May 24th was a bleak moment for the Chongqing soccer community. With only nine days left before the start of the new Chinese Super League season, Chongqing Liangjiang Athletic Football Club suddenly announced its closure. The use of the word "suspension" seems to be more moderate than "the club announced the closure", however, whether it is called suspension or closure, the fate of Chongqing Two Rivers Athletic has already been fixed, becoming a grain of dust in the long river of history.
Chongqing soccer has no way back
Insiders were aware of the club's final decision long before the official announcement. Players and accompanying journalists have taken to social media to say goodbye to the team they once loved.
Due to the long-term salary arrears, the Chongqing team started a strike on May 16th, and on May 18th, the team hung a striking payroll banner in front of the downtown Chongqing entrance, which attracted widespread attention from the society. To date, players are generally owed more than a year's wages, with the longest being 16-18 months. Long-term salary arrears have had a serious impact on the players' daily lives, with some players having to sell their houses and cars, and club staff even going to send takeaways to make ends meet.
In the meantime, in order to help the club, the coaching staff and players have expressed their willingness to give up their salaries until April 30, 2021 in open letters, but there is still nothing that can be done in the face of the bankrupt Imago Group.
On May 21st, the handwritten situation note by the relevant personnel of Jinsheng Group was forwarded by Wei Xin, the leader of Chongqing team. In this note, Jinsheng Group said: "Chongqing team this season budget of about 170 million, two rivers group of 50 million funding money is the key to the team to participate. If the funding money is in place, the team can compete; if not, Imago Group will stop immediately."
This document also reveals that the Imago Group has invested 3 billion since it operated Chongqing soccer. Now the group is at risk of huge debts and is left to fend for itself.
Debt recovery gets tougher
Before the announcement of the suspension, the Chongqing club was in desperate straits. "The club's management explained to the players at the first team meeting that there is really no money in the account now, and there is no money being injected to continue operations", the insider revealed.
The club has been expecting to save the team through share reform, but there has been no progress in substance. Two Rivers Group's promise of $150 million in funding over three years has also been slow to materialize. "Because the historical debt is too large, the share reform has practically come to a deadlock, unable to find a program acceptable to all parties."
Players will have a tougher time collecting their debts after the club announced its suspension. According to figures posted on social media by team leader Wei Xin, "The club has unpaid $551,696,575.87 by April 30, 2021.The club has unpaid $202,130,702.03 from May 2021 to March 2022." Much of that $700 million-plus debt is owed to players and staff, along with some basic operating expenses.
Although the club's official statement clearly indicated that "will be through the later litigation recovery, debt recovery, asset sales and group borrowing, etc., to do our best to gradually clear the arrears of wages", but as we all know, in the club suspension, due to the legal entity no longer exists, players want to recover wages is almost impossible to complete the task.
In a similar situation to Chongqing is Jiangsu Suning, the league champion of the 2020 season. After suspending operations, the players are owed large sums of wages that have gone unpaid to date. So much so that when Inter Milan won the Coppa Italia earlier, Suning players collectively, through social media, asked Inter's chairman Zhang Kangyang to demand that Suning pay the wages owed to them.
"Now can only be submitted to labor arbitration first, to see how much money can be recovered is how much", a Chongqing players on the 24th to Sohu Sports said.
In the official statement of Chongqing team, it is also mentioned that "the club assets, including furniture, electrical appliances, equipment, vehicles, etc., are carrying the mission of clearing the salary arrears. We hope that we can work together to ensure the safety of the club's industry; at the same time, we also welcome colleagues to actively assist in the search for buyers, as soon as possible to complete the disposal of the club's assets and the settlement of salary arrears."
This statement can only serve as a psychological comfort to the players, and in reality, Chongqing team account has long been no funds. Even if the club's assets successfully complete the bankruptcy auction, the funds that can be returned will be very limited.
