LONDON: Spain’s Real Madrid has overtaken England’s Manchester United to become the richest soccer club in the world. Real’s income of 275.7 million euros for 2004-2005 dislodged United with its 246.4 million euros, thus ending the English club’s eight-year standing at the top.

The Football Money League report published by consultants Deloitte Thursday revealed that the income of the world’s top 20 soccer clubs exceeded three billion euros for the first time.

The Spanish club capitalised on the presence on its side of internationals like David Beckham, Zinedine Zidane and Ronaldo, the report contended. Deloitte partner Dan Jones said Real has transformed its revenues, doubling them in just four years.

He said: “Although president Florentino Perez’s strategy of recruiting world class `galactico’ players has not necessarily delivered the anticipated on-pitch results recently, their presence has facilitated a transformation in the club’s financial performance.”

Third in the list of super rich clubs is Italy’s AC Milan with 234 million euros, followed by Juventus and Russian oil czar Roman Abramovich-owned Chelsea of England. The others in the order of their revenues are Barcelona, Bayern Munich, European champions Liverpool, Inter Milan and Arsenal.

The report predicted that French and German teams would move up the wealth ladder in the next few seasons.

Deloitte’s sports business consultant Austin Houlihan said Real Madrid has broken the mould in terms of revenue growth in football and it is its ability to grow commercial revenue that has guided it to the top of the Money League. The club has not won a major trophy for the second straight year.

The report said: “The mainstay of Real’s revenue growth is not match-day revenues, as we have seen in many of the U.K. clubs, or broadcasting revenue, as we have seen — and continue to see — in Italy, but strong progress in realizing their commercial potential.” Commercial revenue including sponsorship, merchandising and licensing contributed 45 per cent of the club’s total income.

The report said Manchester United’s revenue fell because of a reduction in broadcast income. It had exited from the Champions League at the first knockout round.

Jones said Beckham has been a major factor in Real’s show. “You can’t put a figure on his impact but there is no doubt having big-name players makes an impact and he’s the most famous footballer in the world.”

LONDON: Regulators in the U.S. and Europe are investigating possibilities of price fixing in the air cargo industry and several leading trans-Atlantic carriers have been brought under the scanner. In Europe, the European Commission carried out surprise inspections Tuesday at the offices of major European airlines, while the justice department in the U.S. has issued subpoenas to several U.S.-based carriers.

British Airways, Air France, KLM, Lufthansa and Cargolux Airlines of Luxembourg were subject of the inspections in Europe and these airlines said they are cooperating with the authorities probing pricing practices in the industry.

In the U.S., American Airlines said it has a subpoena in this regard. The airline clarified that it has not been told that it was a target of the investigation and did not receive a search warrant.

United Airlines said it received an inquiry from European Commission at its United Cargo office in Frankfurt.

Justice department officials have also searched cargo offices of Japan Airlines at New York’s JFK International Airport. Japan Airlines’ Frankfurt office was also searched by European Commission officials.

South Korean airlines Korean Air Co. and Asiana Airlines Inc., confirmed their offices in Seoul were raided by the local antitrust watchdog, the Fair Trade Commission. The airlines said their offices in Europe and U.S. were, however, not raided.

In Washington, a justice department spokesperson said the U.S. investigators are working with the EU and other authorities to investigate possible “anti-competitive behavior.”

An unnamed federal law enforcement source revealed the raids were carried out on airlines in major cities across the country, including Chicago, New York and Los Angeles.

In Brussels, the European Commission said it had carried out “unannounced inspections” at the offices of several air cargo carriers and these constitute preliminary steps in investigations into suspected cartels.

EC said in a statement that the fact that it carried out such inspections does not mean that the companies are guilty of anti-competitive behavior nor does it prejudge the outcome of the investigation itself.

The commission’s competition spokesperson Jonathan Todd said the commission has reason to believe that the companies concerned may have violated Article 81 EC-Treaty, which prohibits practices such as price fixing. If it is proved, the commission can impose fines.

LONDON: British MPs voted overwhelmingly Tuesday to ban smoking in all enclosed public places. The ban will be implemented in 124,000 pubs and clubs across England from next summer.

In a historic free vote, the MPs rejected a compromise formula, which mooted a partial ban, terming it as “unworkable”. Prime minister Tony Blair and his Labour Party had fought the general elections on this formula, which allowed smoking to continue in pubs that do not serve food.

The vote, 453 to 125, means all pubs and clubs will be covered by the ban. The MPs also dismissed a last-minute proposal to exempt private members’ clubs, voting 384 to 184.

The vote has been welcomed by health groups. England now joins Northern Ireland and Scotland in totally banning smoking in public places. Wales plans to have its own vote on the issue soon.

Among the cabinet ministers voting for a total ban were prime minister Blair, Gordon Brown, Charles Clarke, Peter Hain, Ian McCartney, Margaret Beckett and David Miliband. However, six ministers, including John Reid, John Prescott, John Hutton, Tessa Jowell and Ruth Kelly, supported the compromise, which proposed smoking to continue in not-for-profit clubs such as working men’s’ clubs and the Royal British Legion.

