A New Era for Clubs
Argentina has taken a significant step towards modernising its football landscape. By authorising the transformation of clubs into corporations and allowing civil associations and foundations to become shareholders, the country is opening the door to private capital in the sport. This move marks a pivotal moment in Argentina’s football history, one that could reshape the management and financial structures of clubs across the nation.
New Rules for Club Transformation
The change comes as part of Articles 346 and 347 of Emergency Decree No. 70/2023, signed at the beginning of President Javier Milei’s administration. These provisions are designed to initiate economic reforms, with football at the forefront of this new direction.
According to the decree, civil associations and foundations can now hold shares in corporations. This is a major shift from the previous model, where clubs were typically run as non-profit organisations. The decree also simplifies the registration process for common good entities incorporated abroad, enabling them to more easily conduct their activities within Argentina.
The Role of Private Capital
The decree’s impact extends beyond just allowing associations to hold shares. It also paves the way for clubs to voluntarily accept private capital contributions. This means that companies can now manage football entities, bringing a new level of professional management and potentially more significant investment into the sport.
Both corporations and partnerships limited by shares are eligible to be part of these newly formed football corporations. However, non-profit entities are restricted to participation in corporations only. This distinction preserves the integrity and mission of non-profit organizations, even as they actively engage in football’s commercial aspects.
Decision-Making Power Remains with Members
Despite these changes, the decree safeguards the rights of club members. Members must secure a two-thirds vote for any club to transform into a commercial entity or partner with a corporation. This ensures the club’s community controls the decision to embrace private capital, preventing top-down imposition.
Members must also vote on any changes to the functioning or composition of social or sports entities. This approach balances the introduction of private capital with the need to maintain democratic control within the clubs.
A New Era for Argentine Football
Argentina’s decision to open its football clubs to private capital marks the beginning of a new era. This move should attract significant investment, enhance club management, and potentially improve the quality of football in the country. However, this shift challenges us to ensure the sport’s community roots and member control remain intact throughout the process.
As the country navigates this transition, the world will be watching to see how Argentina’s football clubs evolve in response to these groundbreaking changes. The balance between tradition and innovation will be key to the success of this new approach.
360 Business Law can assist with the content of this blog by offering expert legal insights on the complexities of transforming football clubs into corporations. They can provide clarity on the legal frameworks involved, such as compliance with the relevant articles of the Emergency Decree, the process of accepting private capital, and the implications for civil associations and foundations. Their expertise ensures that the blog accurately reflects the legal considerations and best practices for clubs navigating this significant transition.