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Soccer clubs face penalties over finances

Association threatens to pull licenses from clubs that don't meet obligations

Financial troubles have plagued the Czech Football Association including the club Slavia Praha. In response, the association is considering revoking licenses of four clubs.
By Frantisek Bouc
 Staff Writer, The Prague Post
Jan. 27, 2005


The threat of bankruptcy hangs over several major soccer clubs this season, and for the first time in the history of the sport here, financial problems off the field could lead to disqualification from the field. The mounting financial debts of four clubs from the first and second divisions have prompted the Czech Football Association (CMFS), to issue an unprecedented warning. On Jan. 19, the regulatory body said that should the two clubs from the Gambrinus liga, Blsany and Opava, and the Druha liga's, or second division's Bohemians and Hradec Kralove, fail to clear up their debts by mid-February, the CMFS would yank their professional licenses. Such a move would demote the clubs to the amateur leagues.

The warning was not meant to put another burden on the debt-ridden clubs, said Stanislav Ryznar, chairman of the CMFS license committee. "We certainly don't want to go against the clubs, but we want to pursue financial stability in the professional leagues," Ryznar said.

The country has 32 professional football clubs in two leagues: the Gambrinus liga and the second division. The annual budgets of clubs competing in the top-flight Gambrinus liga range from 40 million Kc to 200 million Kc ($1.74 million-8.7 million).

While there are more Czech clubs struggling with their bottom lines, including Slavia Praha, the CMFS managers are concerned with these four clubs because of the massive amounts of red ink they're generating. Opava's debts total 65 million Kc, and the Prague-based Bohemians are trying to juggle a 40 million Kc debt. Blsany is 10 million Kc in debt. Management at Hradec Kralove declined to release exact financial information, but players from all four clubs say they've been owed back wages for months.
"We certainly don't want to go against the clubs, but we want to pursue financial stability."

Stanislav Ryznar,
CMFS licensing committee

In December, the CMFS sanctioned the Bohemians for being unwilling to pay at least part of its debt with the deduction of three points from their second-division record. The Bohemians' former owner, Jiri Krizek, said the club was doing what it could to meet its current commitments and was unable to pay past debts.

The delay in receiving their pay packets has prompted some players to consider hitting the picket line in protest. In November, Slavia Praha's players declared they were ready to terminate their contracts with the club if it did not pay back wages and bonuses. Slavia was finally able to clear its debts thanks to support from English National Investment Company, or ENIC, which forgave 360 million Kc in debt. ENIC is the main shareholder in Slavia Praha, but the company declined to reveal its specific financial dealings with the football club.

While Slavia Praha's players were finally given some cash to kick around, players at other clubs have been less fortunate. Players in Opava and Blsany threatened to strike in early January. The Opava team even rejected a friendly match in protest to management's inability to pay up.

"There is big chaos within the club and players do not know what to do," said team captain Jan Baranek.
RED CARD

Four of the country's football clubs are facing mounting debts and anger from players who say they're owed back wages and bonuses. The clubs and their debts:

Gambrinus liga

• Opava: The club's debts total

65 million Kc ($2.8 million). Players are threatening to strike unless they receive their wages

• Blsany: The club owes players some 10 million Kc. Players are considering striking or jumping to another club if they're not paid

Druha liga

• Bohemians: The club has debts of more than 40 million Kc
• Hradec Kralove: The club hasn't paid players since October

Should the four clubs be stripped of their licenses, the two leagues could be reduced to 14 clubs each. "It's possible that this will need to happen," said Gambrinus liga director Ivo Lubas.

Bad taste

Football clubs ran into financial trouble after a corruption scandal in the spring of 2004. Police wiretaps revealed an agreement between Gambrinus liga club officials and referees to fix games. Police have filed charges of corruption against 25 league officials, and the investigation is continuing.

The affair left a bad taste in the mouth of sponsors, many of whom were prompted to re-examine their commitment to Czech football. While no firm numbers are available on how much money the scandal has cost the sport, club managers have felt sufficiently impacted to call for a conclusion of the ongoing police investigation.

"Disciplinary proceedings with clubs and individuals are harming us and should be brought to an end soon," said FK Jablonec director Jaroslav Kaspar. "They only cause chaos among the sponsors and this could further harm football."

Pilsner Urquell is the main sponsor of the Gambrinus liga. A spokesman for the brewery said that while there is concern among the company's management about the corruption affair, the company would continue its annual 50 million Kc support for football. "However, our sponsorship represents only a minor part of the league's budget," said brewery spokesman Alexej Bechtin. "But it's true that the current turmoil could dissuade new sponsors."

Ryznar, chairman of the CMFS license committee, said barring the indebted clubs from the professional league was a measure of last resort. The final decision would most likely have to come before the Gambrinus liga resumes play Feb. 26.

"We still hope that the clubs can sort out their difficulties," Ryznar said. "That's why we gave them another month to deal with the issue."

Frantisek Bouc can be reached at fbouc@praguepost.com




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