FIFA has announced plans to introduce private investment into a new commercial subsidiary, FIFA Forward Enterprise (“FFE”), in a move which could represent one of the most significant developments in the commercialisation of global football.
Reports suggest that FIFA is considering selling a minority stake in FFE to private investors, with the subsidiary reportedly valued at around $20 billion. FIFA would retain majority control, while investors would acquire an initial minority interest and FIFA’s 211 member associations would collectively retain an economic stake in the vehicle.
The proposed investment reflects the extraordinary commercial value generated by FIFA’s global competitions, most notably the FIFA World Cup, which remains one of the world’s most valuable sporting assets through its broadcasting, sponsorship and licensing revenues. However, the proposals have attracted significant scrutiny, with UEFA and other stakeholders raising concerns over whether private investment could influence the future governance and direction of the sport.
FIFA maintains that investors will have no control over sporting matters, with responsibility for governance, competitions and regulatory decisions remaining within FIFA’s remit. The proposal nevertheless raises a wider legal and commercial question: can football’s governing bodies unlock the value of their global assets while preserving the independence, accountability and sporting principles that underpin the game?
This article considers the legal framework surrounding FIFA’s proposed restructure, the implications for member associations, clubs and commercial partners, and the governance challenges created by the increasing commercialisation of football.
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Background: What is actually being proposed?
FIFA is incorporated as a Swiss association under Articles 60-79 of the Swiss Civil Code. This is the same legal structure adopted by a number of international sporting organisations, including UEFA and the International Olympic Committee, and provides member-based organisations with considerable flexibility to establish their own governance arrangements.
FIFA’s membership comprises 211 national football associations, with ultimate authority resting with its Congress and Council rather than an external sporting regulator. Although FIFA operates as a non-profit association, this does not prevent it from generating significant commercial revenues through broadcasting rights, sponsorship, licensing and tournament-related activities.
The proposed structure would see FIFA’s principal commercial activities transferred into FFE, including media rights, sponsorship, licensing and aspects of tournament delivery. FIFA has stated that it would retain majority control of the subsidiary, with investors acquiring only a minority, non-controlling interest. FIFA has also emphasised that responsibility for sporting governance, competitions, the international calendar and regulatory matters would remain exclusively with FIFA.
FIFA has presented the proposal as a means of increasing investment into football development. Reports suggest that the structure could unlock more than $10 billion in additional funding over four years, alongside significant distributions to FIFA’s member associations. For smaller member associations in particular, such funding could represent a substantial increase in available resources and may prove influential when the proposal is considered by its Congress.
Further reports have suggested that member associations have been given a limited period in which to consider participation in the proposed investment structure, with associations reportedly able to invest approximately $40 million in return for potential future benefits, while those choosing not to participate would receive a lower allocation. The reported structure has attracted criticism from some commentators, who argue that differing financial incentives could affect the independence of member associations when considering whether to support FIFA’s proposals.
The proposal should also be viewed against FIFA’s previous efforts to attract external investment and expand its commercial portfolio. In 2018, FIFA explored a reported $25 billion investment proposal linked to plans for an expanded Club World Cup and a new global Nations League. Although that particular investment structure did not proceed, FIFA subsequently continued to pursue the expansion of its global competitions, including the introduction of a new expanded Club World Cup format.
The creation of FFE therefore represents the latest stage in FIFA’s broader strategy of increasing the commercial value of its global assets, including its flagship competitions and associated media, sponsorship and licensing rights.
UEFA’s response has been notably critical. It has argued that football’s governance structures should not be treated as commercial assets and has warned that the interests of the game cannot be separated from the institutions responsible for overseeing it.
Two issues are likely to be central to the ongoing legal and governance debate.
First, reports that certain investors have explored acquiring a greater interest in FIFA’s commercial operations may raise questions about the practical meaning of describing the investment as “minority” and “non-controlling”.
Secondly, concerns have been raised that private investors may seek greater influence over commercially valuable decisions, including competition formats, hosting arrangements and the international football calendar. This raises wider questions about whether commercial incentives could begin to influence decisions traditionally regarded as matters of sporting governance.
