Showing All Categories (Show all posts)

Which Championship clubs can expect to receive a Transfer Embargo?

Posted by Ed Thompson on Thursday, October 30, 2014,

With Championship clubs due to submit their Fair Play information to the Football League by 1 December, it is worth considering which clubs are likely to have breached the rules and the likely impact.

Looking at the Championship clubs, 9 are viewed as being ‘Likely’ or ‘Very Likely’ to receive a Transfer Embargo from January.


The Football League will look back at the season 2013/14 and determine which clubs exceeded the permitted loss limits for that season. During 2013/14 clubs were ab...


Continue reading ...
 

Was FFP the reason for high-profile 'Loan&Buy' deals this transfer window?

Posted by Ed Thompson on Wednesday, September 3, 2014,

During the Summer 2014 Transfer Window we saw a number of deals where a player was loaned for 12 months, with the option to buy at the end of the loan. There were a number of reports that FFP was the reason for this type of transaction and it is worth exploring the issue.

There are a number of reasons why clubs might want to enter into a 'Loan&Buy' deal:


To get round a spending cap

Under the UEFA FFP sanctions, Man City and PSG were give a net player spending restriction (in addition to other sa...


Continue reading ...
 

Championship FFP rules ‘undermined’ by Premier League

Posted by Ed Thompson on Monday, May 26, 2014,


Last week, the Championship clubs voted on a number of potential changes to the existing FFP rules. However, as none of the tabled amendments could muster the required 75% of the vote, the rules will remain as they are.  Huddersfield issued an excellent summary of the proposed changes and outlined their disappointment that ‘real-time’ monitoring of finances was not approved.

Under the current rules a ‘Fair Play Tax’ is levied on all clubs that gain promotion to the Premier  League but ...


Continue reading ...
 

Reports of record €60m (£49m) fine for PSG and Man City

Posted by Ed Thompson on Tuesday, May 6, 2014,

Following recent press reports, we now have a much better idea about the sanctions that are reportedly being offered to Manchester City and PSG. It is now up to the clubs to decide whether to accept the terms or risk a potentially more severe punishment. The punishment reported in the press raises a number of interesting questions:


Why is City’s fine so large?

When City filed their accounts, on the face of it they looked to have nominally passed the FFP Break Even test (after permitted exclus...


Continue reading ...
 

Man City failure of FFP test - a matter of choice

Posted by Ed Thompson on Wednesday, April 30, 2014,

So, now we know that Man City (and PSG) failed the FFP Break Even test. However, this was no accident. Man City didn't fail the test because of an oversight - they failed because they chose to fail. The following analogy is helpful: 

I recently handed my son £5 to buy some sweets, telling him to spend no more than £1. Inevitably, he came back with quite a lot of sweets having spent about the £1.50. He didn't exceed the budget because he wasn't able to count - he just evaluated the pros and ...


Continue reading ...
 

The Benefactor Model - permitted in League 1 and 2

Posted by Ed Thompson on Wednesday, April 23, 2014,

The Football League has clarified an important aspect of how their FFP rules operate within League and League 2. Interestingly, the FL have confirmed that their Salary Cost Management Protocol (SCMP) rules permit 'benefactor' owners to finance a club's ongoing losses (something that is restricted within UEFA, the Premier League and Championship rules). 

The League 1 and League 2 rules require clubs to submit regular financial forecasts to the Football League. Only if a club is operating within...


Continue reading ...
 

Would Hull City be allowed into the Europa League next season?

Posted by Ed Thompson on Sunday, March 9, 2014,

 Following today’s FA Cup semi-final draw, supporters of Hull and Sheffield United must feel there is every chance that they could secure a Europa League place next season. This could be achieved either by getting through to the final and beating Wigan, or simply by getting through to a final against Arsenal. Unlike the League Cup, the losing FA Cup Finalist will be rewarded with a Europa League place if the winners have already qualified for UEFA competition.  Arsenal would need to finish ...


Continue reading ...
 

Will Liverpool face any FFP punishment?

Posted by Ed Thompson on Thursday, March 6, 2014,

Since Tuesday's release of Liverpool’s annual accounts for last season (2012/13), fans have been asking whether they will receive a punishment for breaching the Break Even rules.  Unfortunately the FFP rules aren’t straight-forward and it is only when you produce a projection of this season’s finances that you can see how the land lies.

As I advised a couple of days ago, Liverpool will be assessed for FFP compliance over three footballing seasons - they will be able to compete in the Cha...


Continue reading ...
 

Liverpool’s accounts raise interesing question of ‘fairness’ of FFP

Posted by Ed Thompson on Tuesday, March 4, 2014,

Last Friday UEFA held an FFP update in Nyon which provided some excellent information about the current process – however it also gave rise to a number of interesting questions.

UEFA explained that the teams that potentially faced punished for an overspend during the first Monitoring Period are those professional teams that qualified for UEFA competition in 2012/13 and had a Break Even deficit in the 2011/12 season. Although the Monitoring Period looks at accounting performance over two seas...


Continue reading ...
 

UEFA Financial Fair Play update – Nyon 28 Feb 2014

Posted by Ed Thompson on Sunday, March 2, 2014,

On Friday UEFA held an FFP press briefing in Nyon. The 2 hour session provided number of interesting updates - only a few of which have been reported in the British press.

