The Argentine Football Association (AFA) obtained a favorable ruling in court against the model of Sports Limited Companies (SAD) with which the government of Javier Milei intends to move forward, and ensure that clubs can incorporate private shareholders.
The Federal Court of Mercedes decided to grant the precautionary measure requested by the AFA, and ordered the National State to suspend the effects of articles 335 and 345 of DNU 70/2023, as well as the Regulation of SADs. The measure is in force until the final judgment is issued, according to the Doble Amarilla portal.
From Casa Rosada they question the proposal of the AFAwhich maintains that although the institution does not have the power to prevent a club from choosing to become a SAD, the National Constitution protects it to do so. prevent their entry as a member and from participating in tournaments that organizes.
“The organizations that are part of the Institutional System of Sport and Physical Activity that modify or have modified their legal structure by adopting some of the figures contained in article 19 bis of Law No. 20,655 and its amendments They will have the right to maintain their participation in any competition in which they participated under their previous legal structure and under the same conditions. that were in place prior to the change,” states the regulations published on Wednesday.
The decree further explains that the “legal entities incorporated as public limited companies” whose objective is “the practice, development, support, organization or representation of sport and physical activity” can be integrated into the Institutional System of Sport and Physical Activityjust as civil associations do.
SAD: what does Javier Milei’s new decree say?
The decree details the changes made and specifies what the new regulatory framework is like. In its first article it defines that the “members of civil associations” will be “those who participate in the extraordinary assembly of the association that considers the decision to transform the entity into a public limited company or resolves to be a member of public limited companies.”
On the other hand, in the second article it specifies that although the statutes or internal codes of the sports associations, federations and confederations have not yet been adapted, These may not “prevent, hinder, deprive or undermine any right of a sports organizationincluding its right to join a confederation, federation, association, league or union, based on its legal form, original or derived”, which has chosen to become a SAD.
In this regard, it clarifies that all clubs and associations “will have the right to maintain their participation in any competition in which they participated under their previous legal structure and under the same conditions as they were prior to the change.”
Finally, a period of one year from today (Wednesday, August 14, 2024) is given for the AFA and the rest of the associations, federations and confederations to adapt their rules to this measure. “The period of ONE (1) year established in article 345 of the Decree of Necessity and Urgency No. 70 of December 20, 2023 will be counted from the date of entry into force of this decree.”
In July, the General Inspection of Justicein another step forward in the intention to transform clubs into private institutions, issued a resolution that establishes a series of deregulations and flexibilization of procedures, among which are those related to SADs.
“That, in accordance with the provisions of articles 346 and 347 of Decree of Necessity and Urgency No. 70/2023 (…) The participation of civil associations and foundations as shareholders in corporations should be accepted and the transformation of civil associations into public limited companies; as well as simplifying the registration of common good entities established abroad for the development of their activity in the Argentine Republic,” the regulations established.
Until Milei’s arrival to the presidency, Law No. 20,655 allowed sports clubs to be organized mainly as civil associations. However, the Decree of Necessity and Urgency No. 70/23, published in December 2023, in the first days of the libertarian administration, modified this regulation to allow them to also become sports corporationsa political objective that met with resistance from the clubs and the entity that brings them together.
Source: Ambito
