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NUFC and the Saudis

Foreign governments should not own football clubs

This article is taken from the November 2023 issue of The Critic. To get the full magazine why not subscribe? Right now we’re offering five issues for just £10.

On 4 October, as Champions League football returned to St James’s Park, there was a strange subtext to the fixture. For the visitors were Paris St Germain. At a press conference preceding the game, journalists asked if the identity of Newcastle United’s opponents brought an extra edge to what was already a big occasion.

This “edge” was not about Anglo-French rivalry, even though it was in the north-east of England during the Napoleonic Wars that, according to legend, residents hanged a shipwrecked monkey, believing him to be a spy. Nor was it about any history of bad blood between the two teams. No, it was about the identity of the clubs’ owners. Newcastle, owned by Saudi Arabia, were playing PSG, owned by Qatar. 

Some therefore asked whether the game might take on some kind of geopolitical significance. It was not an unreasonable question. The two countries have restored their diplomatic ties now — with Mohammed Bin Salman even donning a Qatar football scarf during the world cup held there last year — but before that the relationship had been toxic. Between 2017 and 2021 the Saudis, along with the United Arab Emirates, Bahrain and Egypt, effectively blockaded Qatar.

The fact that these complex and controversial issues might be in any way relevant to a football match played on a wet October Newcastle night is strange enough, but it is not really the biggest problem with the situation. For it is wrong — as both a matter of principle and of footballing fairness — for nation states to own football clubs.

First off, we should deal with the canard that Saudi Arabia does not really own Newcastle. The takeover, by Saudi Arabia’s Public Investment Fund, originally collapsed in 2020 because PIF would not give assurances that the club would not be controlled by the Saudi state. In 2021, the deal eventually went ahead when the Premier League said it had been given “legally binding assurances that essentially the state [of Saudi Arabia] will not be in charge of the club” and if there arises any “evidence to the contrary, we can remove the consortium as owners”. 

And yet there is evidence to the contrary. In a court case in America earlier this year, which related to the battle between PGA Tour and LIV Golf, the claim that PIF is not an instrument of the Saudi state was blown out of the water. LIV Golf is a Saudi-financed tour that PGA considered an unacceptable challenge to global golf governance, although the dispute ended peaceably when the two parties agreed a merger. 

In the court case, however, a federal judge ordered PIF to submit documents and ruled that its governor, Yasir Al-Rumayyan, who is Newcastle’s chairman, should be cross-examined. In response, PIF claimed sovereign immunity, saying “the order is an extraordinary infringement on the sovereignty of a foreign state … The PIF and His Excellency Yasir Othman Al-Rumayyan are not ordinary parties … they are a sovereign instrumentality of the Kingdom of Saudi Arabia and a sitting minister of the Saudi government.”

This is a problem for several obvious reasons. The sudden Saudi, and Qatari, investment in globally popular sports is said by human rights campaigners to amount to “sports -washing”. Just as the former Chelsea owner Roman Abramovich escaped scrutiny and censure for his actions — until he was sanctioned following Russia’s invasion of Ukraine — so, goes the argument, the Saudi government wants to clean its reputation by making itself the generous benefactor of sport. Certainly, those Geordie supporters who gleefully turned up to matches dressed in robes and kaffiyehs, seemed happy to oblige.

From a sporting perspective other problems arise. Most obvious is the sheer scale of the budgets available to clubs owned by governments. Manchester City — owned by the Abu Dhabi United Group, led by Sheikh Mansour, the deputy prime minister of Dubai — has spent a reported £2 billion on new players in the fifteen years since Mansour bought the club. PSG — in the decade since Qatari Sports Investments bought them — have spent an estimated €1.4 billion, including €222 million on just one player, Neymar, alone. In the first year under PIF, Newcastle spent £221 million.

And of course clear conflicts of interest arise

And of course clear conflicts of interest arise. In Europe, UEFA has Financial Fair Play rules that allow clubs to incur losses of €60 million over three years, and impose a spending cap on wages, transfers and agents’ fees to 70 per cent of total club revenue. This is at once a protective measure that pulls the ladder up from beneath the likes of City, and ripe for abuse too. 

For example, Chelsea sign players on suspiciously long contracts, allowing them to use amortisation to get around the rules. Now the concern is that Middle Eastern clubs will buy players from partner clubs in Europe at inflated prices to help avoid the rules. Premier League clubs worried this happened with the sale of Allan Saint-Maximin from Newcastle to Al-Ahli — both owned by PIF — this summer.

There is clearly no problem in principle with the foreign ownership of football clubs. And the argument that we allow Saudi and Qatari investment in other sectors of the economy — and indeed send British products in the opposite direction — is not really relevant. For good sporting reasons, foreign governments should not own football clubs.

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