76 clubs referred for Break Even Deficit

As has been widely reported, 76 clubs were required to provide additional financial information to UEFA. Some media outlets probably not at the session seemed to sensationalise what UEFA were saying in respect to the 76. Essentially the 76 clubs are those that met all the following cri...


Continue reading ...
 

Manchester United unable to spend their way out of trouble

Posted by Ed Thompson on Wednesday, February 12, 2014,

In December Martyn Ziegler wrote an interesting piece outlining the financial implications for Manchester United if they don’t secure a Champions League place at the end of the current 2013/14 season. As Ziegler pointed out, the club’s CL income will be reduced next season by around £35m, with the club missing out on a further £10m in gate-receipts. 

Given this probable fall in income, it is interesting to overlay the new Premier League spending constraints and see what impact this fairl...


Continue reading ...
 

Man City release controversial accounts

Posted by Ed Thompson on Monday, February 3, 2014,

Manchester City's long-awaited financial results were released last week. In many ways they raise more questions than they answer. 

As a number of journalists have pointed out, there are a host of Related Party Transactions, Inter-company transactions as well as a sale of Image Rights to a company that the City Press Office insists is outside the club. These obscure transactions have been designed to generate one-off income for the club during the final accounting year that will be covered by ...


Continue reading ...
 

Deloitte's Rich List gives sneak preview of Man City's accounts

Posted by Ed Thompson on Thursday, January 23, 2014,

The annual Deloitte's Rich List reveals some interesting information about Man City's income - figures that have not yet been published owing to delays publishing the club accounts. 

Before we look at the figures, I should point out that  the income catergorisation used by Deloitte in their report is different to the one used by the Club accountants - however it does include all club income. Deloitte catergorise  some of the club's revenue as 'Match Day Income' whereas the club put more of the...


Continue reading ...
 

Wage Spend versus points achieved

Posted by Ed Thompson on Friday, December 27, 2013,

Article and table updated 3 Jan 2014

After West Ham lost to Manchester United just before Christmas, their manager Sam Allardyce remarked tha
“where you actually finish in the league depends on the money you’ve spent. It’s a statistical fact that”.  This raised an interesting point; clubs will spend money to gain a competitive advantage, but, how by much does a high spend influence results? And what kind of spending? It also raises the question of to what extend a team's performance a...


Continue reading ...
 

EC to formally investigate Spain for providing State Aid to clubs

Posted by Ed Thompson on Monday, December 16, 2013,

The European Commission has opened disciplinary proceedings against Spain for giving illegal State Aid to 7 clubs (Real Madrid, Barcelona, Athletic Bilbao, Osasuna, Valencia, Elche and Hercules). The proceedings could have a significant impact on Spanish football.

Independent journalist Sam Wallace originally broke this story. See his articles here and here and here.

There are three areas in which the rules may well have been breached:

Member status

Whilst all other clubs were obliged by the Span...


Continue reading ...
 

Premier League clubs - 'Loss per ticket' analysis

Posted by Ed Thompson on Monday, December 9, 2013,

A study of Premier League club accounts shows that most paying fans effectively have their match-day-experience subsidised by club losses. The table below shows how much extra fans would have to pay for their match tickets if clubs worked on a Break Even basis, with fans making up any deficit.

Obviously the big 'Loss per ticket' figures are the ones that stand out – there probably wouldn’t be too many Liverpool or Man City fans who would continue to go to the game i...


Continue reading ...
 

Player contract disclosure - a lesson we can learn from the Italians

Posted by Ed Thompson on Thursday, December 5, 2013,

One of the most frustrating parts of the transfer window is finding that a player has been sold for 'an undisclosed fee'. Whereas some clubs are happy to disclose the amount that has been paid, increasingly clubs prefer to keep the figure confidential; hoping that it will somehow improve their future bargaining position or possibly avoid the wrath of their fans. As the Guardian reported, only 5 of 115 transfers made in the summer had an officially disclosed fee - a concept they felt was 'an i...


Continue reading ...
 

Paris Saint-Germain and the thorny RPT issue

Posted by Ed Thompson on Sunday, December 1, 2013,

At the weekend, PSG became the first french team to field an all foreign line-up in a league game (in England this first happened with Chelsea in 1999). Their opponents Lyon fielded 7 french players and were hammered 4-0. This triggered inevitable debates about whether the scenario was a good thing, with 63% of respondents in one survey finding it 'shocking. However it looks like something they are going to have to get used to.

Off the field it has been an interesting week for the club.  A sen...


Continue reading ...
 

All eyes on Manchester City's FFP results

Posted by Ed Thompson on Wednesday, November 27, 2013,

Updated 1/12/13

During the next two or three weeks Manchester City will publish their accounts for the 2012/13 season. Like several PL clubs with a bad set of results, City published their previous accounts on a Friday afternoon (when then knew journalistic attention would be kept to a minimum; a practice I highlighted here). Although I expect the accounts to improve, given that this forthcoming set of accounts will complete the FFP jigsaw it will be interesting to see if City repeat the pract...


Continue reading ...
 

