces that in the previous season the football club made a record loss of €79.6m and that its debt has climbed to €430m. Rosell also proposes that the club file suit against previous president Joan Laporta over dubious bookkeeping practices, a proposal that is approved by a narrow majority at the general assembly of club’s members. According to Rosell, when he took over from Laporta (see June 13, 2010), he had the club’s books checked by outside auditors. The results of the audit led him to propose the action against Laporta, with whom he has been in conflict for several years. (Shaw 10/16/2010)

Former World Cup-winning captain and coach Franz Beckenbauer, now a member of FIFA’s executive committee that will vote on the 2018 and 2022 World Cup hosts, backs Australia’s bid to organize the 2022 event. “Australia was a perfect host for the Olympics,” Beckenbauer says. “They know how to handle these big events. The football World Cup—it’s even bigger than the Olympics because it’s more cities, it’s more spectacular than the Olympics—I think you can do it.” He adds: “Australia has shown the world many, many times that [they] can handle these big events. There is no doubt that Australia can host the World Cup and organise the World Cup.” (Fox Sports 10/26/2010) Beckenbauer does not specifically say he will vote for Australia, but it seems likely that the one vote it will get is from him (see Around 2:30 p.m. December 2, 2010).

Mohamed bin Hammam, president of the Asian Football Confederation and a senior member of FIFA’s executive committee that is soon to vote on the allocation of the 2018 and 2022 World Cups, criticizes a Sunday Times investigation which recently revealed two of his fellow committee members were corrupt. The investigation led to the suspension of the two men, Nigeria’s Amos Adamu and Tahiti’s Reynald Temarii, from the committee, after they agreed to accept money from Sunday Times reporters posing as lobbyists to vote a certain way. “Forging identity, fabricating evidence, and setting traps are unethical behaviours in my point of view,” says bin Hammam. “One thing about Middle East media, these are rare happenings there. Is it ethical to use unethical measures to protect the ethic? How can we serve justice and look for fairness by not acting justly and fairly? How will we clean dirty laundry by using dirty water?” (Daily Mail 11/2/2010)

UEFA president Michel Platini returns to Turin to visit his old club Juventus and speaks of his love for it. “Juventus is always a great emotion,” says Platini. “I have to be neutral in the stadium though because it is a competition for all European clubs. On the outside it’s like this, but inside I have a different feeling.” He also speaks warmly of the club’s new president, Andrea Agnelli, nephew of former president Gianni Agnelli, saying, “Juventus fans dream of having success after problems, and it would not be the real Juventus without Agnelli.” (Landolina 11/5/2010)

Some Spanish football clubs fail to back a proposed agreement on how to share income from collectively-sold domestic television rights from the 2015-16 season. Under the agreement, the largest two Spanish clubs, Read Madrid and Barcelona, would share 34 percent of all income, Atletico Madrid and Valencia would share 11 percent, the remaining 16 top-tier Spanish clubs would split 45 percent equally, and there would be parachute payments for relegated clubs. The proposal is opposed by Sevilla, Zaragoza, Villarreal, Real Sociedad, Athletic Bilbao, and Espanyol, with Malaga undecided. “Only Real Madrid and Barcelona stand to gain from this,” says Sevilla president Jose Maria del Nido, spokesman for the rebels. “The two giants have earned €1,500 million more than the next club in the last 10 years, and with this agreement in place four clubs—Real Madrid, Barcelona, Atletico Madrid, and Valencia—will all earn more in the next six years than a team that finishes third in the league.” The rebels propose a different agreement under which revenue would be shared more equally. “Of the 79 leagues played 51 have been won by Real Madrid or Barcelona, which is 65 percent against 35 percent for the rest,” adds del Nido. “In the last 10 years the two big clubs have won 80 percent of the titles with 20 percent for the rest. And most significantly, in the last five years only these two have won the title. If this continues the league title will have been sold in advance for the next 10 years.” (Redshaw 11/18/2010)

The South American Football Confederation, Comnebol, decides that the three representatives of its members on FIFA’s executive committee will vote for the Spain/Portugal bid to host the 2018 World Cup. (Guardian 11/24/2010) The three representatives are Julio Grondona (Argentina), Ricardo Teixeira (Brazil), and Nicolas Leoz (Paraguay). (BBC 12/2/2010)

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