Tony Xia’s recent decision to sell his stake in Aston Villa should not come as a surprise. Chinese investment in British football has recently slowed due to three key factors:
- Firstly, the realisation that there has been a lack of understanding of the UK football market and system; Chinese investors have not had any significant success in their Premier League investments and operating a football business in a mature market under a formalised regulatory system is very different to the Chinese environment.
- Secondly, currency controls and investment restrictions introduced by the Chinese government have limited what investors can do; unless they were already based in Hong Kong, we now rarely see purely mainland company heavily investing in foreign business (not only football clubs but also property).
- Thirdly, the Chinese FA introducing limits on the number of foreign players at Super League clubs (four in matchday squads and only three allowed on the pitch at any one time) and the number of foreign signings that can be made during a season (six) has reduced the opportunity for British clubs to make money by selling players to Chinese clubs based on informal contacts between the club owners in China.
Unfortunately, we're unlikely to see a change in the tide and European football may need to look to other markets for future investment.