The publication last week of the Olympic Stadium agreement between West Ham United and stadium owners E20 Stadium LLP has prompted many West Ham supporters to ask what is next and particularly whether West Ham could be liable for multi-million pound fines for illegal state aid from the European Comission.
The concern has been, that the good deal stuck by West Ham be not be considered ‘fair market value’ which could be considered state aid under article 107 of the Treaty on the Functioning of the European Union.
State aid is classed as any form of financial assistance given by central or local government, or other publicly funded bodies, to private companies that might distort a free market. In general terms, the rules are broken only when a public body acts in a way a private investor would not: so a fixed-term rental to a club at commercial rates is fine, but an open-ended commitment to plug holes in the accounts is not.
If a public authority is found to have broken state aid rules, the commission can impose fines and force the recipient of the aid to repay it. This can happen up to 10 years after the event.
Up to now, the campaign has largely been a one-man crusade by Charlton Athletic Supporters’ Trust Campaign Director, Richard Hunt who works out of the Czech Republic but he did get another 13 supporters groups to give their backing, at least in name.
The big question is, what now for the so called fan coalition of 14 fan groups? They have had their day in court, they won and they now have the rental agreement in full so what more damage can they do?
Their ultimate goal is for is for a London football club such as Charlton Athletic or Leyton Orient to raise an official complaint to the European Commission directly. Mr Hunt has raised three complaints to the commission but has failed at each attempt.
In October last year, the London Legacy Development Corporation (LLDC) answered a Freedom of Information (Foi) request in regards to the authority’s contact with the European Commission in regards to deal with West Ham over the rental of the Stadium.
In answering trhe Foi the LLDC confirmed wrote to the EC in July 2015 saying:
“I believe another complaint has been made to the Commission in relation into West Ham and the former Olympic Stadium. Would it be possible for you to let me know in advance of any public statements you might issue in relation to this complaint?”
In May 2015 following the first complaint by Mr Hunt, the EC emailed the LLDC saying
“Following complaints of citizens, the Commission carried out an informal, preliminary investigation into alleged aid provided to West Ham football club.Contacts with the UK authorities and information received from the authorities however did not support the suggestion that West Ham received any state aid. Therefore, on the basis of the available information, the Commission’s services did not see a basis to investigate the matter further.”
The EC wrote back to Mr Hunt in 2014 rejecting his one of his three complaints.
“As explained in our letters. West Ham United has been selected as anchor concessionaire of the stadium (which remains public property) following an open. fair and non-discriminatory bidding process in which four bids were submitted. The conversion works regarding the stadium are also agreed in the framework of the open selection procedure acting as a private market operator would have. LLDC’ moreover negotiated a commercial deal with West Ham United going beyond what was originally offered during the bidding process. We concluded therefore that West Ham United pays a market price for the use of the Stadium. Furthermore, the Stadium infrastructure will operate as a multifunctional facility, open for community use and benefits and also hosting other events, such as athletics championships. concerts and the like.We explained that, on this basis, we came to the preliminary conclusion that the measure objected to apriori does not constitute aid under Article 107(1) TFEU.”
Mr Hunt and Charlton Athletic Supporters Trust also sent a report to the board of Charlton Athletic in 2014 but it appears to have fallen on deaf ears. Maybe Mr Hunt and the other members of CAST should spend more time on the problems going on in their own club. The Board of CAS Trust have repeatedly requested to meet with Charlton Athletic owner Roland Duchâtelet but the club have flatly refused.
In summary, I wouldn’t lose too much sleep over West Ham being fined millions over illegal state aid in the next ten years, the LLDC had some of the best state aid legal experts look over it in advance and I understand the European commission had access to full unredacted version of the agreement as early as 2013 and no issues were raised.
Of course, the big question remains whether the UK will remain in Europe after the vote on Thursday, 23th June but don’t let the threat of possible action over West Ham taint your vote on Britain’s future in Europe whichever way you swing. The state aid question is a dead parrot, it has ceased to be!