“It’s the happiest day for fans of Club Comunicaciones. We have been fighting for this for 12 years,” explains club member Rodrigo Veiga. “If we work together we can get rid of the $12m debt and have the club back.”
He is talking about how on 21st August the Court of Appeals reversed the ruling that had sealed the sale of the club to the Truck Drivers’ Union, who, with an offer of $52m, had been the highest bidder vying for the bankrupt club. As a result, the club has three more years to clear its debts and remain in the hands of the members, who have been given a month to present a bailout plan.
Roberto Ruiz is another of the hundreds of members who have worked to save Comunicaciones from being sold. He passionately talks of the plans and the work that he thinks will be necessary for this resurrection.
While he talks, I think of the 17-hectare block, valued at more than US$160m, which the club owns in Buenos Aires. There is a lot to be done, the signs of abandonment can be seen all around.
But at last, there are no more judges, no bankruptcy – just children; a lot of children running and playing football in the middle of the roller hockey fields, others just chatting under a tree, and beyond them a sign expressing what was simply a wish, but has now become a reality ‘Comu is not for sale’.
The ruling shows how the privatisation of sporting entities has been resisted in Argentina, privileging the social role that they fulfil. It has also highlighted the fundamental role the members have played in all this process, the regular people who, when they organise and mobilise, can change things.
A Common Good
In Argentina, the vast majority of sporting clubs are still Asociaciones Civiles, or unincorporated, non-profit associations. This used to be the norm in other parts of the world too, which now see economic groups and media corporations, as well as oligarchs and sheikhs, buy up clubs in Europe and North America.
The objective of an Asociación Civil is the realisation of a common good – be it social, cultural or community-based – for which members come together. Their purpose is not profit-driven, and any profit made as a result of their activities must be put back into the project.
Such associations are made up of members. And, as César Francis, a lawyer specialising in sporting issues, says, “members are owners of the club. Members have rights and obligations.”
As ideal as this may sound, the system is by no means perfect. According to Francis: “One of the scores to settle is guaranteeing the exercise of the rights of members. We must foster participation in the community spaces that are clubs, we have to make the handling of the money as transparent as possible, and we must seek the commitment to assume the role that being one of the owners of the space implies.”
Returning to the case, he states: “What has happened with Comunicaciones is very important, as clubs in Argentina make up our collective and individual DNA, our identity. The world registers you by your name and by what team you support. Losing a club is losing part of our identity as a society, it is irreparable; what is at stake is a feeling of belonging.”
The Case of Comunicaciones
Founded in 1931, Comunicaciones was born out of the Postal and Telegraph Union, which is where the club’s yellow and black colours come from – the international colours of post. In 1953, president Juan Domingo Perón donated the club a 17-hectare block in the Agronomía neighbourhood, in the heart of the city.
Like most clubs, Comunicaciones is mainly a football club and it participates in the AFA (Argentine Football Association) league games and tournaments. Having made its footballing debut in 1960, today it is in the third division, the Primera B Metropolitana. But the club is better known as a focal point in the local community by the generations of members and locals who have made use of its swimming pool, tennis courts, or any one of the multiple disciplines that it harbours, or attended the carnivals and fiestas. As a result, the club reached a membership of more than 60,000.
Ruiz explains: “It was impressive. I have lived my whole life opposite here, as a kid I always came to the club to practise sports, to the pool, to the parties. I even became a lifeguard as a result of what I learnt here.”
In the 90s, things started to change. The Argentine postal service didn’t escape the wave of privatisations initiated by the government of Carlos Menem. When, in 1997, the Socma group, led by Franco Macri (father of the current mayor of Buenos Aires, Mauricio Macri), bought the service, it stopped supporting the club. This, combined with bad management throughout the last decade, left the club in a precarious economic situation.
The onset of the 2001-2 economic crisis started to be felt in the year 2000. And the clubs, not just Comunicaciones, were not immune to the crisis. Many of them saw their debts increase and lacked the means to reverse this situation. The most significant case was that of Racing Club in Avellaneda.
In 1998, Racing, one of the five big Argentine football clubs, filed for bankruptcy with debts of more than US$60m. The following year, Liliana Ripoll, the official designated by the justice to oversee the break up of the club under the bankruptcy law, said a phrase that would go down in history: “Racing Club Asociación Civil no longer exists.”
Upon hearing the news, fans marched in protest in various parts of the capital. The following Sunday, Racing was due to play Talleres de Córdoba, but the game was suspended as a result of the club’s situation. People showed up at the stadium regardless, and at the time of kick off more than 30,000 people were in the stands. Finally, facing the prospect of the club being auctioned off, various sympathisers chained the installations to stop it from happening.
As a result of the media repercussions and the social mobilisation surrounding the Racing case, a new law started to be mooted, which considered an exemption for sporting institutions if faced with bankruptcy proceedings.
