Relations between France and Spain have been pretty good ever since they cleared up that misunderstanding over Napoleon Bonaparte crossing the Pyrenees, capturing Barcelona and replacing the Spanish king with his brother Joseph Bonaparte. That sparked five years of war but it was 200 years ago and bygones appeared to be bygones.
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Until last week, that is, when Kylian Mbappe, a footballer from Paris, decided to turn down an offer from Real Madrid, choosing instead to remain with Paris Saint-German. The 23-year-old striker has been very apologetic about upsetting those who had hoped to see him play in Spain but he explained he’s a French lad at heart and would like to help his hometown club achieve their dream of winning the Champions League, a trophy Real Madrid won for the 14th time in Paris on Saturday.
Fair enough, right?
Wrong, very wrong, according to La Liga president Javier Tebas, a 59-year-old lawyer who could start a fight in a monastery. He called Mbappe’s decision “an insult to football” and PSG’s behaviour “scandalous”. He is also threatening to make formal complaints to the European Union, the French “administrative and fiscal authorities” and European football’s governing body UEFA.
A few days later, his opposite number at the Ligue de Football Professionnel (LFP), Vincent Labrune, poked back with two Exocet missives of his own: one sent to Tebas telling him to do one, and the other to UEFA president Aleksander Ceferin telling him to have a word.
Now, there will be some of you who feel the same way about this row as former US secretary of state Henry Kissinger felt about the Iran-Iraq War — “it’s a pity both sides can’t lose” — but football is not like that. Someone wins on penalties.
Let us, then, analyse the claims and counter-claims so we can proclaim who is less awful than the other in this hilarious, sorry, serious dispute.
Tebas: PSG cannot afford Mbappe
The ink was not even dry on the French star’s new contract at PSG when La Liga released a statement that reads like a dozen of Tebas’ infamously barbed tweets stitched together.
“La Liga wishes to state that this type of agreement attacks the economic stability of European football, putting at risk hundreds of thousands of jobs and the integrity of the sport, not only in European competitions, but also in domestic leagues.”
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Hundreds of thousands of jobs? Ooh la la.
“It is scandalous that a club like PSG, which last season reported losses of more than €220 million, after accumulating losses of more than €700 million in prior seasons (while reporting sponsorship income at doubtful valuation), with a squad cost around €650 million for this season, can close such an agreement, while those clubs that could afford the hiring of the player, without seeing their wage bill compromised, are left without being able to sign him.”
There is a lot going on in that sentence.
First, it is true that PSG posted a loss for the 2020-21 season of €225 million, which followed a loss of €125 million a year before. So, a cool €350 million (almost £300 million) gone over two years.
It is also true that what Tebas calls PSG’s “squad cost” — all spending, including transfers, on the first team’s players, coaches and support staff, as well as money spent on the reserves and academy — comes to about €650 million. PSG’s total wage bill of €503 million is the highest in Europe, €102 million higher than Manchester City and €131 million more than Real Madrid.
But the figure for accumulated losses of more than €700 million is harder to get to, certainly since PSG was bought by Qatar Sports Investments, a subsidiary of the Gulf state’s sovereign wealth fund, in 2011. In fact, between 2015 and 2019 they made profits in four of five seasons, with a cumulative profit for the five-year period of €76 million.
Now, it is true PSG’s revenues have been transformed under Qatari ownership — their revenue of €570 million in 2021 was five and a half times greater than in 2011 — and Qatari sponsors have played a controversial role in that success story. We shall return to that but, for the time being, it should be pointed out that the club’s biggest individual sponsors are now an American sportswear brand and a French hotel chain.
But more relevantly for Tebas’ argument, it would appear PSG are not in danger of breaching UEFA’s Financial Fair Play rules. Under the current regulations, which are in place until next year when they are replaced with something more proactive but less onerous, clubs are allowed to lose up to €30 million over a three-year period.
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However, clubs can subtract various costs from their FFP calculation, such as money spent on youth development, infrastructure and the women’s team. PSG have a handball and a judo team, too. They can also knock off any losses directly caused by COVID-19, which in PSG’s case are in the region of €150 million, and treat the two pandemic-affected seasons as one 24-month accounting period, averaging out the losses over the two seasons.
