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ITALY: European Commission asks Italy to modify the accounting rules provided for by the

On July 7, 2004 the European Commission has formally asked Italy to modify Law no. 27 of February 2003 (so-called "Football Saviour Decree") that allows sport clubs to write down the value of sportsmen's contracts over a longer period of time than their useful economic life. The European Commission has issued a reasoned opinion, that is the second stage of the infringement procedures provided for by Article 226 of the EC Treaty. If Italy does not comply with the reasoned opinion within two months, the Commission may bring the matter before the Court of Justice. In particular, the European Commission believes that Football Saviour Decree: i) breaches EC Accounting Directives (78/660/EEC and 83/349/EEC) that require sportsmen's contracts to be written down over their useful economic life, which generally would be the term of validity of those contracts and; ii) is not in compliance with the principles of true and fair view and of prudence. The effect of the Football Saviour Decree is that sport clubs may have a balance sheet which underestimates the true costs in a given year and therefore hide real losses, showing to investors and creditors a misleading financial position. On the tax treatment of the write down provided for by the Football Saviour Decree, which was held by the European Commission to constitute a State Aid, the Italian Government and the Commission reached an agreement on March (see our website news of December 15, 2003 and its March updating).
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TheĀ Editors

The editors of  the Journal Sports Law & Taxation are Professor Ian Blackshaw and Dr Rijkele Betten, with specialist contributions from the world's leading practitioners and academics in the sports law and taxation fields.

The Editors

Managing editor
Dr. Rijkele Betten

Consulting editor
Prof. Dr. Ian S. Blackshaw

Editorial board

Prof. Guglielmo Maisto
Maisto e Associati, Milano

Dr. Dick Molenaar
All Arts Tax Advisors, Rotterdam

 

Mr. Kevin Offer
Hardwick & Morris LLP, London

Mr. Mario Tenore
Maisto e Associati, Milano

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