The cabinet has fixed additional levels of fines for defaults. Landlords who allow smoking will face a 2,500-pound fine, which is up from 200 pounds. Individuals who violate the ban will be fined 50 pounds on the spot. In addition, there will be spot fines of 200 pounds for failing to display no-smoking signs. There will be a penalty, if the issue goes to court, which will be1,000 pounds.

The Health Bill, introduced by health secretary Patricia Hewitt last year, has been dogged by cabinet splits and insurrection in the Labour ranks. The ruling party MPs were given a free vote.

The vote was generally welcomed by unions, health campaigners and NGOs. Peter Hollins, director general of the British Heart Foundation, described it as a landmark victory for the public health of the country, which will save the lives of many people across the U.K. Prof. Alex Markham, chief executive of Cancer Research U.K., said the smoke-free law will give all workers, including those in pubs and private members’ clubs, equal protection from the life-threatening effects of second-hand smoke.

Even the British Beer and Pub Association welcomed the legislation. The association’s director of communications Mark Hastings said the association is happy that the MPs have ensured a level playing field for all, with no exemption for private members’ clubs.

The bill will now move to the House of Lords, where it is expected to pass. Once this formality is over, it will become law by mid-2007.

The ban is estimated to cut revenue to pub companies by about 8 per cent, according to consulting firm KPMG International.

LONDON: Britain’s insurance industry has said it can run the proposed National Pension Savings Scheme mooted by the Pensions Commission as a low-cost national savings product for the mass market. It has taken up the challenge posed by the government in the wake of the Pensions Commission report to run a low-cost pension scheme for the entire country.

The Association of British Insurers (ABI) claimed the financial services industry is in a position to ensure that every working Briton starts a savings account and manage it at about half the current cost.

According to the plan unveiled by ABI, workers would pay into a fund via a bank and they would continue to pay into the fund even when they change jobs. Pension providers would market the plan directly to employers, which will cut down on costs.

The country’s state and private pension systems are now on the verge of a collapse on account of rising cost of an ageing population. The Pensions Commission had estimated in 2004 that Britain had a 57-billion-pound shortfall in retirement savings.

The Commission has proposed a series of reforms in the sector, including setting up of the National Pension Savings Scheme and automatically enrolling staff in a pension fund.

Stephen Haddrill, director general of ABI, said, while proposing the industry’s scheme, that the government should also consider setting up an economic regulator to monitor fees and standards in the pensions savings market. He said the market is not free and needs some sort of supervision.

Haddrill said the ABI supports auto-enrolment of workers into savings schemes but it is not in favour of government tax-collection systems to undertake the job. “Companies will market themselves to employers directly … that will take out costs and we will have a more standardised service which will reduce costs further,” he said.

The proposed system will provide a permanent pension account number to a member enabling him to move his pension account between companies without changing pension providers, he added.

The ABI is also prepared to cut the management charge for running pension savings products from the current level 1.3 to 1.5 per cent by about half. The commission has proposed the charges to be around 0.5 per cent.

The ABI is planning to hold discussions with the government on this issue later this month.

Consumer activists group Which? rejected the ABI proposal saying it does not want the National Pension Savings Scheme to become the “biggest gravy train in recent history for the insurance industry”.

Mick McAteer, principal policy officer at Which?, said, this cannot be allowed to happen again. The National Pension Savings Scheme could be what persuades people to save for their retirement and prevent future generations living in poverty.

LONDON: Life insurance company Aviva Plc. has engaged former head of energy regulator Ofgas, Clare Spottiswoode, to advise on policyholders’ interests when it starts reclaiming some 2.1 billion pounds locked in orphan assets in two of its with-profits funds. The surplus cash is an accumulated sum of money over and above the amount that policyholders are contractually entitled to.

According to Aviva, the full value of this surplus, accumulated in its CGNU and Commercial Union Life Assurance Company funds, stands at 3.3 billion pounds. Of this, it is estimated that 2.1 billion pounds is available for reattribution after taking care of minimum solvency requirements. Policyholders have no claim to these funds, but Aviva feels when it is reattributing the assets, there could be clash between policyholders and investors.

Although law stipulates that orphan assets belong to the company, several consumer groups claim there are legislations providing for 90 per cent of the money to be allocated to the policy holders and 10 per cent to company investors.

Aviva, Britain’s biggest insurer, said it is not yet decided whether to proceed with the reattribution, but would do so if there were clear benefits for both policyholders and shareholders.

The exercise would call for compensations to customers who would be giving up their future claims on the excess amount. Any deal would need to have the approval of the Financial Services Authority.

Consumer group Which? has been taking up the cause of the policyholders in this issue. A senior policy adviser at Which?, Mick McAteer, said Spottiswoode’s job would be difficult, as the law is unfairly against policyholders.

Which? chief executive Peter Vicary-Smith said the government view has always been that any attribution of orphan assets should be 90 per cent to policyholders and 10 per cent to shareholders.

Aviva is maintaining that the entire inherited estate is owned by the company. Under FSA rules, the company must compensate policyholders for the loss of the inherited estate, but there is no pre-determined split.

The orphan assets are formed when some of the returns from investments by the insurers are not allocated to policyholders as soon as they are earned. The insurance companies put such earnings aside, bolstering the capital base of the fund or these are used in investing in volatile assets. Some insurers make use of this surplus to issue bonuses to policyholders.