This is the second in a series exploring the controversial issue of whether Argentina should allow football clubs to form private sports corporations. Read the first installment here, and look out for the third piece next week.

Brazilian football has traditionally been the ying to Argentina’s yang. Whereas Argentines admire determination, sacrifice and heart, Brazil’s outlook has generally been more about joy, flair and rhythm. 

That’s not to say they have nothing in common. Their footballing identities still revolve around individual expression and talent, far from Europe’s systematized, disciplined styles. But whereas Argentina expresses a brotherly rivalry with Uruguay by magnifying myriad small differences, Brazil presents itself as a more natural, immediate adversary.

Rivalry notwithstanding, both countries are facing the emergence of a foreign club management model that aims to put the business of football front and center. 

This isn’t entirely surprising. In the 21st century, the mass global appeal of football has often rendered the unique universal, putting the sport’s identities in crisis. As award-winning English sports journalist and author Jonathan Wilson wrote, “even [the] sense of communal identity […] has become just another commodity to be traded and exploited” in the modern game. 

In Argentina, President Javier Milei introduced amendments to Argentina’s Sporting Law that opened the door for private sports corporations to compete in the sport. The Argentine Football Association, meanwhile, is fighting tooth and nail to ensure it remains the purview of nonprofit civil associations.

What can Argentine clubs learn from the experiences of their Brazilian rivals?

Options and flexibility

The private sports corporation model arrived in Brazil during Jair Bolsonaro’s government. Like in Argentina, it had long been debated, and it finally prevailed at a time when Brazilian clubs were racking up debts, suffering financially, and beset by accusations of mismanagement.

A law backed by Senator Rodrigo Pacheco, one of Jair Bolsonaro’s closest allies, was passed in August 2021. It created the sociedade anônima do futebol (SAF), or public limited football company — and brought with it a barrage of changes to Brazilian football.

“The law sought to make hugely indebted clubs easier to manage,” Brazilian journalist Valentin Furlan said, “and it did so by giving guarantees through a simplified tax code.”

Under the new law, club members can vote to create an SAF, an independent company tasked only with controlling and managing the club’s professional football assets, such as the professional squad, training field and sponsorship deals. Once the limited company is created, it can seek an investor to buy into the team, either wholly or in part.

All other assets and aspects of club life remain under the control of the nonprofit civil associations, which continue to elect presidents and a board of directors. Clubs are not on the hook for any debts incurred by the SAF with their own estate.

It’s a solution that offers clear and obvious financial and tax benefits. The SAFs enter a specific tax code that means they do not pay the gross amount on federal taxes, and are only held to 4% in federal taxation.

In return, they must devote at least 20% of monthly income to paying any outstanding debt, with six years to fulfill payment. A further 20% goes to the nonprofit civil association in terms of branding, image and historic rights. The rest is freed up for wages, signings and all other operating costs.

“Of course, a new investor can come in and pay the debts from the get go,” said Furlan. “But the [tax code] plan gives flexibility to spread it out, allowing them greater financial stability.”

Since the law was passed, 14 out of the 40 Brazilian clubs in the top two divisions have adopted the model, with six currently in the Serie A, Brazil’s top tier.

Mixed experiences

Since its implementation, the model has had moderate success, but also a list of controversies. 

The first club to aim for the switch was Cruzeiro, one of the country’s most storied clubs. Stuck in the second division for a consecutive year, it was battling potential relegation to the third tier when an unlikely savior appeared in the shape of two-time Ballon d’Or winner and Cruzeiro academy youth prospect, Ronaldo Nazario.

“Cruzeiro had been under management [that was] filled with irregularities and financial problems in 2018,” said Furlan. “The Ronaldo Nazario purchase stabilized the situation and enabled the club to return to the first division.”

At the time of writing, Cruzeiro is second in the Serie A and into the Copa do Brazil semifinals, having played the Copa Sudamericana final in 2024.

Other clubs have been less fortunate. 

Botafogo, another Brazilian giant in distress, was sold to U.S. businessman John Textor in January 2022. The Fogao soon stormed back to the front pages, finally taking a historic league and Copa Libertadores double in 2024. Yet the cracks were quick to appear.

In 2025, Thairo Arruda, the chief executive of Botafogo’s limited company, confirmed the club had been bankrolling another Textor-owned club, France’s Olympique Lyonnais, as far back as 2023. In an open letter to the French club’s directors, Arruda detailed over 120 million euros (US$140 million) in loans from the Brazilian team to Olympique Lyonnais as part of Textor’s “single cash flow” policy.

Textor has since lost control of Eagle Football Group, his holding company, and set up a new fund based in the Cayman Islands to secure control of Botafogo and Belgian club Molenbeek. This, in turn, has left the Brazilian club marooned in a legal battle with Olympique Lyonnais after Textor was forced to relinquish control of the French side.

Another major Rio de Janeiro team, Vasco da Gama, has fared even worse. The club sealed the sale of 70% of its shares to American private investment company 777 Partners in February 2022. Just two years later, it all came undone.

Conflict between the nonprofit civil associations and 777 Partners over lack of investment reached boiling point in May 2024. The club sued the U.S. company for failing to comply with their contract, and a Rio de Janeiro court suspended the company’s ownership, giving control of the SAF back to the club.

A mirror or a warning?

So, has the SAF model ushered in a golden age for Brazilian football? It’s hard to say. Since 2017, every Copa Libertadores winner except one (River Plate in 2018) has been Brazilian, but only one of them was a SAF — Botafogo in 2024.

“It makes it easier for investors to come in and, with a good plan, clean up the clubs’ finances, but it’s not a guarantee for success,” said Furlan. “You can be a club and have good management too.”

It speaks volumes that perhaps the two most successful Brazilian sides of this decade are two of its biggest, most beloved nonprofit civil associations, Palmeiras and Flamengo. The latter, in particular, has become arguably the most successful club outside of Europe, consistently landing marquee signings like Gabriel Barbosa, Pedro Guilherme and Emerson Royal.

Importantly, the debate in Brazil remains exclusively financial, not political. Despite coming into law under Bolsonaro, few changes have been proposed under President Lula da Silva’s administration. Positions on the matter are more transversal and less antagonistic than in Argentina.

“It’s not linked to Lula or Bolsonaro,” said Furlan. “It has a lot more to do with your personal convictions and views on whether having private corporations is a good solution for football than a political discussion.”

If anything, Brazil’s experiences with the limited company system so far serve less as a mirror for Argentine football, and more of a warning about the vices inherent in the system. 

The economics of Brazilian football are worlds apart from Argentina. The 2025 Liga Profesional champions take home US$500,000, a paltry sum compared to the US$13.8 million paid to the Copa do Brasil winners. It’s understandable why investment from private owners has yet to take the league by storm. 

But the stories of Vasco da Gama and Botafogo show what a disruptive partner can look like. At a time when Argentine clubs are starved of investment and desperate for solid financial management, skeptics worry that such disaster cases could become the norm.