Has Financial Fair Play Become a Nightmare?

Hi everyone, UEFA
UEFA is continuing to investigate fewer than 20 European clubs suspected of failing financial fair play rules. The number of clubs suspected of rule breaches has fallen from 76 after further investigations since February.

European football’s governing body will not disclose the identity of the clubs involved. However, Arsenal, Chelsea and Manchester United have told Sky Sports News they are not under investigation.

And it is understood Manchester City do not believe they are in breach of rules after deductions for infastructure, youth and community spending. It is believed they expect to break even at the end of this season.

UEFA’s independent club financial control body (CFCB) will meet on Tuesday for two days in Nyon, Switzerland and discuss further action for clubs that fail to meet its financial requirements. The CFCB is made up of two chambers, one investigative and the other adjudicatory.

Former Celtic chairman Brian Quinn is one of eight officials on UEFA’s Investigatory Chamber. Charles Flint QC, an English barrister, is one of five officials on UEFA’s Adjudicatory Chamber.

UEFA has not yet disclosed the punishment for clubs that fail its rules but it can impose a number of sanctions including a warning, fine, disqualifying clubs from its competitions, including the Champions League and Europa League, and withdrawing a title or award.

Under rules since 2011, European clubs can spend up to £4m (€5m) more than they earn per year but can exceed this level to a certain limit until the end of the 2017/18 season.

Clubs can spend around £37m (€45m) more than they earn until the end of next season – if it is entirely covered by a direct contribution from the club owner or a related party.

Between 2015 and 2018, clubs will only be allowed to spend around £25m (€30m) more than they earn under the same limits. UEFA says financial fair play is “about improving the overall financial health of European club football.” [Source: Sky]

The Financial Fair Play is a very interesting topic. I believe to be difficult to predict what will happen to clubs that make a mockery of it. Can we seriously think that top flight Premier League clubs will be disqualified based on FFP infringements? Has UEFA got the legislative rights to prevent the Royal family of Qatar to invest in PSG through its family owned companies? 

Allianz owns 8.3% of Bayern Munich and signed a €110 million investment deal. Audi and adidas also own 8.33% stake in the Bavarian club and adidas’ CEO Herbert Hainer is now the Bayern MunicPresident . How can UEFA control or regulate money being poured by these companies into Bayern Munich? 

What if Walmart signs a shirt sponsorship with Arsenal for €150 million? Will UEFA question the deal based on the fact that Stan Kroenke owns Arsenal and his wife Walmart?
Point is, the relationships between club owners and club owners’ companies are so intricate that implementing regulation could trigger legal (and financial) headaches.

There must be fairness in football yes. But, is it the right approach to threaten clubs of sport sanctions based on financial behaviour? Will FFP be a living nightmare for UEFA? Time will tell.

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Karl Lusbec

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