European Football – What would a change in Financial Fair Play rules...

European Football – What would a change in Financial Fair Play rules mean for European football?

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European Football – What would a change in Financial Fair Play rules mean for European football?

The FFP rules that saw Manchester City and PSG given huge fines last year are likely to be relaxed, so what will the repercussions be for European football?.

THE CONTEXT

Financial Fair Play was introduced by UEFA in 2010 to calm the spending of super-rich owners who had previously been able to inject unlimited amounts of money into their clubs. Critics felt that the ability to spend so heavily was distorting the transfer market, making transfer fees and wages soar out of control. After a vote from the clubs the governing body agreed to act, creating rules which stated that no side in a UEFA competition could make a loss of more than 45m over three seasons. The first punishments came into effect in May 2014, withManchester City fined £49m and given restrictions on their European squad for failing to comply. French champions PSG were given a similar punishment, with seven other teams receiving smaller fines.

[UEFA LIKELY TO RELAX FINANCIAL FAIR PLAY RULES]

However, speaking on Tuesday, UEFA President Michel Platini hinted that these rules could be now be relaxed. Reports suggest that this is because of the “multiple legal actions” that UEFA face from clubs and football agents arguing that FFP is contrary to basic European Union rules on free markets. Predictably, the governing body take a different position.

WHAT UEFA SAY

UEFA President Michel Platini (to French radio station RTL): “I think things will be eased. It will be the executive committee which decides and you will know at the end of June. I think that the rules which have been made are very good. Financial fair play was voted for by the clubs. But the French press say it is not right that (Chelsea owner Roman) Abramovich can buy many players and in France they cannot buy them. The world is two-faced but we will say this openly: I think we’ll ease things, but it will be the executive committee who will decide if it is to be eased or something like that, and the outcome will be known by the end of June.”

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Platini has hinted that FFP rules will be relaxed

UEFA General Secretary Gianni Infantino (to the BBC): “Financial Fair Play has proved successful in achieving considerable improvement in the financial health of European football. Aggregate net losses of Europe’s clubs have fallen from 1.7bn euros in 2011 to 400m euros in 2014. Regular review of the regulations is vital to ensure they keep pace with the ever-changing football environment and the new challenges that this often poses. Any potential changes will look to encourage more growth, more competition and market stimulation while strengthening the emphasis on controlling spending and safeguarding financial stability.”

WHAT FFP CRITICS SAY:

Lawyer Jean-Louis Dupont: “We welcome the formal announcement of a change in the rules in line with the demands expressed by our clients in their various legal actions. When the exact content and scope of these changes are known, we will consider with our clients how this development, which on first sight appears favourable, is likely to meet their legitimate expectations and influence the conduct of ongoing actions.”

WHAT CAN WE EXPECT?

At this stage it is very difficult to know how far UEFA will relax their rules but perhaps the Premier League’s own FFP guidelines give an indication of what may happen. Voted in by 13 of the 20 clubs in 2013, the Premier League have now got rules in place that limit their clubs to £105m of loss over three seasons. Clubs will also be punished if their wage bill increases by more than £4m above their commercial revenue in any one season. If UEFA did follow that structure, it would allow a club like Manchester City to increase their net spend by almost £25m a season on average. This news could also stagnate the first month of the summer transfer market, as clubs around Europe wait to find out how much they could demand for their players.

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Manchester City’s spending this summer is likely to increase again

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