BRUSSELS, Belgium (AP) - A report backed by the European Union said Tuesday that financial scandals, corruption and racism had left European soccer in a dire state and called on the ''direct involvement of political leaders'' to put the continent's' favourite sport back on track.
Three weeks ahead of the World Cup, the report by former Portuguese ministers Jose Luis Arnaut called for stricter corporate governance in the wake of betting and match-fixing scandals in Italy and Germany and financial difficulties that affect clubs across Europe.
''Sports in general and football in particular are not in good health. Only the direct involvement of political leaders, working together with the football authorities, can put it back on the road to recovery,'' said Arnaut, author of the 165-page Independent European Sport Review.
''If these issues are not urgently addressed there is a real risk that the ownership of football clubs will pass into the wrong hands, the true values of the sport will be eroded, and the public will become increasingly disaffected with the `beautiful game,''' Arnaut wrote.
''The financial situation of many European clubs is perilous, with bankruptcy cases and deficits of hundreds of millions of euros,'' Arnaut said.
Apart from the economic liabilities, the report also complained about ''a tendency toward racism'' and even ''trafficking'' in young players from developing nations.
British Sports Minister Richard Caborn said all, including UEFA, had to improve their effectiveness for the sake of the game.
''The big challenge to UEFA and to the European Commission is to look closely at governance in sport. The challenge to national clubs and associations is to look at themselves and see if they are fit for purpose,'' Caborn said.
The report also derided ''ownership of clubs by questionable individuals or organizations, the risk to integrity of sport, particularly as a result of sophisticated international betting operations, the boom in the player agent 'industry,' which adds little if any value to the sport, a tendency towards racism in certain areas.''
It said there was a need ''to take decisive action to combat any criminal activities associated with football, in particular regarding the trafficking of young players and the risk of money laundering.''
The report is now expected to be debated over the next months, with all organizations involved expected to come up with proposals by the end of the year.
It backed views that a homegrown players rule should be reintroduced and a salary cap imposed to reinvigorate the continent's favourite sport.
The review also recommended that clubs continue to release players to national teams without compensation, a bitter issue which went to the EU's highest court earlier this month.
The report was short on concrete measures but did set out that ''UEFA should be established as the formal partner of the European Union to engage in dialogue and to work in co-operation with the European Union to tackle these issues going forward.''
The review was set up in Leipzig, Germany, in December after FIFA president Sepp Blatter made sure wealthy clubs and leagues would not have an independent place at the negotiating table.
For years, FIFA and UEFA have been involved in a feud with the G14 group of the biggest European clubs.
Last week, a Belgian court decided that the EU's highest court will have to rule whether FIFA's practice of refusing to compensate clubs for releasing their players for international team duty is legal.
The review on Tuesday called for ''legal protection for the player release rule, foreseeing that clubs have to release their players nor national team duty without entitlement to compensation.''
The same Luxembourg-based court handed down the landmark Bosman ruling in 1995, which scrapped limits on homegrown players.
The review now said that ''an effective system for encouraging local education of players, based on the obligation for all clubs to have a certain number of homegrown players in their squads coupled with a squad size limitation, to be permitted.''
