French football is in financial crisis. The French Senate criticizes conflicts of interest, luxury, enrichment, bad economic decisions – and proposes changes.
In the summer, the French league association LFP – an organization comparable to the DFL in Germany – sold its national media rights under considerable time pressure. There is now less than 500 million euros in revenue per season for the next five seasons until 2029. It is a result that is far below the billion once targeted and that is increasingly leaving its mark.
A commission of the French Senate, which has a similar function to the Bundesrat in Germany, released a report on Tuesday about French professional football. The results of the two conservative senators Michel Savin and Laurent Lafon, who also wrote the report based on many discussions with experts: disastrous. “Mistakes were made and no lessons were learned.”said Savin at a media event. “Because mistakes continue to be made and they put the clubs in a very delicate position.” Savin sprach in der Zeitung “The World” also that he hopes “that several clubs do not have to stop operating”.
Senator Michel Savin, one of the report’s co-authors
Senate names problems: Conflicts of interest and waste
The report criticizes several problems:
The private equity company CVC joined LFP as an investor: The clubs received 1.5 billion euros for this – but 13 percent of their income from TV rights is permanently gone and goes to the investor. At that time, the LFP promised that revenue would more than double by 2032, making the business worthwhile for the league and the investor. In reality, the income is currently half of the hoped-for amount. “Very optimistic” was this business plan, the report says. Another problem: The contract does not expire; the obligation applies at least for the planned lifespan of a subsidiary founded to distribute the TV rights, which is 99 years. In their report, the senators note that the share of payments to CVC can rise to up to 20 percent. Another point of criticism: The money was distributed very unevenly: 200 million euros went to PSG, those relegated to Ligue 2 received 16.5 million.
There is criticism of conflicts of interest: According to the report, LFP boss Vincent Labrune received a bonus for the multi-part capital increase for completing the investor deal. “This is unprecedented”criticizes the report. “The LFP executives objectively had a vested interest in this decision, which they proposed to the board without proposing a credible alternative.” Labrune’s salary was almost tripled after the deal from 420,000 euros to 1.2 million euros, then later reduced again to 840,000 euros.
Another conflict of interest according to the report: Nasser Al-Khelaifi from Qatar is, on the one hand, president of Paris Saint-Germain and a board member of an LFP subsidiary for the sale of commercial rights. On the other hand, he is the managing director of the Qatari media group beIN Sports. beIN Sports bought parts of the current media rights. Al-Khelaifi’s presence at an LFP board meeting at which exclusive negotiations were decided with, among others, beIN Sports France, “is surprising to say the least”the report says. Al-Khelaifi did not agree to a hearing at the Senate’s request.
LFP managing director Vincent Labrune (l.), with Nasser Al-Khelaifi, who is managing director of beIN Sports and president of Paris Saint-Germain.
The league is living beyond its means, the Senators say: When the investor deal was concluded, the LFP bought a new headquarters in Paris for more than 130 million euros. With regard to the disappointing result of the sale of media rights 2024 to 2029, the report states: “It would have been wise to wait for the outcome of the sale of the rights.” The league’s lifestyle stands “in contrast to the financial situation of the clubs”said Senator Savin.
The LFP has not yet responded publicly to the report.
The office of the French league association LFP in Paris
Recommendations: Transparency, austerity and only one TV channel
The Senate report makes several recommendations for a better future.
- More control: The French Court of Auditors could take part in the financial review, the report says. All interests and assets of officials should also be disclosed.
- Only one TV channel: The report sees the need for reform of rights sales. “This reform must put the interests of consumers first”is it[called[called“In particular, it would be desirable to facilitate the allocation of audiovisual rights, if possible, to a single broadcaster rather than to several.” At the same time, the illegal distribution of the images should be declared a criminal offense.
- More economic efficiency: The maximum number of contract players should be limited to 30. Analogous to UEFA’s new Financial Fair Play and the financial regulations in Spain, the report recommends the introduction of a cost cap for clubs. The clubs should then only be allowed to put 70 percent of their income into their squads. The costs have increased enormously: Kylian Mbappé, now at Real Madrid, recently earned six million euros per month in Paris.
Stefanie Markert, Sportschau, May 11, 2024 9:33 a.m
Senator Savin pointed out further savings potential at the press conference. “If we see that the league is forced to make savings today, I think the first signal is that LFP President Labrine could go without money.” The report also calls for an upper limit of 450,000 euros for his position.
LFP-President Vincent Labrune
