By Samindra Kunti
August 5 – Brazilian president Dilma Rousseff (pictured) may veto medida provisoria 671 that will allow for the refinancing of Brazilians clubs’s debts, but implements new rules for better management and more transparency.
The Brazilian congress and senate, where votes were symbolically not counted, approved medida provisoria 671 earlier this month. From August 3 onwards president Rousseff had 15 days to approve or veto the measure.
Medida provisoria 671 is a compromise between Brazil’s elected MP’s and the country’s top football administrators, heavily backed by the leading clubs in metropolitan hubs Sao Paulo and Rio de Janeiro, and the Brazilian Football Confederation CBF.
Under pressure the deputies and senators softened the requirement that clubs may no longer operate with a deficit on the books to a gradual implementation by 2021. Clubs can run a deficit of 10% until 2017 and 5% by 2019.
The initial proposal was for a zero-deficit-tolerance in 2021, with the notable exception of clubs, which annually do not exceed a revenue of €1.4 million. The medida provisoria maintains the ‘Selic tax’, a basic levy on interests, to correct the installments of clubs’s debts.
“We are not anesthetizing the clubs, which pay their debts in 240 months, complying with the Selic tax,” said PDT senator Zeze Perrella, a former president of Cruzeiro. “Today the government receives nothing from the clubs. The most important element of the medida provisoria is the concern with saving the football clubs and the responsibility that it gives to club presidents for a less reckless management.”
The medida provisoria also determines that a maximum of 80% of the annual gate receipts can be spent on professional football. Initially 70% had been proposed to give women’s football a bigger boost to develop, but congressmen, linked to the CBF, opposed it.
It also requires that club presidents’ mandate be limited to four years, with a possible reelection for another term. Furthermore clubs will need to regulate their fiscal department and contracts with players more.
Senators have urged the president to veto the measure. Dilma is widely expected to do so, according to reports in the Brazilian media.
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