State-owned companies to be banned to finance the purchase of sports stars from the budget

Professional sports clubs will be limited in the right to spend the money received from the state and state-owned companies. The ban will affect the cost of sports agents and payments related to transfers of players.
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The proposal "to exclude the possibility of using professional sports clubs sent to them in the prescribed manner of budget allocations for payment sports agents services [...] as well as any payments related to the transfer of professional athletes in professional sports clubs" in the draft Guidelines of the Budget Policy for 2016 and the planning period of 2017-2018 years (have RBC). Last Thursday, a document was approved at a meeting of the whole government.

The document shows that a similar ban is expected to extend to the use of money from the clubs of state corporations and companies in which more than 25% of the voting shares or share capital owned by the state.

The government-approved materials do not specify at what point the ban can enter into force.

This is the result of the working group, which was engaged in the preparation of meetings of the Council under the President of the Development of Physical Culture and Sports, on 3 June, said Deputy Finance Minister Airat RBC Farrakhov. According to himsaid that the proposal was part of the analytical report presented at the meeting. He was supported by the Council under the President of the Development of Physical Culture and Sports.

Why You Need

The essence of the ban is that budget funds are in some sense "labeled": they can be spent on a limited number of budget items - the development of football schools, club infrastructure, salary players. For transfers to clubs will have to find other means, explains the deputy vice-rector of HSE Dmitry Dagaev.

"Government funding should go to the maintenance of children's schools. It is not only the salary of the coach, shape, ammunition, safety of children, it is also a technical basis ", - welcomes the initiative of Vice-president of hockey club" Metallurg "(Magnitogorsk) Gennady Velichkin.

"Our clubs mostly live at the expense of budgetary funds, and in a situation where the budgets of the subjects of pop, to allocate the money to buy expensive Brazilians - reckless waste of our clubs have to move on a commercial basis", - says Vice-Speaker Gosdenwe LDPR, Igor Lebedev, claiming for the post of President of the Russian Football Union.

It will also help clear the market of known fraud schemes - perepodpisanie annual contracts providing for payment of "lured" to agents, and the purchase of mediocre players at inflated prices, hoping to head the faculty "Management in team sports" the RMA Nikita Matveev Business School.

According Dagaeva, in the same way is the Union of European Football Associations (UEFA), which is concerned that the sport was more like a business. "UEFA has introduced a few years ago the rules of financial fair play, on which you can spend on transfers as much money as the club makes, plus some limited amount," - says the expert.

Price issue

The approved document is not specified by the Government, of which the amounts involved. According Farrahova, assessment of professional sports clubs spending for these purposes is difficult, including because of the fact that the funds of state corporations, companies and organizations are recorded as vnebyudzhetnye costs.

"We sent a request to the actors to know how to spend money on football clubs. I can say that the whole country is billions of rubles ", - says Lebedev.

As the presentation of the former presidential candidate of the RFU Alisher Aminov on its website, in the football Premier League in 2011, the regional budget and state-owned companies have invested about € 800 million. In the 2012/13 season, this figure has increased by at least 30% to not less than € 1 billion in the structure of the budgets of the clubs most of the costs -. remuneration fund and transfer activities.

In May, the RFU president Nikolai Tolstoy quoted estimate that in 2014 the cost of Premier League and First Division clubs to international transfers amounted to 2.7 billion rubles. This is three times less than it was in 2012. The cost of agency activity, he said, fell in this period by 1.6 bn., Up to 624.3 million.

Experts say that, in varying degrees, the restriction will affect the majority of professional sports clubs. "Offhand," is half of the hockey club KHL, estimates Vyalichkin of "Metallurgist". According to him, segodI 25%, maximum 30% of their costs may discourage hockey club himself.

Director of the Center for Strategic Studies in the field of sports RG Plekhanov Ilya Solntsev explains the problem in the example of the Football National League, which unites clubs of the second division. The bulk of the clubs it is on the balance of the region, "sometimes 100%, sometimes less is financed from the regional budget." The budget of these clubs usually is 50 million rubles. and above, the lion's share falls on wages and transfers.

How to get around the ban

Circumvent the ban will be through the creation of intermediate fund between the state budget and the club or through funding through the "daughters" of state companies, suggests Nikita Matveev from RMA. Another option - contracts provision of advertising services: obtained them money from sponsors clubs spend at its discretion.

General sponsor of FC "Locomotive", RZD, do not spend money on transfers and agents, and allocates funds in the framework of sponsorship agreements - more clubs dispose of them at its discretion, said representationrer company.

"Bashneft" agree on the budget of the hockey club "Salavat Yulaev" and according to it lists sponsored contributions and controls the use of funds. The company does not directly spend money on transfers and payment agents. All costs associated with the transfers, the club bears its own, said the representative of the company Alexander Shadrin.

In "Gazprom" press service (sponsoring FC "Zenit") does not comment. According to a source in the company, "a recommendation - it's not the law." Most likely, the "Gazprom" will preserve the status quo in this matter: it will continue to sponsor professional sport, discussing with clubs spending on specific projects, as is the case today, he says.

VTB representative, the general sponsor of the football and hockey, "Dynamo", declined to comment. Earlier, Chairman of the Board of VTB Andrey Kostin has announced that from next season, the two clubs financing scheme changed: VTB move from club funding to finance the central "Dynamo" council.

There will be no trialLemma for sports agents, according to football agent Vladimir Abramov: "The commission agent, as a rule, does not exceed 10% of the transfer amount. A good agent will always find a way to get it. If Clu b warn him that by law can not pay itself, the amount can be obtained, for example, a football player through the oral agreement: lots of opportunities. " Both sides are interested in the player that the transition took place, says Abramov and agent services are the kind of performance guarantee obligations.

This is not the first attempt to limit public sector investment in professional sport. In 2013, the State Duma amended the law on natural monopolies, which forbade public monopolies to finance sports teams. It was proposed to direct funds that companies spend on these goals, the federal budget, and already from it to redistribute them in the interests of national teams, and other sports clubs. Since the document is in Parliament without movement.