Battle over Argentina's distinctive football model

Argentina is a country where football is often a greater part of public life than religion, is one of the sport’s most successful nations. While its non-profit system is an oddity in world football, supporters argue it is essential to preserving the social role of clubs, which run community centres and even schools in many towns — services that for-profit companies may be tempted to cut.

But critics complain the model has stunted teams’ development, making even big clubs such as Boca Juniors and River Plate regular exporters of their brightest talents. Lionel Messi, one of the sport’s greatest ever players, left for Spanish club Barcelona aged 13 years old. Brazil, which approved a law encouraging clubs to become limited companies in 2021, has recently attracted a wave of investment, with several top division clubs now foreign owned.

Estudiantes, a fast-rising team in Argentina’s top league, is preparing to hold a vote by some of its 56,000 members next month on whether to form a joint partnership with US businessman Foster Gillett, son of Liverpool FC’s former owner, in exchange for a $150mn investment. That would make the team from La Plata, a city 55km south-east of the capital Buenos Aires, unique among Argentine football clubs, which are owned by their members and bar investors from taking a formal ownership stake, deterring foreign capital.

The government views Estudiantes as a “test case” for overhauling the system, said Guillermo Tofoni, a businessman who has worked closely with the government on its privatisation scheme and brought Gillett to Estudiantes.

 “We want to grow and Argentina’s football system is exhausted,” Estudiantes president Juan Verón, a former player for the club who also had stints at Manchester United, Chelsea and Inter Milan, told La Nación newspaper this month. He argued the income offered by television rights, sponsorships and player sales is too little to reinvest. “We’re ready to do what is necessary so Estudiantes can keep getting bigger.”

The government is closing watching Estudiantes’ plan after setbacks in its efforts to reform football. Milei, who played in youth teams before training as an economist, issued an executive order days after taking office in late 2023 that gives sports clubs the option to become for-profit private groups.

A federal court temporarily swiftly suspended that order after Argentina’s Football Association (AFA) argued Milei could not force the governing body to accept private ownership. “No matter how much they try to convince us, this isn’t our model of football,” AFA president Claudio Tapia, who has ties to the left-leaning Peronist opposition movement, said last August.

 Right wing governments’ attempts to allow for-profit clubs failed in the 1990s and 2010s. “We will defend what we have been defending for many years . . . and the result will be the same.” At Estudiantes, Verón has proposed a midway option: the club, which owns players’ contracts and runs community facilities, will remain a non-profit civil association that can compete under AFA’s rules, while a new entity, co-owned by Gillett and the club, will manage professional football operations. The legal form of that entity is still under negotiation, said Estudiantes, stressing they wanted to create a “new model” rather than privatise the team.

Several surveys suggest a majority of Argentine football fans are against for-profit clubs. Yet many Estudiantes supporters, keen for success, were bullish about Verón’s plan as they attended their first game of the season last weekend. They won 3-1.

But some fans said they were concerned the club had not published details of the deal, such as where the proceeds of player sales will go. “There is a fear that if something goes wrong, we get screwed, like they did in Liverpool,” Lautaro, a 22-year-old fan told the Financial Times, referring to Gillett’s father George’s turbulent time as Liverpool owner from 2007 to 2010, when Foster Gillett served as director. Foster Gillett unsuccessfully tried to buy a majority stake in French club Lyon in 2022.

The government is appealing the suspension of its order at the Supreme Court, Vítolo added. Ezequiel Fernández Moores, a sports journalist, told the Pink ‘Un he expected Milei to treat Estudiantes’ fan vote late next month or early March as a big political moment. “Football is everything in Argentina,” he said. “If Milei can say ‘I’ve changed football’, then he’ll feel he’s proven to society that he was right about private capital and deregulation being our saviour.”