November 20, 2012
Does Saving Real Oviedo Comport With American Securities Laws?
Posted by David Zaring

Soccer teams regularly go out of business, but a big one that appears to have dodged what seemed like an exceedingly likely bullet, is Real Oviedo.  RO is historically big, by Spanish standards.  It is the team of Mata, Michu, and Cazorla, for those readers who enjoy the English Premier League, and has fallen on hard times, now laboring in the Segunda Division B and, until very recently, moments away from liquidation.

Except.  Prompted by, among others, the excellent Guardian Spanish soccer correspondent Sid Lowe, Real Oviedo has offered shares of the team, worldwide, via the internet, at 14 bucks a pop. They've sold them to Americans, to Britons, to, well, anyone - and 10,000 people have bought in. RO has realized 1.57 million euros from the offering, mostly from people who have never been to Spain, much less Asturias or gritty Oviedo.

Is Real Oviedo offering securities that must be registered with the SEC? Is it offering a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party, it being immaterial whether the shares in the enterprise are evidenced by formal certificates or by nominal interests in the physical assets employed in the enterprise?  One senses that it may be churlish to answer the question.

And at any rate, the issue may be moot, or suited more for an exam question than anything else.  Carlos Slim - the richest man in the world - seems to have ridden to Real Oviedo's rescue.

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