WHO ARE SOCIOS? THE MEN BEHIND FLORENTINO PEREZ AND JOAN LAPORTA'S POWER

Ownership in football is a complex and controversial subject. There are many models of ownership prevalent in different parts of the world. Many top clubs in Europe are privately owned by businessmen, such as Manchester United, Liverpool and Chelsea. In Germany, there is a 50+1 rule which establishes fan’s control over 51% of the club’s stakes.

Another model of ownership can be seen at Paris saint-Germain and Manchester City which are a state owned clubs by Qatar and Abu Dhabi respectively. and are among the four clubs that are currently owned by ‘Socios’.

WHO ARE SOCIOS

In 20th century Spain, the football clubs were owned by club members called ‘Socios’. Fans used to apply to become a Socio by paying an annual subscription among other eligibility criterions which varied from club to club, this model built a harmonious relation between the club and its fans because among other benefits it gave a sense of belonging to the fans.

This model however, was changed when the Spanish government brought the “Law 10/1990”. The Article 19.1 of this law made it mandatory for professional football clubs to become privately-owned PLCs, June 1992 onwards. The law created an exception for the clubs who can show that it was turning a profit for the previous five years starting from season 1985/86. This was audited by the LFP (Liga de Fútbol Profesional).

 

Current LFP President Javier Tebas (Courtesy: Marca/Website)

 

WHICH CLUBS ARE OWNED BY SOCIOS

As a result, only four clubs could continue their operations as member-owned non-profit sports associations. These were – Real Madrid, FC Barcelona, and CA . Real Madrid currently have around 91,000 socios while Barcelona have approximately 1,41,000 socios.

Although Socios do not have much say in the club’s decision making, they do elect the club’s president every four years, which makes sure the President is answerable to them. The president and his/her board members however are independent to take the club’s decisions such as transfers, debt management, sponsorship deals, financial loans etc.

HOW ARE SOCIO-OWNED CLUBS DIFFERENT

This model does well on the emotional and democratic part of the club-running process, but isn’t deemed financially viable.

DEMOCRATIC

The President elections which occur every four years are a chance for both the Socios and the aspiring candidates to take the club into the direction they want. The elections are done through a ballot-system. While one can’t deny that democracies also have flaws, it still provides scope for course correction that monarchies don’t.

For example, when Barca fans were unhappy with the functioning of the club, they elected a new president in Joan Laporta. On the other hand Man United fans do not have any control over who owns them. It’s clear to see who’s the merrier fanbase these days.

FINANCE

Socio-run clubs are not financially independent and cannot raise capital through public/private investment or floatation of shares on the stock market to fund player purchases and club operations, and are solely dependent on the club’s self-generated revenue through TV broadcasting rights, tickets and merchandise sale, transfers and sponsorship deals.

The lack of investor/shareholder scrutiny makes it mighty difficult to ensure financial fair practices and financial responsibilities.

 

 

The recent debt-figures of both Barcelona and Real Madrid point fingers towards the century old models. Both clubs despite being the 2 highest grossing clubs in the world owe a combined figure of nearly €2 billion in debts. This was one of the major reasons why the two clubs wanted the to get going.

The Socio’s nevertheless are proud of their historical and cultural method of running clubs as it binds them together.

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