Research Group for European Law

State aid and football clubs – playing according to the (State aid) rules

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On 22 October, the EFTA Surveillance Authority, ESA, opened an in-depth investigation into the building of a new stadium for the Norwegian football club, Sandefjord Fotball AS, and the transactions linked to it.

In this context, one should recall that the Commission is currently investigating a number of cases involving the question of aid in favour of football clubs. These are, i.a., Barcelona CF, Real Madrid CF, Athletic Club Bilbao, Club Atlético Osasuna, Valencia CF, Hercules CF and Elche CF. The measures granted to them involve guarantees for bank loans, real property swaps and possible privileges regarding corporate taxation. For more information, see the press release of 18 December 2013, Commission opens in-depth investigation into public funding of certain Spanish professional football clubs European Commission - IP/13/1287.

As regards Sandefjord Fotball AS, in 2006, the municipality of Sandefjord transferred two plots of land free of charge to its subsidiaries. The transfer was never notified to ESA. In exchange, the football club was supposed to build a new stadium.

In order to acquire additional financing for the new stadium, the football club sold part of the land provided by the Sandefjord municipality to private investors. The price was set at NOK 40 million. Following a number of complaints, ESA decided to investigate whether this transfer of land entails state aid, and if so, whether such aid is in line with the EEA Agreement. The formal investigation procedure is necessary as ESA is not convinced by the information provided by the Norwegian authorities regarding the question of whether the transfer of land took place on market terms. ESA has also doubts as to the market value of the plots of land at issue. In addition, ESA will require more information from the Norwegian authorities in order to assess whether any aid granted to the club is in line with the EEA state aid rules.

As clarified by Ms Oda Helen Sletnes, president of ESA, «Financial assistance to professional sport clubs can be permitted in order to promote sport activities and infrastructure, provided that certain conditions are respected. However, in this case, the Authority has not yet received information allowing us to conclude that this transfer of land did not entail illegal state aid».

The new stadium was completed in July 2007. The total cost reached NOK 100 million. Sandefjord Fotball AS has since sold the stadium.

The Norwegian authorities, as well as third parties with an interest in the case, are now invited to provide their comments. A non-confidential version of the opening decision will shortly be published on ESA’s website and in the Official Journal of the European Union.