Multi club ownership in football: Everything you need to know

All the questions related to Multi club ownership are answered here

A letter expressing concerns about "the integrity of the game" has been sent to UEFA's president Alexander Cerefin. Urging the governing body to block a potential Qatari takeover of Manchester United. The Glazer family, who are the current owners of Manchester United, put the club up for sale in November, and a Qatari group is said to be among the potential bidders. The Qatari group is reportedly interested in owning both Manchester United and Paris Saint-Germain through separate operating companies.

UEFA has a clear stance on state ownership of football clubs, as outlined in its statutes. According to UEFA, it is crucial to prevent any individual or entity from exerting control or influence over more than one club. Especially when the owners are states. UEFA believes that state ownership of football clubs poses a significant threat to the integrity of the game. As well as to its values and sustainability.

Here are some questions and answers which will help you to know everything about Multi Club Ownership.

Are football club owners allowed to buy other football clubs?

In England and Italy, football club owners are not allowed to own another club in the same country. Italy introduced a similar ban in 2021 after Salernitana, owned by Claudio Lotito who also owns Lazio, was promoted to Serie A. Lotito was required to place his ownership in a trust and sell his stake by Christmas. These rules also apply to clubs that do not play in the same division and minority shareholdings. Owners have until the 2024-25 season to divest themselves of their shares. According to Gabriele Gavrina, the president of the FIGC, no participation or absolute control of the company will be permitted.

If football club owners are not allowed to buy other football clubs in the same country. Why are we discussing the multi-club ownership model?

While football club owners are prohibited from owning more than one club in the same country. There are no rules against owning one club in multiple different countries. A 2021 study by Play The Game found that 15 English clubs were part of a multi-club system, the most of any country in Europe. The multi-club model is utilized by well-known operations such as City Football Group. Which owns clubs in various countries including England, the USA, China, Spain, Australia, Japan, Uruguay, Belgium, and India, as well as a partner club in Bolivia. Similarly, Red Bull owns clubs in Austria, Germany, the USA, and Brazil. While national federations have prohibited ownership of more than one club for various reasons, none have banned multi-club ownership. Some have even relaxed their foreign ownership rules in an attempt to close the gap between their clubs and those from the 'Big Five' European leagues.

What are the current rules in England regarding football club ownership?

In England, owners and directors of football clubs must pass the Owners & Directors Test, which applies to all directors and individuals with over a 30% shareholding. If someone owns more than this shareholding in another club, they would be ineligible to pass the fit and proper test. It is also forbidden for owners or directors of a football club to have the authority to influence the management of another club.

What is UEFA's position on multi-club ownership?

UEFA does not support multi-club ownership and has rules in place to prevent it. In 1998, UEFA launched an investigation into multi-club ownership when AEK Athens and Slavia Prague, both with the same majority shareholders, qualified for the UEFA Cup. The matter was eventually brought before the Court of Arbitration of Sport (CAS) in 1999, and a rule was introduced banning two clubs with the same majority shareholders from playing each other in the same European competition.

However, it should be noted that UEFA has different definitions of ownership compared to other organizations. UEFA integrity rules allow for one person or company to have a 100% shareholding in one club and a 'non-decisive influence' shareholding in another competing in the same competition, without violating the rules. After the CAS upheld the legality of the UEFA rule. The stipulation concerning 'decisive influence' was not initially part of the UEFA rules. However, it was later added to ensure there was a catch-all provision to prevent common ownership under the 50.1% threshold. This helps to prevent the concern that a company or person can have a 100% and a 49% shareholding in two clubs in the same UEFA competition.

What are the reasons for UEFA's opposition to multi-club ownership and wouldn't being owned by people who already own richer clubs secure the smaller club's future?

UEFA is opposed to multi-club ownership as it creates a potential conflict of interest and can lead to a situation where one club becomes a feeder to the other. The smaller club could end up having its ambitions tempered in perpetuity. Resulting in two tiers of football clubs within the game. Additionally, a lower division club being bought by a Premier League club may not make much of a difference if the chances of them meeting competitively are negligible.

However, there are also instances of clubs being plunged into crisis as a result of the withdrawal of their owners. In Denmark, overseas investors leaving two clubs, Naestved and Vendsyssel. This led to an investigation by the Danish FA into foreign ownership. Furthermore, an owner with a large portfolio of football clubs might view them as disposable if they are not returning the expected profits.

What are the challenges associated with multi club ownership structures?

Running multiple clubs under the same ownership structure can pose several challenges, such as operating in different jurisdictions with varying business environments, managing different fan expectations and cultures, and the financial costs of managing a loss-making club. Additionally, feeder clubs may become unpopular with supporters, and this can pose significant challenges to the owners.

What motivates some owners to run multiple football clubs?

There are various reasons why some owners choose to run multiple football clubs. Including diversifying their business portfolio and reducing financial risk, expanding their brand, sportswashing, seeking global exposure, and facilitating player movements between clubs. However, it is important to note that despite the growing popularity of this approach to club ownership. It is not the prevalent model in Europe or other regions.

Can we expect multi-club ownership to become more accepted by the ultra-wealthy in the future?

It appears that the likelihood of this happening is low. As UEFA and most major European leagues are currently resistant to the idea. It is even possible that the rules may become more restrictive rather than less so. Furthermore, the notion of football being entirely controlled by a small number of corporations with many different brands seems unlikely.