Catalonian Independence and its Potential Impact on FC Barcelona

By: Dylan Thompson*

On October 1, 2017 the region of Catalonia held a referendum for independence that triggered violent intervention from the Spanish government.[1]  Citing the unconstitutionality of the proposed vote, the Spanish authorities took extreme measures to prevent the vote from taking place.[2] These measures included cutting internet and power certain areas and directing national police officers, armed with truncheons and rubber bullets, to suppress the voting process and subsequent celebrations.[3]

Somewhat lost in the violence that day was the almost empty 98,000 seat soccer stadium, where F.C. Barcelona played an official league match against Las Palmas.[4] Fears of potential riots and violence had prompted the closure of the stadium to fans, so Lionel Messi and the other Barcelona players won 3-0 in front of an empty Camp Nou.[5]  Despite the Catalonian team’s requests for the game to be rescheduled, the Madrid based La Liga officials insisted the game be played as scheduled. [6]

Naturally, because of Barcelona’s prominence not just in La Liga, but also in global soccer, questions were asked about the long-term consequences of Catalonia’s bid for independence. If the bid was successful, would Barcelona continue playing in Spanish league?

La Liga President, Javier Tebas, recently said that if Catalonia did gain independence, all Catalonian teams would no longer be able to participate in any of the Spanish leagues.[7] Fortunately for soccer fans around the world, it is extremely likely that Barcelona will continue to compete in La Liga, regardless of what happens with Catalonia’s bid for independence.

First, Barcelona has significant financial interest to take advantage of the lucrative TV revenue distribution model that exists in Spain. Clubs in Spain negotiate TV rights independent of each other, unlike most other major soccer leagues where clubs negotiate as a block.[8]  Consequently, the larger, more popular teams in Spain secure vastly more profitable deals than the smaller teams. For example, in 2014-2015, Barcelona received around $173 million and the last place finisher in La Liga received only $15 million. [9]

To put those numbers in context, the English Premier League secured Europe’s largest TV distribution rights deal, worth more than five billion pounds, and the last place club in England’s top division now receives over 100 million pounds. [10] Thanks to the huge influx of revenue league wide in England, traditionally smaller clubs are now spending more than ever before.

The Spanish league has adopted a new revenue sharing model based on the English Premier League. [11] 93% of the total funds will, in theory, be spread among all the clubs based on a simple formula.[12] 50% of the total revenue is shared equally among all clubs, 25% is allocated based on final league table position, and the final 25% is based on resource generation ability of the clubs.[13] The remaining 7% not associated with the revenue sharing deal will be used on things like administrative costs and the La Liga Women’s league. [14]

The most important caveat of the new rule is that teams are not allowed to make less than they currently make within the existing agreement. [15] Therefore, even though smaller clubs in Spain will see a significant increase in spending power, Barcelona and Real Madrid will continue to maintain a massive share of the TV revenue.

From a competitive standpoint, Barcelona’s historic success is, at least in part, because of the extreme revenue disparity from the TV distribution rights and the corresponding difference in spending power. It is almost impossible to foresee a situation where Barcelona would choose to leave a league they have dominated not just athletically, but also financially.

It is also important to recognize Barcelona’s importance to both La Liga and Spanish soccer as a whole. It would be a disaster for La Liga to lose access to the global presence of the club. Barcelona has the largest revenue stream of any club, the largest stadium, the most following on social media, and arguably the greatest player of all time.[16] It would be devastating for La Liga to sacrifice the excitement, recognition and, most importantly, money that Barcelona generates.  

There are examples in leagues around the world where teams play in other countries domestic leagues. Swansea City and Cardiff City are two Welsh teams that have competed in the English Premier league and Monaco, both the name of the team and the principality where they reside, compete the in the French league.

In short, there are significant financial interests for both Barcelona and La Liga to ensure Barcelona and Lionel Messi remain in La Liga, no matter what happens with Catalonia’s bid for independence.

 

*Staff Writer, Villanova University Sports Law Society Blog; J.D. Candidate, May 2020, Villanova University School of Law

[1] Raphael Minder & Ellen Barry, Catalonia’s Independence Vote Descends Into Chaos, N.Y. Times (Oct. 1,2017), https://www.nytimes.com/2017/10/01/world/europe/catalonia-independence-referendum.html.

[2] Id.

[3] Id.

[4] Nick Bailey. How Spain’s Crisis over Catalonia Independence Plays Out on the Soccer Field, NBC News (Oct. 7, 2017, 6:44 AM ET), https://www.nbcnews.com/news/world/how-spain-s-crisis-over-catalonian-independence-plays-out-soccer-n807121.

[5] Id.

[6] Id.

[7] Id.

[8]Andrew Brennan, As Riches Flow, The Premier League, Bundesliga, And La Liga Will Face A Wage Race, Forbes (June 9, 2016), https://www.forbes.com/sites/andrewbrennan/2016/06/09/as-riches-flow-the-premier-league-bundesliga-and-la-liga-will-face-a-wage-race/#3522887a7afc.

[9] Id.

[10] Id.

[11] Bobby McMahon, $1.6 B Worth of TV Deals Good News For Real Madrid, Barcelona and La Liga, Forbes (Dec. 15, 2015, 5:15 PM), https://www.forbes.com/sites/bobbymcmahon/2015/12/05/1-6b-worth-of-tv-deals-good-news-for-real-madrid-barcelona-and-la-liga/#14eb4edb166f.

[12] Id.

[13] Id.

[14] Id.

[15] Id.

[16] Golda Arthur, Catalonia’s Vote Could Shake Up One of the World’s Biggest Soccer Teams, Marketplace (Oct. 4, 2017, 7:09 PM), https://www.marketplace.org/2017/10/04/world/catalonias-independence-could-shake-soccer.