La Liga, the Spanish football league, has been issued with a blanket ban from the government regarding sponsorship by gambling companies, the move comes as part of a new Royal Decree on Advertising. This decrees that advertisements from gambling companies will only be permitted for viewing in the early hours of the morning, between 1am and 5am.
There are currently eight teams playing in La Liga that have gambling companies as their primary shirt sponsors. However, every single team in the league has some form of sponsorship deal or partnership with a gambling company, so the entire league will be affected.
Barcelona, currently in 13th position in La Liga with two games in hand, signed a partnership deal with 1XBet in 2019. The original contract called for sponsorship of the team for a five-year period, which was to include a range of collaborative marketing campaigns and promotions. 1XBet operates a well-known sportsbook and online casino and is a leading figure in the international technology and gaming sector in Europe, Latin America and Asia.
Barcelona have a number of sponsors and partners, but the loss of a prominent gambling brand will certainly have an effect on club finances once the deal is forced to end following the culmination of the 2020/2021 season. It has been estimated that La Liga as a whole will be set to lose around €90 million in combined annual revenue once the ban comes into effect.
The relationship between iGaming and gambling brands and sports teams has become a close one in recent years. For almost as long as there have been sports, people have placed wagers on the outcome. It therefore makes sense for bookmakers and other gambling companies to want to tie their brands to well-known sports teams.
UEFA estimates that 11% of the teams in Europe’s top-flight leagues currently have sponsorship from the betting industry. This makes the gambling sector the third largest sponsor of European football, behind only the retail and financial services sectors. The Spanish ruling, designed to protect vulnerable and young people, has caused issues for many of the top Spanish football clubs.
The smaller clubs are likely to be particularly adversely affected. Losing a key sponsor can result in financial hardships that can affect team performance. Without funding from gambling sponsors, teams such as Valencia which are already struggling financially may have to sell even more key players and are unlikely to have the funds to bring in new talent.
At present, there has been no indication from the Spanish government that there will be any form of financial recompense for clubs forced to drop their sponsors at the end of the season. The president of La Liga has called for a grace period of three years to allow time for teams to attract new sponsors, but the request seems to have been rejected. Spanish football could look very different once we enter the new season in September 2021.