Spanish government found guilty of providing state aid to Real Madrid, Barcelona and five other football clubs

SPAIN’S government has been found guilty of illegally funding seven football clubs – including Real Madrid and Barcelona.

The European commission has ruled Spain provided state-funding to help the clubs gain an unfair advantage over their rivals.

And in one instance, Real Madrid were able to buy land to build a new training ground for £15million LESS than market value.

The European Commission launched an investigation into how clubs were benefiting unfairly from tax and finance support from the government.

And they found a long list of tax, land and loan issues that were deemed to be against EU regulations on state funding.

The seven clubs – Barcelona, Real, Valencia, Athletic Bilbao, Atletico Osasuna, Elche and Hercules – have all now been ordered to repay cash which it is ruled has given them an unfair advantage over their rivals.

In complete ignorance for usual rules, despite being registered as limited companies Real, Barca, Bilbao and Osasuna were paying the tax rate of non-profit organisations for over 20 years.

That meant they saved fortunes on tax demands going back until 1990.

All four clubs have been ordered to repay the moneys owed.

A second investigation centred on the price Real were charged to buy land from the government in 1998, as they moved to a state of the art new training ground on the outskirts of the city.

The commission found the land deal was undervalued by an astonishing £15million which now needs to be paid back.

And a third investigation looked into how a state-owned bank illegally stood as guarantors for loans which helped Valencia, Elche and Hercules secure funding at a discounted rate.

All three were cash-strapped at the time, but because the taxpayer agreed to guarantee the loans the clubs secured more favourable terms.

The trio now have to pay back the money saved – which in Valencia’s case is a whopping £17million.

Commissioner Margrethe Vestager, in charge of competition policy, commented: “Using tax payers’ money to finance professional football clubs can create unfair competition.

“Professional football is a commercial activity with significant money involved and public money must comply with fair competition rules.

“The subsidies we investigated in these cases did not.”