How long before we see a Rest Of The World team in the World Cup Finals?

Posted by Ed Thompson on Wednesday, November 20, 2013,

Of FIFA’s 209 member countries, only 47 have reached the Word Cup Finals more than once in the last 30 years.  The 5 African teams taking part in Brazil 2014, will be the same ones that took part in the 2010 Finals. Even with a World Cup made up of 32 countries, most of FIFA’s members have little realistic chance of qualification.

In response to member pressure, FIFA has taken steps to widen representation; both Blatter and his heir-apparent Platini have floated the idea of having 40 count...


Continue reading ...
 

Fair Play Tax in Championship to go to charity

Posted by Ed Thompson on Sunday, November 17, 2013,

Nick Harris, writing in the Mail On Sunday, has delivered a rather nice scoop and discovered that any 'Fair Play Tax' will now be paid to charity, rather than be redistributed to Championship clubs.

The Fair Play Tax (FPT) was introduced to sanction clubs that overspend whilst gaining promotion to the Premier League. The FPT was designed as a deterrent so that clubs are less likely to spend heavily in an effort to get out of the Championship. The rules were announced by the Football League in ...


Continue reading ...
 

BT Champions League deal makes qualification worth £40m+

Posted by Ed Thompson on Sunday, November 10, 2013,

BT's acquisition of the Broadcasting Rights for Champions League and Europa League football has significant implications for the English game.  On the face of it, paying an increased sum for exclusive TV rights seems to be just an extension of current trends. However, when we look at the huge sums involved and calculate the financial impact on the clubs involved, it becomes clear that this deal will have far-reaching consequences.

To put this new deal in perspective, in 2011/12, UEFA received ...


Continue reading ...
 

Pellegrini set to avoid tax via 'Image Rights' scheme

Posted by Ed Thompson on Monday, October 7, 2013,

Manchester City boss Manuel Pellegrini is set to take advantage of new legislation in Guernsey to reduce his UK tax bill.  A press release today announced that Pellegrini is one of the first high-profile individuals to seek to use the new Channel Islands tax loop-hole - a move that could see him save up to £500k a year in tax.

The concept of Image Rights was originally established to ensure people in the public eye are able to control the use of their image and receive adequate remuneration f...


Continue reading ...
 

Istanbul Stock Exchange issues warning to top Turkish clubs

Posted by Ed Thompson on Sunday, September 29, 2013,


All is not well with Turkish football and last week the Istanbul Stock Exchange regulators warned the ‘big 4’ (Galatasaray, Besiktas, Fenerbahce and Trabzonspor) that they must take immediate action to improve their finances. 

The Stock Exchange is concerned that all four clubs have short term debts that exceed their revenue – essentially they are severely short of working capital. There are therefore some doubts about whether the clubs should be considered a 'going concern'. In order to...


Continue reading ...
 

Widening gap between elite clubs and 'the rest'

Posted by Ed Thompson on Wednesday, September 18, 2013,

Immediately after last night’s set of rather predictable Champions League results the excellent Nick Harris fromwww.sportingintelligence.com tweeted an interesting comment on FFP’s impact on the Champions league.  Nick made a very valid point; the gap between the elite European clubs and ‘the rest’ appears to be widening:

This is an interesting point and raises a number of issues which are worth exploring (including the reasons behind this inequality, and the role of FFP).

Although many...


Continue reading ...
 

Further pressure on Arsenal HAGL link

Posted by Ed Thompson on Wednesday, September 18, 2013,

Back in May I wrote an article about Arsenal's link with the deforestation company HAGL in Vietnam.

The pressure group Global Witness has increased the pressure on Arsenal to sever their links with company. BBC London's Sara Orchard produced a TV report on this issue:

http://www.youtube.com/watch?v=Uu1yQK17zIQ


Continue reading ...
 

Wages vs Points: scaled tables

Posted by Ed Thompson on Thursday, July 25, 2013,

Wages vs Points: scaled tables 

In February I published a scaled version of the Premier League table which also showed wages paid on the same scale as points earned. The table gave an interesting perspective on which clubs were over and under-performing. I have now updated the table to show the end-of-season position*. 

The red and green lines have beedn drawn to highlight the performances that seem to be the most interesting. Whereas the February table gave a good indication of performance, th...


Continue reading ...
 

UEFA FFP loop-holes

Posted by Ed Thompson on Monday, July 15, 2013,

When FFP was first introduced, most people wondered what loop-holes high-spending clubs would find to get round the rules. Now that we have seen the first published accounts for the first FFP season (2011/12), we have a much better idea about the various options clubs might use.

UEFA are very serious about the analysis of the club accounts and are using accountants, largely from the top two firms, to check accounts for any clubs using non-authorised techniques to help them Break Even.

I have at...


Continue reading ...
 

FFP summary table

Posted by Ed Thompson on Wednesday, July 10, 2013,

The 2013/14 season is a watershed for financial constraint in football. For the first time, all English professional divisions have rules in place that restrict their spending. The restrictions are summarised in the attached table. This table and an accompanying article appears in the latest August edition of When Saturday Comes magazine (Brazil on cover). I also presented this at a recent seminar on FFP at Birkbeck college (University of London).

Note to editors, the above table (or variants ...