If €150 million (£127 million) sounds like a remarkable sum for a club that does not always sell out its 48,000-seat stadium, you must remember Ligue 1 was the only one of Europe’s Big Five leagues to curtail the 2019-20 season, which cost its clubs €400 million in lost broadcast revenue. That blow was compounded the following season when the league’s new broadcast partner, Mediapro, ripped up its €1.15 billion contract three months into the campaign.
That meant going cap in hand back to the league’s jilted partner, Canal+. The result was another €400 million-plus hit on projected revenues. The league has another new partner now in Amazon but the numbers are nowhere near the riches promised by Mediapro.
The upshot of this is PSG can wipe off €150 million from that €350 million loss over two years, split that evenly across 2020 and 2021, and then make all the usual deductions. The Athletic estimates the French champions will comfortably satisfy UEFA’s spending limits for the last two seasons.
That said, those 2021 figures did not include all of the last summer’s arrivals — Gianluigi Donnarumma, Achraf Hakimi, Lionel Messi, Sergio Ramos and Georginio Wijnaldum — so, despite the return of fans and PSG’s commercial feats, the 2022 accounts are expected to reveal another €100 million-plus loss.
PSG president Nasser Al-Khelaifi is confident the club has got its sums right but it is no coincidence that the club has said goodbye to Angel Di Maria in the same week it re-signed Mbappe. The Argentine winger will not be the only high-earner to leave the Parcs des Princes this summer.
So, whether Mbappe is on €40 million a year or €50 million — opinions vary — PSG know their Qatari owners are good for it and the striker’s reported €150 million signing-on fee can be amortised, or spread, across the three years of his contract, like a transfer fee. This should mean any losses between now and 2025 are small enough to stay on the right side of UEFA.
Verdict: wrong. It might not sound like financial fair play but Qatar-backed PSG can afford to make Mbappe the best-paid footballer in the world (while also employing Messi and Neymar, almost certainly second and third on that list).
Tebas: Real Madrid can afford him
Real Madrid, we have learned, offered him pretty much the same terms. And having effectively saved up for him over the last few seasons by selling young squad players or releasing ageing stars, they were in no doubt they could afford him.
After all, they earned £50 million more than PSG last season, actually made a profit of about £1 million across 2019-21 and can look forward to games back at their expanded and renovated Santiago Bernabeu home next season.
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They are also European and Spanish champions again.
Verdict: correct. They’re big, rich and successful — they’ve got the readies.
Labrune: What a hypocrite, two of your clubs are football’s fattest cats
In his letter to Tebas, the LFP chairman expresses his disapproval of the Spaniard’s attacks “in the strongest possible terms” and points out how inappropriate they are, given the fact Tebas is president of European Leagues, the body that represents the interests of the domestic leagues, a position which gives Tebas a seat on UEFA’s executive committee.
He then addresses the “factual substance” of Tebas’ letter/statement/tweets, which he notes is “difficult to follow”.
“Your attacks on Ligue 1, Paris Saint-Germain and Kylian Mbappe are based around your own interpretation of financial unsustainability and competitive imbalance, which you repeatedly attribute to Ligue 1 and one of our clubs.” writes Labrune.
He then points out that Barcelona, the financial basket case in the room, and Real Madrid have broken the world transfer record six times in the last decade. Real, he notes, also had two of the game’s highest-earners, Gareth Bale and Eden Hazard, warming the bench against Liverpool, while Barcelona have debts of more than €1.5 billion. The Catalan giants, for what it is worth, lost €555 million last year but are unlikely to be shopping in the Mbappe aisle for several years, so Labrune perhaps felt he did not need to make this point.
He did, however, land a sneaky blow by reminding Tebas of last year’s European Court of Justice ruling that Barcelona, Real Madrid, Athletic Bilbao and Osasuna all benefited from illegal state aid for more than 20 years. This is to do with the Spanish authorities treating these member-run clubs as non-profit organisations, giving them a tax advantage over their rivals.
