Liga MX owners pull plug on Sharks, and more

There were some fireworks as well as some nuts-and-bolts administrative decisions at the annual owners meeting.

Liga MX fans must suffer an extra week between semifinals and finals – a la Super Bowl Week – but there’ll be plenty of time to promote the América-Monterrey match-up after the Rayados return from their Club World Cup engagement.

In the meantime, it’s worth taking a closer look at what went down at the Liga MX Owners Meeting last week. A team was expelled, a petition to reduce the number of foreign players was acted upon and the Gallos Blancos franchise was sold. Some monumental stuff. And that’s not to mention the discussions about fiscal fair play.

Here, we’ll address the plight of the Veracruz franchise and the fiscal transparency matters and save the other items for tomorrow.

Tiburones owner takes aim at Liga MX confreres

The dismissal of the Veracruz Tiburones from all levels of Liga MX was the big story of the annual owners meeting. Owner Fidel Kuri has been a target of criticism and ridicule the past two months or more after his failure to pay wages became public. Further reporting revealed he was not covering administrative costs, nor paying team employees or club expenses. One story said the Liga MX Femenil team did not even have a first-aid kit and was paying its own way on road trips.

Kuri was kept out of the building where the owners meeting was being held on Dec. 3 by armed guards who informed him that only owners who were in good standing with the league were permitted access. He sought permission to allow his son to enter in his stead, but this request was denied, too. After this, he went on ESPN to rant and rave, claiming the real criminals were the ones inside that building.

Inside, the other Liga MX owners determined his fate and formally kicked Veracruz out of the league. Among other things, the Veracruz owner had been taking advantage of the league tradition to look the other way if an owner relied on twin contracts to avoid hefty taxes. This practice involves having the player sign two contracts: one submitted to the league office and the other submitted to tax officials. In addition to tax avoidance, this practice often allowed teams to pay players less than they were owed.

Kuri had been a problem practically ever since purchasing the Tiburones in 2013; he had been fined and suspended on multiple occasions, once for punching a league official in the stands after a game. But his insolvency was becoming an embarrassment, the story of players not having been paid in six months making global headlines. Plus, Kuri’s actions were drawing unwanted attention from federal fiscal authorities and that worried other league owners.

Dismissal of Tiburones forces scheduling tweaks

In late October, after much hemming and hawing – and mock consternation – the Liga MX stepped in and helped arrange some backpay, while promising to take action against Kuri and the practice of twin contracts. As the expulsion of Veracruz became inevitable, Kuri threatened to expose the inner workings (presumably illegal) of Liga MX franchises. But since the Dec. 3 banishment of the Tiburones, Kuri has not been heard from.

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The Veracruz franchise was said to be worth $39 million dollars (source: Forbes magazine) with a payroll of roughly $14 million dollars (which he had not been paying).

The Tiburones are the 16th franchise to be kicked out of a professional Mexican soccer league since 1956. The Jaguares of Chiapas were the last Liga MX team to be disaffiliated. That came just over two years ago.

The immediate result of the disbarment is that all Veracruz players automatically became free agents. Since the Tiburones only recently ended an historic 41-game winless streak, not to many of their players are on other teams’ wish lists. But goalie Sebastián Jurado, 22, and striker Daniel Villalva should field some nice offers.

The dismissal also directly impacts the Clausura 2020 season. The fast-approaching season will feature just 18 teams, down from the 19 clubs that took part in the Apertura 2019. The Clausura will be comprised of a 17-week schedule without byes and there will be no relegation following the season.

In addition, the Apertura 2019 results involving Veracruz will be subtracted from the other 18 clubs for the purposes of calculating the relegation table and other annual statistics.

As part of the promise to crack down on twin contracts, Liga MX bylaws were amended to create a centralized data system tracking all transactions. This includes wages, bonuses, transfers (both incoming and outgoing), as well as stricter debt limitations. The system will be overseen by the UIF, an anti-corruption unit within the Finance Secretariat whose main focus is money-laundering. The goal is to make all Liga MX financial activity more transparent, eliminate fraudulent activity and adhere fully to tax law.

Tomorrow, we’ll take a look at the new rule governing foreign players in Liga MX and the ownership change in Querétaro.