Continue reading ...
 

Man City's frugal summer spending

Posted by Ed Thompson on Wednesday, June 26, 2013,

On the face of it, this might appear to have been an expensive summer for Man City; they have just sold Tevez at a £35m loss and have recently spent £50m on Fernandinho and Navaz. Football fans might follow the narrative that says that Man City are 'laughing in the face of FFP'. However, owing to the way football finances operate, the reality is somewhat different.

When judging whether a team has made a profit or loss for the season, transfers fees are spread out over the duration of the con...


Continue reading ...
 

Further legal challenge to FFP by Striani and Dupont

Posted by Ed Thompson on Thursday, June 20, 2013,

Following the initial legal challenge to FFP in May by Daniel Striani via sports lawyer Dupont, a second legal challenge has been raised.  I have attached the Press Release in full with attachments:

Striani opens second front on legal challenge to UEFA’s break-even rule

20 June 2013 - Belgian player agent Daniel Striani is continuing his challenge of UEFA’s Financial Fair Play rule today by launching a legal action in the Court of First Instance in Brussels.  The process will ask the Court ...


Continue reading ...
 

Monaco aiming to become a 'boutique club'

Posted by Ed Thompson on Tuesday, May 28, 2013,

French football is currently agonising over how to deal with newly promoted AS Monaco – a club backed by Russian potash billionaire Dmitri Rybolvlev which has recently embarked on some headline-grabbing spending (including Falcao for a reported E50m and Victor Valdes). 

The independent principality of Monaco has a population of around 36,000 and has separate tax laws to France. Although French nationals pay the same rate of tax as in France, overseas players living in Monaco (other than Amer...


Continue reading ...
 

Platini grilled about FFP

Posted by Ed Thompson on Monday, May 27, 2013,

On the eve of the Champions League, Michel Platini gave an extended interview to the Mail’s Martin Samuel. Samuel has long been an outspoken critic of FFP and certainly put the UEFA head on the spot.  Platini was left to struggling to justify some elements of FFP (although, as Platini pointed out, English isn't his first language). The full transcript of the interview really is an excellent read – click here.

Following Bayern’s win, a number of football pundits suggested that FFP would m...


Continue reading ...
 

Campaign to end Arsenal's link with ruthless deforestation company

Posted by Ed Thompson on Saturday, May 25, 2013,

A campaign is underway to force Arsenal to examine their links with controversial Vietnamese logging and rubber company HAGL. 

Money-spinning end-of-season foreign tours to exotic places are now common-place for Premier League clubs and few people initially questioned Arsenal's plan to visit Vietnam. After all, Arsenal has an established academy with one of Vietnam's biggest clubs HAGL ('HAGL-Arsenal Academy') and are keen to market the club in the Far East. However their links to HAGL look se...


Continue reading ...
 

Legal challenge to UEFA FFP rules by 'Bosman' Lawyer

Posted by Ed Thompson on Thursday, May 9, 2013,

Jean-Louis Dupont, the lawyer who was successfully challenged football contract laws for Jean-Marc Bosman in 1995, has now challenged the Financial Fair Play rules with the European Commission. Football Clubs themselves are restricted from easily challenging the FFP rules (other than through the Court of Arbitration for Sport – CAS) because the rules were voted-in by the European Club Association. Hence Dupont is pressing the challenge on behalf of a Belgian football agent, Daniel Striani. ...


Continue reading ...
 

‘FFP was introduced following English success’

Posted by Ed Thompson on Thursday, May 9, 2013,

Italian site http://tifosobilanciato.it  has published an unusually candid  interview with Umberto Gandini, AC Milan Organising Director and Vice President of the European Club Association.

The European Club Association (ECA) is the representative association for Europe’s top clubs and is headed by Karl-Heinz Rummenigge, with Gandini as Vice President.  The ECA works with UEFA whenever rule-changes are being proposed and also petitions UEFA for change. The Financial Fair Play rules were prod...


Continue reading ...
 

QPR need quick Premier League return to avoid becoming a 'zombie club'

Posted by Ed Thompson on Monday, April 29, 2013,

Now that QPR have finally been relegated, it seems an appropriate time to outline the financial implications for the club (and other clubs in the Championship).

Perhaps the best place start is with a projection of the financial position for the club up to the end of next season (i.e. the end of their first season in the Championship):

I should point out that this carries a much heavier ‘health-warning’ than most of my projections – we simply don’t know how successful the club will be in...


Continue reading ...
 

Sunderland's Tullow Oil sponsorship ends amid controversy

Posted by Ed Thompson on Thursday, April 18, 2013,

Sunderland's contentious sponsorship deal with 'Invest In Africa' has hit problems. Amid some confusion, the club's lucrative deal has been cancelled, with the club suggesting the split is 'by mutual consent'. 

Back in July 2012 I wrote an article about Sunderland's new sponsor 'Invest in Africa' - a 'non-profit organisation' backed by Tullow Oil. At the time, many people were surprised by the size of the sponsorship deal which reported as being 'worth £20m a season'. This was a significant i...


Continue reading ...
 

