The remarkable sports purchasing spree by Saudi Arabia, coupled with Emirati and Qatari purchases of European clubs, could transform the game, but not in the ways that Crown Prince Mohammed bin Salman and other Gulf leaders like Qatar’s Emir Tamim bin Hamad Al Thani had hoped.
The outcome of a complaint made by Spain’s premier soccer league, La Liga, to the European Commission may determine how the Gulf has an impact on European and international soccer. The accusation claims that Paris Saint-Germain (PSG), which is owned by Qatar, received alleged state aid from Qatar that distorted markets in the European Union by paying above-market prices for star players.
President of La Liga Javier Tebas frequently cites the US$260 million that PSG spent on Brazilian footballer Neymar in 2017 and the US$160 million that they spent to keep Kylian Mbappé. Neymar relocated earlier this month for $100 million to Al Hilal in Saudi Arabia.
La Liga claimed that it made its protest under recently passed legislation governing foreign subsidies by the European Union. The regulations provide the Commission the authority to look into the funding of non-EU firms doing business in Europe and “redress, if needed, their distortive effects.”
La Liga said in a statement that it “has filed a complaint alleging that PSG has received foreign subsidies from the State of Qatar, which have allowed it to improve its competitive position, thereby generating significant distortions in several national and EU markets.”
La Liga claimed that “this enables them to boost their sporting performance, as well as affecting the ability of rival clubs to recruit.”
Even though Britain is no longer subject to European laws and regulations after Brexit, a successful La Liga complaint would put more pressure on the English Premier League and the British government to take similar action against Saudi Arabia-owned Newcastle United and United Arab Emirates-owned Manchester City.
Gulf-focused human rights organizations urged the English Premier League and the British government earlier this month to make sure that state-aligned owners of clubs are prohibited from exercising ownership control, citing Newcastle, Manchester City, and Qatar’s potential purchase of Manchester United as examples.
ALQST for Human Rights, Emirates Detainees Advocacy Centre (EDAC), European Saudi Organization for Human Rights (ESOHR), Gulf Centre for Human Rights (GCHR), and International Campaign for Freedom in the United Arab Emirates (ICFUAE) are among the organizations involved.
The groups expressed their concerns in letters to Premier League CEO Richard Masters, British state secretary for culture, media, and sport Lucy Frazer, and state minister for business and trade Nigel Huddleston, saying they were “concerned that the political, social, and cultural power associated with ownership of top English football clubs grants foreign states undue influence and provides cover for state authorities that continue to flagrantly commit grave human rights abuses.”
“It is imperative that the Premier League adopt and implement sufficiently objective and robust ownership criteria to prohibit the takeover of English football clubs by individuals or entities susceptible to the influence of state actors or associated with human rights violations,” they emphasized.
Newcastle may turn out to be exceptionally weak. Newcastle is owned by a sovereign wealth fund, similar to Paris Saint-Germain, in contrast to Manchester City.
In Newcastle’s instance, it is the Public Investment Fund (PIF) of Saudi Arabia, which is led by Mr. Bin Salman.
The Premier League claimed to have “legally binding assurances that the Kingdom of Saudi Arabia will not control Newcastle United” when the fund acquired Newcastle, but it would not elaborate on these assurances.
According to human rights advocates, a California court filing in a case involving the PGA Tour, the organizer of golf’s marquee events, and LIV Golf, a PIF-owned start-up, brings the promises into question.
According to the filing, the PIF is a “sovereign instrumentality of the Kingdom of Saudi Arabia.” According to the filing, the Fund’s governor, Yasir al-Rumayyan, who also serves as chairman of Newcastle, is “a sitting minister of the Saudi government.”
After PGA and LIV Golf decided to join, the legal matter was dismissed.
The Saudi player acquisition blitz, which has brought the kingdom 15 foreign players, including superstars Cristiano Ronaldo, Karim Benzema, and Neymar, has ruffled European soccer’s feathers.
With Saudi Arabia’s Al Ittihad seeking, so far unsuccessfully, to woo Liverpool’s Mohammed Saleh, club manager Jurgen Klopp has urged FIFA to ensure the kingdom follows Europe’s transfer market.
“It’s difficult for everyone, and we have to learn to deal with it… However, the authorities should make it plain that if you want to be a part of the system, you must do your business at the same time as everyone else… I’m very sure FIFA could do it clicks fingertips. “I’m not sure they want to, but they could,” added Mr. Klopp.
The Premier League’s transfer window closes on September 1st, while the Saudi window remains open until September 20th.
Mr. Klopp’s pessimism is understandable. FIFA anticipates increased revenue when the revamped Club World Cup debuts in 2025.
An inflow of high-profile Saudi clubs would be welcomed. Al-Hilal, the champion of the 2021 Asian Champions League and the world’s biggest net spender at the moment, has already qualified.
To be honest, Newcastle’s ownership by Saudi Arabia has benefited the club in a variety of ways.
The club’s day-to-day managers, Amanda Staveley, Mehrdad Ghodoussi, and Jamie Reuben, are minority co-owners who have increased employee morale and professionalized the club’s women’s team.
The Premier League’s transfer window closes on September 1st, while the Saudi window remains open until September 20th.
They raised the living wage over the minimum wage, increased staffing, and spent $500 million on new player signings.
PSG was acquired by Qatar Sports Investments, a subsidiary of the Qatar Investment Authority, the Gulf state’s sovereign wealth fund, in the same way that Newcastle was.
In the case of Manchester City, the boundary between public and private investment is hazy.
The team is owned by the City Football Group, with the Abu Dhabi United Group for Development and Investment (ADUG) holding an 81% share.
In turn, Sheikh Mansour bin Zayed Al Nahyan, a senior Abu Dhabi ruling family member and Minister of Presidential Affairs for the UAE, owns ADUG, an example of the Gulf state’s troublesome handling of possible conflicts of interest.
City Football Group created a new corporate business model for global soccer with its franchise shares in other teams in the United States, Australia, India, Japan, Spain, Brazil, Uruguay, China, Belgium, France, and Italy.
La Liga’s complaint to the European Commission calls that model into question, even if the Commission’s writ is limited to EU members Belgium, France, Italy, and Spain.
