The PGA Tour and LIV Golf have not yet closed a stunning partnership agreement announced only last week, but vows from Washington to slow or stop the deal – or at least make it uncomfortable for golf executives – crystallised on Monday, when the US Senate opened an inquiry into the arrangement.
Democrat senator Richard Blumenthal, the chair of the chamber’s Permanent Subcommittee on Investigations, said on Monday that he had demanded that both the PGA Tour and the Saudi Arabian-funded LIV give up a wide array of documents and communications tied to the agreement. Blumenthal also asked for records related to the PGA Tour’s non-profit status, suggesting an appetite to challenge the tour’s tax-exempt standing.
In a statement issued three days before the start of the US Open in Los Angeles, Blumenthal decried Saudi Arabia’s “deeply disturbing human rights record at home and abroad” and said the agreement raised concerns “about the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity assuming control over a cherished American institution”.
LIV declined to comment on Monday, and the PGA Tour did not immediately respond to an inquiry. Executives had signalled, though, that they expected their agreement to attract sustained attention from the federal government.
Congress cannot block the agreement simply by opening an investigation, and any legislation to derail the deal would most likely provoke a court challenge. But the spectre of congressional scrutiny and, perhaps, public hearings could tarnish the deal and make the months ahead even more unpleasant for the leaders of professional golf.
Blumenthal has shown a willingness to spar with sports leaders. Lately, he has pressed American universities for information about their sports betting partnerships, and he has lashed NCAA leadership for years over conditions for college athletes.
Although the planned deal has caused some heartburn and sabre-rattling on Capitol Hill, congress has not shown unanimous interest in haranguing golf leaders over it. Republican Senator Ron Johnson, the ranking minority member on the panel that Blumenthal chairs, said last week that congress should stay out of sports.
The PGA Tour’s agreement with the Saudi Public Investment Fund, whose LIV circuit made its debut last year, would bring the business dealings of the rival tours into a new company. The PGA Tour commissioner, Jay Monahan, is in line to serve as its chief executive, and Yasir al-Rumayyan, the wealth fund’s governor, will be its chair.
Under the terms of the agreement, the Saudi wealth fund will have exclusive rights to invest in the new company, positioning it for significant influence over golf’s financial future. PGA Tour officials have insisted, to widespread doubts, that they will be the ultimate decision makers because their allies will hold a majority of the new company’s board seats.
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Professional golf attracted the gaze of Washington regulators before last week’s announcement. Antitrust investigators from the Justice Department have spent months asking questions about the tour’s efforts to deter player defections to LIV and examining whether the tour’s top leaders were too close to other prominent golf organisations, like Augusta National Golf Club, the organiser of the Masters Tournament.
The department has brought no public allegations of wrongdoing and has not commented on last week’s announcement of a deal. But antitrust experts have warned that the department is virtually certain to study it closely and may even step in to try to block it.
Tour executives have expressed confidence that the agreement will withstand any legal challenges.
This article originally appeared in The New York Times.
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