Supported by the recognition of the social function which clubs carry out, in mid-2000 the national congress passed law 25,284: the ‘Special Regime of Administration of Sporting Entities with Economic Difficulties. Management Trust with Judicial Control.’
The law stipulates the formation of a governing body for the institution facing bankruptcy, which would be judicially controlled, with the key administrators chosen by a judge. The governing body should aim to continue the club’s activities, restructure its finances, and guarantee the rights of creditors, whilst getting back the normal functioning of the entity.
As with many clubs, the ruling played in Comunicaciones’ favour. That same year, with a debt of $12m, it entered under the new regime, and was granted a period of up to nine years to improve the situation and give the club back to the members. If it did not manage to do this, the Bankruptcy Law would be applied and the institution would be liquidated.
A Special Case
So Comunicaciones was given time to regularise its situation, and during the nine-year period, three different governing bodies took the reigns.
However some club members had doubts over the willingness of the governing bodies to really get the club back on its feet, doubts that increased in 2006, when judge Fernando D’Alessadro took over the case, and were confirmed when he named Eduardo Fenochietto as the third head of the governing body.
Veiga talks about some of the irregularities of the process: “The governing body was supposed to be formed by three people and there were two of them, they were supposed to be chosen randomly and instead they were hand-picked, and the participation of the club members’ was supposed to be encouraged.” But that was not the worst, “both the judge and Fenochietto were involved in the bankruptcy of the Hogar Obrero cooperative, and Fenochietto was also involved in the bankruptcy of Zanón Ceramics,” he says.
He continues: “With Eduardo Fenochietto came a policy of expulsion of members, because he knew that a lot of people were opposed to his mandate. First they raised the membership cost sharply under the pretext of having more money coming in, something that didn’t happen, as many members left. At the same time they didn’t allow new members. In second place, they let the club fall into disrepair, they didn’t do anything to maintain it.”
And so the members began to act. “We all got together and we realised that each area of the club had the same problems, and so we decided to work together to get the club back on its feet.” Conversely, the attitude of those who were supposed to be watching over the club was very different. “Fenochietto told the footballers that he was not going to sort the situation out, and he told the school that the club was going to shut down. The only option was mobilisation,” Veiga explains. At the start of 2008, protest marches began.
In October 2009, upon completing the period the club was legally entitled to in order to improve its situation, the members fears were confirmed: nothing had changed, the debt remained at $12m, and Comunicaciones would be handed to the highest bidder.
The city government promised to save the club and executed a plan that included an offer of $26m to pay the debts and improve the installations, and in return it would take six hectares of the club’s land to build a multi-purpose stadium. The offer was doubled by Hugo Moyano, head of the Truck Drivers’ Union, and members accused them of having made a deal.
Ruiz explains: “When we went to the government with 15,000 signatures from neighbours, they welcomed us in and asked that we work for PRO in the 2011 elections, said we shouldn’t worry, and that they would save the club. Two months later Francisco Cabrera, minister of economic development in the city, made a pact with Moyano to hand over of the club in exchange for resolving the issue of trash collection in the city.”
The judge ruled in favour of Moyano’s union – the highest bidders – and immediately a group of members and fans, as well as the city government, appealed the ruling. According to Vega, “the ruling did not consider some fundamental questions, such as the irregularities of the governing body which led us to this situation.”
Francis said: “Beyond the errors that led Comunicaciones to bankruptcy, and how slow the members had been in taking so long to react to the situation, nothing justifies that they prioritised a commercial transaction over saving Comunicaciones, when they were able to save it.”
All It Takes is Good Will
Since the ruling, the members started organising to maintain the day-to-day running of the club. And as such they realised the potential it had. According to Ruiz, “the activities which are going on today generate more than $2m a month of which the governing body only counted $190,000.” Which is why Veiga considers that “with good will from the governing body and with everyone pulling together, it will not be too complicated to pay the debt.”
Today, the members guarantee the full functioning of the club. From more traditional sports, such as basketball, roller hockey, or artistic roller skating, Comunicaciones has also surprised many with its development of major and minor baseball divisions and for being the home to the Argentine Association of American Football championship.
The Little Fish
In July this year, as the appeals process was reaching a crescendo, fans and members of the club were among those who decided to take over the installations, “to say no to the truck driver Moyano”, recounts Ruiz.
Then on 21st August, the members’ dreams were fully realised when the ruling went in their favour, giving them three more years to clear the debts and, with some luck, get the club back.
Veiga, who considered that the ruling which revoked the process of tender “is an act of justice”, summarises the feelings of the members: “We believe that all the clubs in the country have to be Asociaciones Civiles, which belong to the members. We were opposed to the entry of any private offer, this is not something against Moyano in particular, but we do think that the club is for the neighbours, the members, and not for a union.”
César Francis goes a little further in his analysis, stating that: “It is a battle that has been won by the community against the markets. It is a version of the big fish eating the little fish, the markets eating up these community spaces, progress against that which many would like to see as museum pieces.”