The legal position: why FIFA is likely entitled to proceed
From a legal perspective, FIFA’s position appears relatively strong.
Swiss association law provides significant autonomy to member-based organisations to determine their own structures and commercial arrangements, provided they operate consistently with their statutory purposes and comply with their internal governance requirements.
FIFA’s status as a non-profit association does not prevent it from engaging in commercial activity. Rather, the restrictions associated with non-profit status primarily concern how any surplus generated may be applied, rather than limiting FIFA’s ability to establish commercial structures, enter into partnerships or create subsidiary entities.
In practice, FIFA already operates a substantial commercial business. Its broadcasting rights, sponsorship arrangements, licensing agreements and tournament revenues generate significant global value. Establishing a dedicated commercial vehicle and introducing external investment would therefore appear to represent an evolution of FIFA’s existing commercial model, rather than a fundamental departure from it.
The key legal issue is therefore unlikely to be whether FIFA has the power to commercialise its assets, but whether the proposed structure complies with FIFA’s own constitutional framework.
A transaction of this scale would likely require approval through FIFA’s internal governance processes, including consideration by the Council and potentially ratification by Congress.
Ultimately, the greatest scrutiny may not arise from Swiss association law itself, but from wider questions of governance, accountability and whether FIFA’s members consider the proposed structure consistent with the organisation’s broader sporting objectives.
Why UEFA’s objection still has force
UEFA’s objection is not necessarily that FIFA lacks the legal authority to establish a commercial subsidiary or introduce external investment. Rather, its concern is that private capital may introduce different commercial incentives into an organisation whose primary purpose is the governance and development of football.
Even if FIFA retains legal majority control of FFE and reserves formal responsibility for sporting decisions, the involvement of investors in a commercial entity valued at approximately $20 billion is likely to create expectations around decisions that affect the value of that investment.
Those decisions may include the expansion of competitions, tournament formats, hosting arrangements, commercial rights strategies and the wider football calendar.
Importantly, influence does not necessarily require formal control. In commercial structures involving significant external investment, investor expectations can shape decision-making through mechanisms such as board representation, information rights, consultation arrangements or broader engagement with management.
The question is therefore not simply who has legal authority on paper, but whether commercial incentives could indirectly influence decisions traditionally regarded as matters of sporting governance.
Football has already experienced similar tensions at club level, where private investment has increasingly influenced strategic decisions while clubs have continued to retain formal corporate control.
There are also potential questions regarding conflicts of interest and governance safeguards. FIFA has stated that its leadership has a responsibility to oversee the development of FFE, but further clarity may be required regarding the future roles of senior FIFA officials and the safeguards that would apply if individuals involved in FIFA’s governance were also connected to the commercial entity.
For member associations considering the proposal, the central issue is therefore likely to be whether sufficient protections are in place to ensure that commercial objectives do not begin to influence decisions affecting the wider interests of the game..
Points of wider legal interest
The proposed structure raises a number of broader legal issues beyond the immediate question of whether FIFA has the power to establish FFE and introduce external investment.
Governance and minority investor protections
Once external investors acquire an interest in FFE, the subsidiary will inevitably be subject to familiar principles of corporate governance and investor protection.
Even minority investors in a commercial vehicle of this size would typically expect contractual protections, including information rights, reserved matters requiring investor consent, governance rights and agreed exit mechanisms.
FIFA’s suggestion that investors will have no operational role will therefore need to be considered against the underlying transaction documents, rather than public statements alone.
A minority investor may not have day-to-day management responsibility while still retaining meaningful influence through contractual rights and shareholder protections.
This distinction between formal control and practical influence is likely to be central to the debate surrounding FFE. The description of the investment as a “minority, non-controlling” stake may be legally accurate, but it does not necessarily determine the extent to which investors may influence strategic decisions affecting the value of the business.
Competition law considerations
The proposed structure may also raise competition law questions.
FIFA occupies a unique position as both the regulator of international football and a significant commercial participant through its ownership and exploitation of major sporting rights.
