The background to the red card on Spanish football subsidies
It looks as if the days of dodgy deals in Spanish football are over following the European Commission investigation we reported on yesterday. In particular, interest has focused on a land transfer between Real Madrid and the city administration. A land swap in 2011 saw a plot of land with a supposed value of €598,000 in 1998 revalued at €22.7m.
The Commission's general objective is to seek an end to an era in club football in which lucrative commercial enterprises attract the world's top talent at the expense of taxpayers. Real Madrid and Barcelona are the two richest football clubs in the world according to Deloitte.
It should be noted that a concurrent investigation into five clubs in the Netherlands did not find evidence of illegal state support.
The Financial Times commented on Saturday, 'The commission decision regarding Real Madrid brings to and a long-running saga that casts a stark light on the nexus of sport, business and capital in the Spanish capital.'
The Pink 'Un also commented, 'The land deal has been held up as a symbol of the close relationship between local politicians and the powerful businessmen who run Spain's largest football clubs. But the sheer number of clubs caught up in the commission investigation highlights how politicians at both state and regional level have been keen to support their local teams.'
The FT noted, 'Valencia, a city that has been rocked by political corruption scandals, and whose team was almost sunk by a towering debt load in 2013, is another prominent example.'
It is interesting that the Commission delayed announcing the results of the investigation until after the Spanish general election. That saw a move back to the traditional established parties, apparently in response to the shock of Brexit.
The government of Catalonia is trying to turn their province into an independent state and FC Barcelona is a focus of Catalonian identity. The Spanish prime minister has been annoyed by Scottish First Minister Nicola Sturgeon grandstanding in Brussels and has made it clear that they will give Scotland no favours. Much the same goes for Belgium.