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The repayments have been capped at €5 million, not a bank-breaking sum, but Real Madrid are particularly sensitive to accusations of state aid given the earlier controversy over the land deal they did in 1998. That is when they sold their old training ground to Madrid city council in return for cash and land elsewhere in the city, some of which they used to build a new training ground and some they sold. Newly-elected club president Florentino Perez used the proceeds for Real’s first wave of “Galacticos”, Luis Figo and Zinedine Zidane.
It later turned out the city did not own all of the land they had given to the club — an inexplicable mistake, but never mind — so they took it back, compensating Real with different parcels of land, some of which they swapped with the city for land around the Bernabeu, enabling the club to start the renovations they have just finished. All above board, apparently, but there are some mischief-makers who like to suggest Real Madrid were the first big, state-backed European club, not PSG or Manchester City. Real Madrid deny this.
Verdict: he’s got a point.
Tebas: PSG’s “impossible investment” threatens the integrity of football, in Europe and France
The Spaniard has not offered any evidence to support this claim but Labrune’s letter provides plenty of points that would appear to contradict the idea that PSG are a dominant force in Europe. After all, the Parisians have won precisely two European titles: the 1996 European Cup Winners’ Cup and the 2001 Intertoto Cup.
“In relation to competitive balance, your position lacks any coherence or self-awareness,” the 51-year-old Frenchman writes.
“In recent years, Barcelona and Real Madrid won seven out of nine Champions League finals in a row (The Athletic: not quite, they won seven in 10 years between 2009 and 2018). In 18 years, only three clubs have won your league, with 16 of those years by two clubs (Barca and Real). In that time, seven different Ligue 1 clubs have won our league, while in Germany, one team (Bayern Munich) have won the league 10 years in a row. Yet your focus and attacks remain constant on our league.”
Yes, these are good points but we cannot help thinking Labrune is not telling the full story.
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For example, before they were bought by Qatar, PSG had won two French titles. But since 2011, they have won eight of 10 championships, finishing second in the years they missed out. They have also won five French cups and six French league cups before that latter competition was cancelled in 2020. They won this year’s league title by 15 points, which is hardly surprising when you remember their wage bill is about four times as big as the next highest spender in France, Lyon.
Labrune does, however, score with his next point.
“It is also not lost on anyone that the pinnacle of competitive imbalance was the recent breakaway European Super League — founded and still maintained by your two clubs.”
He does not need to name them. We all know who they are.
Verdict: neither league has a great story to tell about competitive balance but it’s a bit rich of Tebas to moan about PSG threatening the integrity of European football when both Barca and Real, two free-spending ESL rebels who have benefited from state support, have won a combined 37 European titles to PSG’s two.
Tebas: PSG have previous
“In the past, La Liga has complained to UEFA for non-compliance with financial fair play by PSG,” La Liga’s statement notes. “These complaints were successful and UEFA sanctioned the club, while the Court of Arbitration for Sport (CAS), in a bizarre decision, reversed the sanctions.”
OK, there are two parts to this two-footed challenge, let’s call them the right foot and the left foot.
The right foot relates to the five-year, €1 billion sponsorship deal PSG agreed with the Qatar Tourism Authority (QTA) in 2012, which included a retroactive payment for the 2011-12 season. This windfall wiped out the club’s huge losses in the first couple of years under Qatari ownership.
UEFA, however, prompted by La Liga et al, ruled that this deal was way over market value and halved its value for FFP purposes in early 2014. This meant the French side breached the rules that season and they were fined €60 million, with further restrictions imposed on their ability to spend. Manchester City received a similar sanction for a similar offence at the same time.
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The left foot relates to what happened in August 2017, when PSG poached Neymar from Barcelona by activating the €222 million release clause in the Brazilian’s contract and doubled down a month later by signing a then 18-year-old Mbappe from Monaco, initially on a season-long loan but with a €180 million option to buy, which they stretched over three seasons.
