Examining the Rise of State-Owned Soccer Clubs

Financially speaking, club soccer is inherently unequal. In comparison to American sports leagues, which have established salary caps and regulations that teams must adhere to, soccer allows for teams with wealthier owners to spend almost as much as they like. The establishment of the UEFA Financial Fair Play Regulations (FFP) in 2009 was meant to be a landmark decision in addressing problems facing European clubs, yet these laws were never meant to even the playing field. Rather, FFP aims to prevent clubs from spending more than they earn, a common practice up until that point as teams gambled with their finances in hopes of promotion to a higher league or qualification for the UEFA Champions League, for example, which would bring considerable additional revenue. A 2009 UEFA review found that more than half of all European clubs were losing money on an annual basis, with roughly 20% of these clubs thought to be losing money at an unsustainable rate.

Presently, clubs are slightly more financially secure across the board compared to the pre-FFP era, yet inequality has only grown due to the unprecedented levels of spending from certain top clubs, especially those who are directly or indirectly state-owned. PSG, controlled by the Emir of Qatar since 2011, as well as Manchester City, controlled by Sheikh Mansour of UAE since 2008, were the #2 and #3 highest net spenders on transfers since 2012, sitting only behind historic giants Manchester United. The idea that a club can almost “buy success” is off-putting to many soccer fans, as despite there being a financially unequal nature to the sport, this was usually due to teams having sustained periods of success and a rich history. Yet, the case of Manchester City of such a phenomenon, as they were a historically average club that was in the the third tier of the English Football League as recently as 1999, but has since won the Premier League title six times since their Emirati takeover. 

While the controversy surrounding state-owned clubs has usually centered on its effects to the game itself, the political nature of a nation owning a team has been discussed in recent years due to accusations of sportswashing, defined as the use of sports as a means to improve reputations tarnished by wrongdoing. Its use as a political instrument can be seen as early as the 1936 Olympics held in Nazi Germany, with the global love of sports proving to be incredibly effective in distracting the public away from controversy. The 2021 takeover of Newcastle United by the Public Investment Fund (PIF) of Saudi Arabia came under considerable scrutiny in the UK due to the extensive corruption and human rights violations committed by the Saudi monarchy. Many saw their presence in the Premier League, along with their other major investments in sports such as the LIV Golf tour, as a way to improve its public image, and the sale was under the threat of failing for months due to pressures from other clubs and the public to prevent the deal from going through. Yet, as a recent article from The Athletic revealed, the British government had a vested interest in sealing the deal due to their burgeoning economic relationship; emails from the British Foreign Office showed a plan from the PIF to invest $30 billion over a 10-year period into the UK.

Where soccer will go from here is unclear; there have been extensive violations of FFP from teams like Man City and PSG, with recent charges against City claiming over 100 breaches of regulations over the last decade. Yet punishments in the past have usually been limited to fines, which serves little to no purpose when dealing with clubs that have nearly unlimited resources. Addressing the political sphere is incredibly important too, as instances of obvious corruption are still too commonplace; the decisions to award the 2018 and 2022 World Cups to Russia and Qatar, respectively, serve as a reminder of the extensive corruption and sportswashing present in soccer’s highest organizations. For fans new to the game these developments truly taint the image of the world’s most popular sport, what’s meant to be the beautiful game, and provide an additional layer of inequality that goes a step too far.