The European Commission have today confirmed that Real Madrid, Barcelona and five other Spanish clubs are under investigation for illegal state aid.
Spain’s foreign minister Jose Manuel Garcia-Margallo revealed on Monday evening the impending proceedings and today the EC’s Competition Commissioner Joaquin Almunia has confirmed further points.
Commenting that clubs cannot ‘live at the expense of the taxpayer’, Almunia is heading a probe into whether or not Barca, Madrid, Valencia, Elche, Hercules, Athletic Bilbao and Osasuna have benefited from illegal state aid.
It is confirmed that Barca, Madrid, Athletic and Osasuna’s ‘possible tax privileges’ are being looked at, as they are not registered corporations like the 16 other teams in the Primera Division.
Instead categorised as ‘non-profit entities’, they have faced tax rates at 25 per cent rather than the 30 per cent rate clubs with SAD status pay. No figures were released in today’s report on the sums this quartet is believed to have saved as a result.
Meanwhile, the EC also report that Elche, Valencia and Hercules are being assessed for seeing the Valencian government guaranteeing bank loans totalling €118m, taken out between 2009 and 2013, ‘at a time when these teams were in financial difficulties’.
“These were financed through state resources and give an advantage to certain clubs in economic activities within the market of the EU,” continued today’s report released.
Madrid are also facing scrutiny for the purchase of land that their training facilities are constructed on.
“Real Madrid seems to have benefited from a very advantageous land swap with the city of Madrid, which was based on a new appraisal of land valued at €22.7m instead of its previous value of €595,000 in 1998.”
The Commission’s report today concluded: “The Commission has concerns that these measures provided significant advantages to the beneficiary clubs to the detriment of the clubs which have to operate without such support.”
However, the Commission does not list an investigation into the role of public funding for the construction of Athletic Bilbao’s new San Mames, as Garcia-Margallo had originally reported.