This magic trick had everyone in European football scratching their heads as to how they had done it, and UEFA immediately opened an investigation. Tebas responded to the news of this inquiry by saying “we’ve caught them peeing in the swimming pool”.
Great line but a bit hasty.
In June 2018, UEFA’s FFP watchdogs cleared PSG of breaching the rules but again revised the club’s three big Qatar sponsorships — the QTA, the Qatar National Bank and Qatari telecoms firm Ooredoo — downwards and told PSG it was time to move on from the QTA relationship. The governing body also leaned on the club to raise money by selling some players, which they did.
But three months later, in September, UEFA announced it was reopening the investigation. Had someone been in their ear?
PSG promptly appealed to CAS, which ordered UEFA to suspend its renewed look under PSG’s bonnet. And then in March 2019, sport’s highest court delivered its “bizarre decision”, telling UEFA its June 2018 decision was final. Within the year, PSG had achieved those player-sale targets and swapped QTA for Accor, the aforementioned hotel chain, on the front of their shirts. As you were.
Verdict: he’s not wrong… but he’s not entirely right, either.
Labrune: Tebas is smearing the reputations of players because they have chosen to play in France
“When Lionel Messi, Sergio Ramos and others left your league — by choice — last year, rather than acknowledge their greatness, which you had weeks prior to their departure, you commented on their age and said our league is ‘like a league of legends given the age of some players’,” writes Labrune.
“Now your disrespectful smears seem to be directed towards Kylian Mbappe, who is widely acknowledged to be one of the world’s greatest players and who simply didn’t join your league.”
To be fair to Tebas, he has been careful not to criticise Mbappe personally — he has left that to Real’s cheerleaders in the Spanish media — just as Mbappe himself has been masterfully diplomatic in his apologies to Real Madrid for not joining them. Yet.
But the La Liga supremo has left himself open to accusations of being “#obsessed” with PSG’s recruitment of players once based in Spain and this has presented something of an open goal to his French-based critics.
Speaking at a triumphal press conference to unveil their nearly-new signing last week, PSG president Nasser Al-Khelaifi said: “What the president of the Spanish league says does not interest me. He may be afraid that Ligue 1 is better than La Liga. The Spanish league is no longer what it once was.”
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Given Real’s victory over Liverpool this weekend, this may seem a strange time to suggest the Qatari might be on to something.
Clearly, he is wrong about Ligue 1 being better than La Liga — the Spanish league still beats its French equivalent on every financial, performance and popularity metric The Athletic can think of — but he is right that La Liga is not “what it once was”. For example, it is no longer the natural home of the world’s biggest stars and it has lost its lead in UEFA’s country rankings to the Premier League.
Some of this is simply to do with the cyclical nature of sport (Spain won three straight international titles between 2008 and 2012, two Euros and a World Cup, but have dipped since then), some of this is because the Premier League weathered the pandemic better than every other league. And thanks to the cavernous pockets of their owners, PSG coped pretty well, too.
Because that is where Labrune’s argument starts to fall down. Ligue 1 is not regularly poaching La Liga’s biggest names; PSG are. Messi, Neymar and Ramos were only ever going to Paris, not Lille, Lyon or Marseille.
Verdict: nobody wins this bout of name-calling.
That is probably as good a place as any to end this exercise.
A brilliant young footballer has changed his mind about moving from one very rich club to another. He has done so because the club he has been playing for is his hometown team and they have given him everything he and his family asked for in terms of remuneration and respect. Mbappe is PSG’s most important employee, with the biggest voice.
This is obviously a disappointment for Real Madrid, as they could not have made their interest in the player much clearer, but they have lots of other brilliant footballers on their books and they will attract plenty more in the future. Even Real cannot win them all.
Does Tebas make good points about state-backed teams and the dangers of unfettered spending? Si.
Should he perhaps get his own house in order first? Oui.
Is Labrune the best-placed person to point this out? Non.
And around and around we go. Someone will miss a penalty in this shootout eventually, they always do, but the rest of us will almost certainly have switched off by then.
(Top photo: Aurelien Meunier – PSG/PSG via Getty Images)