Galatasaray ‘teetering on the edge of bankruptcy’

Posted by Ed Thompson on Tuesday, March 19, 2013,

On the face of it, things don't get much better for Galatasary fans. They have a team of top stars, are through to the last 8 of the Champions League and have now been drawn against Real Madrid - life is certainly sweet for the Turkish champions. However, the club has spent heavily and recent announcements from the club confirm the club has some serious, immediate problems. 

Club President Aysal recently revealed that the club is teetering on the edge of bankruptcy with total debt of $328m. Wo...


Continue reading ...
 

Could UEFA strip Malaga or PSG of a Champions League title?

Posted by Ed Thompson on Thursday, March 14, 2013,

With Malaga and Paris St-Germain in the last 8 of the Champions League, questions have been raised about the impact of potential FFP punishments on the Qatar owned clubs’ campaigns. Both are very much the ‘bad boys’ of FFP and it is interesting to explore what might happen to the clubs if either win the current UEFA Champions League campaign.

Paris St-Germain look likely to fall-foul of the rule relating to the Break Even requirement which requires clubs to balance their incomings and ou...


Continue reading ...
 

Liverpool – large cash injection from owners required under FFP rules

Posted by Ed Thompson on Sunday, March 10, 2013,

Liverpool recently reported a £40.5m loss the 2011/12 season (the first year of the initial FFP Monitoring Period).  I have attached a table summarising the accounts, together with a projection for the next accounting period.

Not being a Liverpool supporter, I am grateful for the assistance of Mike Donald (@mdonald1987) for his help in pulling the above together and providing information on events at the club.

The good news for Liverpool fans is that the club appears to have turned a corner. B...


Continue reading ...
 

Paris St-Germain 'find' €125m to help them Break Even

Posted by Ed Thompson on Thursday, March 7, 2013,

If UEFA wanted to find one club to illustrate the concept of ‘financial doping’ it would probably point to Paris St-Germain. 

Although the club hasn’t posted formal accounts for two years* they have had to provide figures to the DNCG [the organisation that oversees club accounting on behalf of the Ligue de Football Professionel (LFP)].  DNCG publishes the account information and I have attached the relevant page for PSG for the year ending June 2012 (with my highlights and translation of...


Continue reading ...
 

Time to call clubs to account

Posted by Ed Thompson on Wednesday, March 6, 2013,

Premier League clubs are resorting to increasingly devious actions to bury bad financial bad news. Comparatively few fans are skilled at analysing club accounts so rely on journalists to interpret their team's financial results for them. However, clubs realise that if there is bad news to presented in the accounts, they can avoid the unwelcome glare of media and fan attention by timing their release so the news is not fully reported.

Recently Aston Villa released their annual accounts (another...


Continue reading ...
 

Wage and the Premier League scaled table

Posted by Ed Thompson on Sunday, February 10, 2013,

Recently, the www.sportingintelligence.com website produced a Premier League table drawn to a scale where every point was given the same vertical scale. This type of graph is know as a Cann Table and a website dedicated to them can be found here. The website www.experimental361.com also produced some very attractive charts showing the tables in this visual format.

The spending constraints recently voted in by Premier League clubs are essentially designed prevent club debts by tackling escalati...


Continue reading ...
 

Premier League clubs adopt spending constraints

Posted by Ed Thompson on Thursday, February 7, 2013,

Premier League clubs have voted to introduce spending constraints.  I will cover-off the changes over the next few days and look at any anomalies within the rules – however, at the moment much of the information is still to reach the public domain.  The Premier League’s communication of the new rules can be round here.  For now, it is interesting to look at how the Premier League executives managed to  get the rules over the line.

If you look on the Premier League’s website, the one term...


Continue reading ...
 

UEFA introduces a new 9th FFP sanction - PSG beware

Posted by Ed Thompson on Wednesday, January 30, 2013,

I have been supplied with an internal UEFA document that is not currently in the public domain - it provides information on the FFP process and punishments that are not widely available. I am grateful to Diego, on twitter @Tifbilanciato  who runs the website http://tifosobilanciato.it for the 'heads-up'. Diego's site carries a large number of english articles and is a library of footballnews and references - well worth following on twitter.

The pdf presentation below was produced by UEFA for t...


Continue reading ...
 

Paris St-Germain attempt to circumvent FFP rules

Posted by Ed Thompson on Friday, December 21, 2012,

French newspaper Le Parisien reported that Paris St-Germain have signed a huge sponsorship deal with the Qatar Tourist Authority. The four-year deal is said to be worth E150m this season, rising to E200m in the final year of the arrangement.  The deal is also reported to be back-dated so that the club will receive the full E150m this season, even though deal has only just been announced.

PSG are 100% owned by the Qatar Sports Initiative (QSI), which is in turn owned by the Qatar Investment Aut...


Continue reading ...
 

Manchester City's 2011/12 accounts - the Devil is in the detail

Posted by Ed Thompson on Sunday, December 16, 2012,

Back in May, I published a projection on whether Manchester City were on track to meet the FFP criteria. Now that the club’s financial results for last season have been released, it seems a good time to revisit the original projection and look again at the club's FFP challenge.

On Friday, City officially announced a loss of £99.7m for the season 2011/12. Interestingly, many journalists were not impressed that the figures were released late on a Friday afternoon in an apparent, though fairly...


