Surprise. Florentino Perez threatens to be excluded from the “Real” elections

The Spanish newspaper “Marca” caused a great surprise after it noted that Florentino Perez, the president of “Real Madrid” and the candidate for the same position in the upcoming elections of the club, is threatened with removal due to an error in the nomination procedure.

After a disastrous season, Perez called for an early presidential election at the club and spoke at a public press conference about his challenge to any potential candidate in the election.

Before the nomination window closes, young businessman Enrique Riquelme yesterday, Saturday, presented official guarantees to run for the position of president of Real Madrid and is expected to be a challenger to Perez for the position of president of the Royal Club.

According to Marca newspaper, Real Madrid’s selection committee has rejected Perez’s request to provide the bank guarantee required to run for the club’s presidency, raising wide-ranging legal questions about the basis for the decision, especially as official club documents indicate that the exclusion conditions may not have actually been met.

Nominated without warranties

On Saturday, the committee announced the approval of Perez’s candidacy without requiring him to provide the “preliminary guarantee” required by the club’s regulations for any presidential candidate. The official statement relied on Article 40.C.5 of the club’s bylaws to justify this exemption, without including the text of the article or specifying any financial data justifying its application in this case.

According to legal website IUSPORT, a 2022 amendment to the Sports Law removed the mandatory guarantee for clubs not listed on sports stock companies, such as Real Madrid, leaving the matter up to each club’s regulations.

Although the club could have deleted this condition from its bylaws, it did not, but instead amended it at an extraordinary general assembly in October 2022, presided over by Florentino Pérez himself, which included the current Article 40.C.5, which is now relied upon to grant him an exemption.

However, the exemption does not appear to be automatic, nor is its legal basis entirely clear. Article 40.C.5, on which the Election Commission relied, refers to successive guarantees that the Board of Directors must provide during the term of office, and not to the initial guarantee of candidacy provided for in Article 40C.3, which does not contain any clause allowing an exception. The legal relationship of the two articles was not clarified in the official message.

Even if the connection between the two articles is accepted, article 40.C.5 requires a certain financial equation to be reached, which states that “The accumulated positive economic results for the Board of Directors must be equal to or higher than 15% of the club’s expenditure budget”. If this condition is fulfilled, the guarantee is not required, and if it is not fulfilled, then the guarantee is given in the amount of the difference. The regulations do not include any other means of discharging a candidate seeking re-election.

Profit of less than 185 million euros

According to an analysis by Marca, based on the club’s official financial documents, including the economic report for the 2024-2025 season and the approved consolidated budget for the 2025-2026 season, the total costs expected this season, calculating operating costs before depreciation, are €1.025 billion, in addition to €2025 million. 1.237 billion euros. Therefore, the required 15% is roughly equivalent to €185 million, which is the figure that management’s accumulated positive profits must reach or exceed for the exemption to apply.

Perez’s seventh term began in January 2025, according to the club. The financial report for the 2024-2025 season, prepared by Ernst & Young and signed by the board of directors on July 17, 2025, shows that the profit after tax for the entire financial year is just 24.3 million euros.

The regulation allows the Board of Directors, which successively renews its powers, to calculate the results of the previous periods as well. Taking the start of the sixth term in 2021 as a point of reference, the club’s net assets rose from €533 million to €598 million by 30 June 2025, a cumulative increase of only around €65 million.

The same article also defines the exclusion of certain items from the calculation process, such as revaluation of assets and certain exceptional incomes, which means that the actual number will be less than that.

Therefore, the maximum possible estimate of retained earnings is EUR 65 million, which is far from the required limit of around EUR 185 million.

While there may be additional legal or accounting justifications that the Electoral Commission took into account without clarifying them in its statement, the lack of an official explanation makes it difficult to understand how the decision was made to exempt Florentino Perez from providing the guarantee, when his rival Enrique Riquelme had to provide it from his own funds.