By Mark Baber
May 8 – Brazilian clubs, fighting proposals to ban third party ownership of players, face a new threat from their own government which is proposing to ban the controversial practice.
The Brazilian government, in an emailed statement from the Sports Ministry, are preparing a proposal to ban clubs from selling player transfer rights to investors.
Brazilian clubs have, according to member of the lower house sports committee Vicente Candido, unpaid tax bills amounting to $2 billion. Much of this sum is believed to be related to third-party ownership plans, to which an estimated 90% of elite Brazilian players are subject, and which have constituted a major source of financing for Brazilian clubs.
On 22 April, a group of 21 Brazilian teams wrote an open letter to FIFA, [http://twitdoc.com/upload/mottamarcos/tpo-open-letter-south-america-english-version.pdf ] copied to the Brazilian Sports Ministry, setting out their strong opposition to moves by UEFA and forces within FIFA to abolish third party ownership.
A number of agencies and investment funds involved in the business, often based in off-shore tax havens, argue the transactions are a legitimate form of lending and little different to the system of loaning players between clubs.
Jochen Loesch, president of international business at Traffic Sports, one company which has invested more than $75m in the rights of about 60 players since 2007, told Bloomberg in March, that any global ban “will be widely ignored by the market”, and that any such ban would not withstand legal action.
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