Continue reading ...
 

Time to draw a line under state sponsorship of football clubs

Posted by Ed Thompson on Wednesday, November 28, 2012,

Two of the Premier League's top clubs are sponsored by airlines based in the UAE.  Arsenal are sponsored by 'Emirates air line', based in Dubai, whilst Manchester City are sponsored by 'Etihad airways' based in Abu Dhabi.


By way of background, the UAE is roughly the size of Ireland and is a federation of seven emirates (equivalent to principalities), each governed by a hereditary emir with a single national president. The constituent emirates are Abu Dhabi, Dubai, Ajman, Fujairah, Ras al Khaim...


Continue reading ...
 

No Premier League consensus on FFP

Posted by Ed Thompson on Saturday, November 17, 2012,

Premier League Chairmen met on Thursday to discuss implementing spending constraints into the Premier League.  Clubs have become noticeably more positive about the prospect of spending restrictions over the last two years and the Premier League executives (notably Peter Scudamore) have had to change their stance on the issue.

Although most club owners now believe some kind of restriction is going to benefit them, finding a single approach that will be acceptable to 14 of the 20 Premier League ...


Continue reading ...
 

TV revenue distribution – comparing Italian and English models

Posted by Ed Thompson on Monday, October 29, 2012,

Last week Diego Tarì (twitter @Tifbilanciato) had a significant scoop on his site www.tifosobilanciato.it when he published a club-by-club breakdown of Italian TV revenue for Serie A in the 2012/13 season.  The story was quickly picked up by various sites including Italian sport newspaper Tuttosport. The Tuttosport article (in Italian) is attached here: 

2012 10 26 Tuttosport article.pdf2012 10 26 Tuttosport article.pdf
Size : 451.915 Kb 
Type : pdf

 This information is particularly interesting as the breakdown of TV revenue is...


Continue reading ...
 

Ipswich - big club, big problems

Posted by Ed Thompson on Monday, October 8, 2012,

Ipswich used to be one of the most envied club in the Football League.  They have an impressive history, winning the League Championship in 1962, the UEFA cup in 1981 and the FA Cup in 1978. They were also the League runners-up in runners-up in 1981 and 1982.  Even though they are now struggling in the Championship, they still get average gates of around 17,000 – an amazing feat for a town with a population of just 155,000. That works out to around 11% of the entire population attending the...


Continue reading ...
 

Will Chelsea pass the FFP test?

Posted by Ed Thompson on Wednesday, October 3, 2012,

There have been some distinctly mixed messages coming out of Chelsea regarding FFP. On one hand, the club have spent lavishly on players such as Hazard and Oscar but on the other, the club has declared their commitment to FFP. In a recent club statement, Chief Executive Ron Gourlay announced that the was 'in favour of rules promoting financial stability' and added that 'from Chelsea's point of view, we have been working very hard to comply with FFP criteria,' 

This will have left football foll...


Continue reading ...
 

FFP punishments for overspending - UEFA clarification

Posted by Ed Thompson on Sunday, September 23, 2012,

As readers of this site will be aware, there are 8 available UEFA punishments.  However, one of the key FFP questions is whether UEFA will actually ban a an overspending club.  Important clarification has been provided in an interview with Alasdair Bell, UEFA's director of legal affairs.

Bell explains that he believes that any club that exceeds the Break Even limit by more than 20% will face the most severe punishments.  In practice this means that during the current two year Monitoring Period...


Continue reading ...
 

An alternative to the Premier League English Player Quota problem?

Posted by Ed Thompson on Friday, September 21, 2012,


The internet is full of ‘crack-pot’ ideas, from personal jet-packs to underwater hotels (as proposed by Joe Cala, one of Pompey’s former prospective owners proposed).

Occasionally some of these ideas take root. Back in November 2011, Blogger Maracanazo proposed an alternative FFP punishment to the outright ban suggested by the rules. He suggested that overspending clubs could be docked points from the group stage of the Champions League or Europa League.  Perhaps Platini reads his site, ...


Continue reading ...
 

Will Transfer Window activity affect Liverpool’s plan to meet FFP?

Posted by Ed Thompson on Thursday, September 13, 2012,

Will Transfer Window activity affect Liverpool’s plan to meet FFP? 

Back in May I published an assessment of Liverpool's finances and a projection on whether they were on track to pass the FFP test (link). I pointed out that things were very tight and to meet FFP requirements the new manager would certainly not have 'war-chest' for new signings - existing players were going to be sold so he could bring new ones in.  Since then, the club's owners have issued an 'open letter' to fans to outlin...


Continue reading ...
 

Atletico find there’s more to Financial Fair Play than just “Break-Even”

Posted by Ed Thompson on Tuesday, September 11, 2012,

Atletico find there’s more to Financial Fair Play than just “Break-Even” 

The term “Financial Fair Play” is often used when talking about the need for a club to meet UEFA’s Break-Even requirements.  However, UEFA’s FFP rules run to around 90 pages and cover significantly more than just the need for a club to balance their debits and credits. UEFA have just announced that 23 clubs have had their UEFA prize money withheld under the banner of “Financial Fair Play”. One of the 23...


Continue reading ...
 

