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It's that game again

Posted by Helen Wednesday, August 04, 2004

Yes, it’s football again. Anyone would think I was obsessed with it. (Though I have noted that the English season started last week. You can’t miss these events if you live opposite a stadium.)

It is clear that there are ramifications to football that most of us had never suspected, and I do not mean the extra-curricular activity that seems to have gone on in the FA.

According to the Financial Times a state-aid probe is being conducted by the Commission into the financial affairs of football teams in Germany, Italy, Spain, france and the UK. (Why not the others, one asks oneself.) Tobias Buck reports:

The European Commission inquiry, which is still at a preliminary stage, focuses on three issues: property deals and public help in constructing football stadiums; tax breaks for clubs; and state assistance in paying social security charges.
There have been various investigations in the past and they came to nothing either because the cases collapsed or, as in Italy, the law was changed. This time the Commission seems determined. It is looking into property transactions connected with Real Madrid and Bayern München, among others. It seems that various kinds of local government assistance and tax breaks made it possible for these teams to buy new stadia and new players.

However, it is pertinent to ask on what basis precisely is the Commission looking into these affairs. A spokesman for Mario Monti, the Competition Commissioner, said that football was a “core economic activity which causes a lot of complaints and which we need to pursue”. It does cause a lot of complaints, many of them to do with the referee’s ability to see straight but how does that concern Monti?

The competition Monti is supposed to be dealing with is economic, not sporting. When he looks at state subsidies or tax breaks or other perks doled out to favoured companies by embattled governments, he is supposed to be making sure that there is a level playing field (whatever that may be) between all the EU competitors and, also, that the consumer is not cheated.

None of this applies to football teams. AC Milan, Real Madrid, Chelsea or the various Spartacus teams are not in direct competition with each other economically speaking. Each caters for its own customers or clients. A supporter of one team is not going to support another one just because of a better stadium. The games are watched because of the way they come up in the various competitions not because of the players that happen to have been bought. Advertising follows popularity.

One could argue, of course, that football teams should finance themselves (though why should they have no tax breaks when other companies do) but that is not what the European Commission is saying, as far as one can make out. The Commission is making out a case for the funding to be at least centrally controlled and, perhaps, in the fullness of time, centrally disbursed.

This raises an interesting question: will the Commission start investigating the funding of other institutions within the broad area of sport and culture? Will Monti or his successor look at opera companies or circuses? What about the money that is being pumped into the various Olympic bids?

In the EU Constitution the Union extends its sway over sport, having added the following sentence to the existing Article 149, to create a new Article III-182:
The Union shall contribute to the promotion of European sporting issues, given the social and educational function of sport.
Unsurprisingly, the first contribution is another attempt to control.