BUENOS AIRES, Argentina (AP) — Argentina’s tax chief laid out new rules Thursday aimed at reducing tax evasion and money laundering in soccer, the country’s sacred national pastime.
Ricardo Echegaray has made Argentina’s soccer clubs responsible, starting Friday, for putting the profits from player transfers into special bank accounts. Player contracts must be reported along with these profits, and the investors and agents involved must be registered as representing the player. If any of the income or other information they declare doesn’t match, the tax agency will block those responsible from operating within Argentina’s financial system.
Argentina is the world’s top exporter of soccer players, generating hundreds of millions of dollars in profits as thousands of players are transferred from team to team each year. But Echegaray says the players themselves are often cheated by shadowy businessmen hiding their cash, and their clubs are put at a major disadvantage as powerful financial interests control the cash that drives the game.
This is the fruition of the rampant reliance of all parties on third party player ownership, wherein agents, sports management companies, and dodgy investor groups purchase the economic rights to a player and reap the rewards of any potential transfer. It ostensibly benefits Argentinian clubs who may not otherwise be able to compete for the signature of younger star players, but it’s also susceptible to abuse, with transfer monies leaving the country to far and away global interests, who are often concealed.
Earlier this week, Michel Platini reaffirmed his desire to ban third-party ownership outright in Europe:
[Platini] wants to end the third-party ownership of players’ transfer rights but that is being fiercely opposed by agents who contend it would be a disaster for smaller clubs who depend on outside financing to secure big names.
The issue came up repeatedly at a two-day football conference in Dubai with several agents complaining the issue was being mischaracterised in the press and that imposing a ban – which is already in place in France and England – would only serve to further widen the gap between big and small clubs.
Platini would presumably say that the egregious transfer fee inflation permitted by clubs able to spend well in excess of turnover is the disease, and that third-party ownership an unfortunate symptom. Ideally, instead of hoping for a cheap buy from a third party owner, smaller clubs would turn to the old, less flashy method of developing young stars to sell on to bigger clubs in order to help boost their finances, and, with good management, their on-field fortunes.
But whatever, money is money, and the Kia Joorabchians still need to peddle the phony line about helping out the little guy while they rake in money that rightfully belongs both to the player and the clubs they sell to.