If losses are 'trending in the right direction' will a club pass the FFP test?

Posted by Ed Thompson on Wednesday, September 5, 2012,

It is quite common to read journalists state that a club will pass the FFP test if it is 'trending in the right direction' (i.e losses are reducing each year).  However this is probably the single biggest misconception about the FFP rules. The confusion is due to something called Annex XI, a rather tortuously worded post-script added to the FFP rules specifically to help clubs comply with FFP in the early years. The most common incorrect beliefs are:

Incorrect FFP beliefs
1As long as the club i...


Continue reading ...
 

Inter sell 15% stake in move to work round FFP rules

Posted by Ed Thompson on Thursday, August 2, 2012,

Inter’s owners, the Moratti family, have signed a deal to sell 15% of the club to China Railway in a deal that will raise E75m.  In a move that appears to be deliberately designed to work around the FFP rules, the club have announced that the funds will be used to build a new 60,000 seater stadium for Inter.  Inter failed to make the Champions League this season and had already been struggling to meet the FFP criteria.

Under the FFP rules, only specified types of income (termed ‘Relevant i...


Continue reading ...
 

Sunderland's sponsor - a charity or an Oil Company?

Posted by Ed Thompson on Thursday, July 26, 2012,

Sunderland recently made a surprising announcement when they unveiled their new £20m-per-season sponsorship deal with a ‘charity’ called ‘Invest In Africa’.  However all is not as it first appeared; it transpires that 'Invest in Africa' is actually a ‘not for profit’ organisation with only one employee, accused of being a ‘PR front’ for a contentious oil extraction company.

Football clubs don’t usually have paid deals with charities or 'not for profit organisations'. Blackbu...


Continue reading ...
 

Scudamore proposes FFP rules for the Premier League

Posted by Ed Thompson on Wednesday, July 11, 2012,

Premier League Chief Executive Richard Scudamore has announced the that Premier League is looking into the prospect of introducing its own Financial Fair Play rules. Appearing before the Commons Select Committee on Tuesday 10 July, Scudamore advised that they are setting up a Working Group and aiming to have proposals before clubs during February/March 2013.


With the Football League having introduced their own FFP rules, the Premier League has been criticised for growing levels of debt and for...


Continue reading ...
 

FFP Challenges heard by CAS

Posted by Ed Thompson on Tuesday, July 10, 2012,

Any club or individual that feels aggrieved by a punishment applied by a League or footballing body is able to apply to take their case to the Court of Arbitration in Sport. Subject to certain criteria, CAS may to able to arbitrate on the case.  Recently two Turkish teams have been punished by UEFA for breaches of  FFP rules and have taken their case to CAS. The results have interesting implications for the implementation of FFP.  They also show how challenges to FFP punishments may be applie...


Continue reading ...
 

Naming Rights - the next step. Could clubs incorporate sponsorship in their name?

Posted by Ed Thompson on Thursday, June 28, 2012,

Shortly after arriving at Wembley before the 1975 FA Cup final, FA officials insisted that Fulham black out the manufacturer’s name on their boots (you can see their name-free boots in this clip).  Obviously a great deal has changed in 37 years and today there is precious little that isn’t sponsored - even the competition now calls itself ‘the FA Cup sponsored by E.ON’.  

 One of the consequences of escalating wage-bills has been the rather unseemly scramble for increased commercial re...


Continue reading ...
 

New Premier League TV deal to resolve FFP worries

Posted by Ed Thompson on Tuesday, June 19, 2012,

It isn't often that sporting journalists are genuinely shocked, but the new Premier League TV rights auction surprised many. The rights to broadcast the Premier League matches from 2013 to 2016 within the UK were up-for-grabs and had been expected to be sold for a similar sum to last time. Owing to the aggressive bidding from BT and the desire by Sky to hold onto most of the matches, the bidding closed at £3.018bn (a huge increase of £1.2bn from the last auction).  For an excellent in-depth...


Continue reading ...
 

Understanding events at Liverpool

Posted by Ed Thompson on Thursday, May 24, 2012,

Understanding events at Liverpool 24 May 2012

It has been a fairly eventful couple of weeks at Liverpool and a number of pundits have expressed their surprise at how a manager that has reached two cup finals could be sacked.  To understand the situation, a good place to start is with the club accounts. 

Firstly, I should direct readers to Swiss Ramble's excellent blog where he covers Liverpool's finances in his usual superb manner. By using the club accounts, Swiss Ramble's analysis and my work...


Continue reading ...
 

Will City pass the FFP test? Part 2

Posted by Ed Thompson on Thursday, May 17, 2012,
This is the second half of an article, to see the first part click here.

Notes

Note 1: Gate Receipts

Although there is a limit to the growth potential of ticket sales, I have assumed a 10% year on year increase in Gate Receipts (additional Champions League Gate Receipts are shown separately in Note 3).

Note 2: TV Media

City's TV and Merit payment details are as follows.

TV/Media/Merit Payment

 2010/112011/122012/13
TV/Media/Merit Payment55.260.660.6
Domestic Cups8.628.6
Europa League*5  
 68.862.669.2
*E...

Continue reading ...
 

