European Union investigates Spanish clubs

The European Union has opened legal proceedings into whether Real Madrid, Barcelona and five other Spanish clubs get an unfair edge from illegal state aid.

EU Competition Commissioner Joaquin Almunia said that clubs should use sound financial management rather than live “at the expense of the taxpayer.”

Almunia’s office must make sure businesses across the 28-country EU face a level playing field. The probe is intended to see if teams like Barca and Real have been relying on illegal aid to face other Spanish clubs, and European teams like Bayern Munich in the Champions League.

Beyond the top two teams, the probe centers on Valencia, Hercules, Elche, Athletic Bilbao and Osasuna.

The Spanish government, who knew the probe was coming, has already said there was nothing illegal about the aid the clubs received.

Foreign Minister Jose Manuel Garcia-Margallo said the government would “give battle until the end to defend Spanish clubs.”

La Liga is one of the toughest professional leagues in the world and any EU decision could have a deep impact on its future.

The investigation may take several months and any decision could then be challenged at the EU’s highest court in Luxembourg.

Many Spanish league clubs already face financial difficulties. A decision to force them to return money could make their problems even more acute.

“The Commission has concerns that these measures provided significant advantages to the beneficiary clubs to the detriment of the clubs which have to operate without such support,” the Commission said in a statement.

No financial figures were immediately available but the objections the EU was looking into centre on how clubs and local authorities handled fiscal issues such as loan guarantees, land prices and real estate.

The Spanish league has said in a statement that it “wants to publicly show its unconditional and absolute support for the clubs and affiliated managing institutions in general and those under investigation in particular.”