The introduction of private investment into a commercial entity responsible for FIFA’s commercial assets could therefore prompt scrutiny of the relationship between FIFA’s regulatory functions and FFE’s commercial objectives.
In particular, questions may arise as to whether decisions affecting competitions, formats or the football calendar could simultaneously serve regulatory purposes and increase the commercial value of FFE’s assets.
Competition authorities have previously examined similar concerns where sporting governing bodies combine regulatory responsibilities with commercial interests. The key issue would be whether FIFA’s regulatory decisions remain objectively justified and separate from the commercial interests of FFE and its investors.
Coordinated response risk
If UEFA and national associations were to take collective action in response to the proposals, there may also be competition law considerations arising from that response.
While concerns regarding governance and sporting independence may be legitimate, coordination between competing organisations to exert commercial pressure on FIFA could itself require careful analysis under competition law principles.
Intellectual property and rights structuring
Finally, transferring FIFA’s commercial activities into FFE would involve significant intellectual property and contractual considerations.
Broadcasting rights, sponsorship arrangements, licensing agreements, ticketing operations and other commercial assets are often governed by detailed contractual frameworks, including provisions dealing with assignment, change of control and third-party consent.
Accordingly, the migration of these rights into a new commercial vehicle cannot be assumed to be automatic. A detailed review of existing agreements and rights structures would likely be required to ensure that FFE can validly exploit those assets and that contractual counterparties are appropriately engaged.
Implications for Stakeholders
Member associations should carefully consider the terms of the proposed investment structure, including the shareholders’ agreement and any investor rights, before approving what may be presented primarily as a funding opportunity.
National associations considering any coordinated response should also take appropriate advice, particularly where proposed action could affect participation, commercial arrangements or competition structures.
Broadcasters and sponsors should review existing FIFA agreements for assignment, change-of-control and restructuring provisions, while clubs, leagues and players’ bodies should monitor whether future commercial pressures lead to changes in competition formats or the international calendar.
What happens next?
The next stage of the process is likely to focus on FIFA’s internal approval mechanisms and the detail of the proposed investment structure.
The proposals are expected to be considered by the FIFA Council, with further discussions anticipated around the FIFA Intercontinental Cup in December and a formal Congress vote reportedly expected to take place in Morocco.
The outcome will depend not only on whether FIFA’s members approve the proposal, but also on whether concerns raised by UEFA and other stakeholders lead to amendments or additional safeguards.
Much will also depend on the final terms of the investment arrangements. The shareholders’ agreement, governance provisions and the precise scope of FIFA’s retained “exclusive authority” will be critical in determining the extent to which investors are able to influence FFE’s strategic direction.
As negotiations progress, greater clarity is likely to emerge on how FIFA intends to balance two competing objectives: maximising the commercial value of its global assets, including the FIFA World Cup, while preserving the independence and governance principles on which international football has traditionally been based.
How Culbert Ellis can assist
Our Sports Law team advises governing bodies, sporting federations, leagues, clubs, commercial partners and investors on the legal and commercial challenges arising from the modernisation and commercialisation of sport.
We assist clients with:
- governance structuring, constitutional issues and conflicts of interest arising within sporting organisations and their commercial subsidiaries;
- competition law analysis, including issues relating to market dominance, vertical integration and the interaction between regulatory and commercial functions;
- the review, negotiation and restructuring of broadcasting, sponsorship, licensing and other commercial rights agreements;
- minority investment structures, shareholder protections and exit arrangements for sports-related commercial ventures;
- intellectual property, database rights and rights management issues arising from the consolidation and exploitation of sporting assets; and
- strategic advice to national associations, leagues and other stakeholders on responding to governance and commercial developments within their sport.
As sport continues to attract increasing levels of investment, the legal framework surrounding ownership, commercialisation and governance is becoming increasingly complex. Culbert Ellis combines commercial litigation, intellectual property, competition law and sector-specific sports expertise to help clients navigate these challenges.
How To Get In Contact
For further guidance on these issues, please contact Wing Ming Choi at wingming.choi@culbertellis.com or call +44 (0)203 987 0222.
Accurate at the time of writing. This information is provided for general information purposes only and should not be relied upon as legal advice.
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