Barcelona ordered to pay 4.5 crore rupees fine for ‘wilfully and consciously’ misreporting income

The case stems from the way Barcelona handled its financial reporting of a deal it secured to sell off a percentage of its broadcast rights for the next 25 years.

Representative Image: UEFA said Barcelona “wilfully and consciously” submitted wrong information and that the club’s behaviour had to be “condemned in the clearest terms.” | Photo Credit: REUTERS

Barcelona will have to pay a fine of 500,000 euros (USD 542,000, INR 4.5 crore) after losing another appeal against a ruling by the Union of European Football Associations (UEFA), which accused the Spanish club of “wilfully and consciously” misreporting income in a bid to comply with European football’s financial rules.

The Court of Arbitration for Sport in Lausanne dismissed Barcelona’s appeal and, in a highly critical ruling published Friday, said the sanction of 500,000 euros was “actually rather mild.”

The case stems from the way Barcelona handled its financial reporting of a deal it secured to sell off a percentage of its broadcast rights for the next 25 years, which UEFA said was “manifestly inaccurate and non-compliant” with its rules aimed at ensuring responsible spending among football clubs in Europe.

In total, Barcelona secured deals worth 667.5 million euros (USD 724 million) in 2022 for selling off 25% of its future broadcast earnings from the Spanish league for the next 25 years.

UEFA said it then deliberately misreported one of those deals in its financial accounts and “overstated” its break-even results by 267 million euros (USD 290 million).

UEFA said Barcelona “wilfully and consciously” submitted wrong information and that the club’s behaviour had to be “condemned in the clearest terms.” European football’s governing body has rules intended to ensure the financial stability of clubs. Those rules only allow clubs to make certain losses over three years.

The sale of “non-tangible assets” such as future broadcast earnings are not allowed to be included in those break-even calculations and Barcelona was fined 500,000 euros last year for reporting profits which were not relevant.

After losing an appeal at UEFA, Barcelona appealed to CAS and also argued that the size of the fine was disproportionate.

However, CAS upheld the sanction because a smaller fine would “likely not be a sufficiently strong deterrent to prevent a major club like FC Barcelona from intentionally misreporting income with a major impact on its break-even results.” Barcelona has faced financial turmoil in recent years and reluctantly had to allow club great Lionel Messi to leave the club in 2021