Will City pass the FFP test? Part 1

Posted by Ed Thompson on Thursday, May 17, 2012,

Following the dramatic events at the Etihad, I have received lots of interest from people asking the same question: “Will City pass the Financial Fair Play test?”  To answer this question you need to make a large number of assumptions about the club’s footballing and financial performance.  The assumptions that I have used are outlined in the Notes section but in summary they include the following main assumptions:

  • City continue their success and win the Premier League, FA Cup and reach ...

Continue reading ...
 

Football Financing in the Premier League

Posted by Ed Thompson on Friday, May 11, 2012,

Now that all clubs have finally published their accounts for last season (Liverpool being the laggards), UK newspapers are starting to produce their analysis of the finances of the Premier League clubs. 

Matt Scott in the Telegraph produced an in-depth analysis of club accounts, including net transfer spending (something that isn't easily identifiable).  It is highly recommended.

James Lawton in the Independent wrote a very interesting article about the lack of governance in the Premier League ...


Continue reading ...
 

Falling Euro makes it harder for English clubs to pass FFP test

Posted by Ed Thompson on Monday, May 7, 2012,

UEFA's Financial Fair Play rules spell out how much a club is a able to lose and still comply with the FFP financial requirements.   The figures are all documented in Euros.  Clubs struggling to comply with the rules will have noticed that the falling Euro is making the task much more difficult.

The chart above shows how much the Euro has fallen since its July 2011 peak. The first and second Monitoring Period limits have fallen by almost £4.5m.

It remains to be seen whether UEFA will be lenien...


Continue reading ...
 

The Bundesliga - a vision of the Premier League future?

Posted by Ed Thompson on Wednesday, May 2, 2012,

Although this site takes a generally positive view towards UEFA's Financial Fair Play rules, it is important to appreciate that the changes carry some risks for the Premier League.


Many journalists, fans and people working in football are concerned that UEFA's Financial Fair Play rules will reduce the excitement of the Premier League and that the larger clubs will dominate the domestic competitions. Martin Samuel from The Mail is one of the more outspoken critics of the rules, but he is certai...

Continue reading ...
 

Fans may be kept in the dark over Football League FFP transfer embargoes

Posted by Ed Thompson on Tuesday, May 1, 2012,

The newly announced Championship and League 1 & 2 Financial Fair Play rules rely on the use of a 'transfer embargo' as the main sanction for overspending clubs in the Football League.  The first transfer bans for League 1 and 2 clubs under the new rules will commence from the start of next season (2012/13).  However the Football League have confirmed that fans may be kept in the dark about any transfer ban imposed on their team.


When contacted, the Football League explained that they have a 'l...
Continue reading ...
 

Financial Fair Play rules introduced into the Championship

Posted by Ed Thompson on Sunday, April 29, 2012,

Championship clubs have voted 21-3 in favour of introducing strict new Financial Fair play rules.  Clubs that overspend will be punished with a Transfer embargo. The details are attached here.

Plans to introduce a model that restricted clubs to spending a percentage of their turnover have been abandoned in favour of 'breakeven' model that restricts the level of losses a club can make.  In the face of practical and legal challenges (outlined in my previous article), the first sanctions will not...


Continue reading ...
 

Transfer Bans to be imposed next season in League 1 and League 2

Posted by Ed Thompson on Sunday, April 29, 2012,

League 1 and 2 clubs have agreed to continue the Salary Cost Management Protocol (SCMP) and impose transfer embargos on overspending clubs from the start of next season (2012/13).

Under the SCMP, clubs needing to restrict spending on wages to a percentage of their turnover (55% in League 2, and 65% in League 1 reducing to 60% in 2013/14).  Clubs are required to submit regular up-to-date budgetary statements and forecasts throughout the season. The League will impose a transfer embargo as soon ...
Continue reading ...
 

Scottish Premier League to impose "newco" rules following Rangers collapse

Posted by Ed Thompson on Wednesday, April 25, 2012,

The fall-out from Rangers financial collapse continues. Scottish Premier League (SPL) clubs will vote on new rules at the end of April that would be applied if a club enters Administration or if it suffers liquidation and is replaced by a new club (or "newco").

In future, any club entering administration would be docked 15 points (or 1/3 of their points at the time of the insolvency event, if that is a greater number of points).

Significantly, any "newco" would also be docked 10 points from the...


Continue reading ...
 

City's FFP challenges and the implications for UEFA

Posted by Ed Thompson on Thursday, April 19, 2012,

There has been a great deal of interest recently in whether Manchester City will pass UEFA's FFP test for the first Monitoring Period. The debate merits an explanation of how the FFP rules will apply to City and the implications for the club.

The first UEFA Monitoring Period covers the two seasons either side of the 2012 Summer Olympics (the 2011/2 and 2012/13 season. Clubs have to report losses below E45m (or £38m) over this two year period (i.e. an average loss of no more than £19m a seaso...


Continue reading ...
 

UEFA issue clearer FFP explanation

Posted by Ed Thompson on Sunday, April 15, 2012,

The full UEFA FFP rules have been criticised as being overly-long and difficult to understand. To overcome this, UEFA have issued a summary guide which they distributed as part of a press pack.  It is recommended reading for anyone wanting to gain a better understanding of Financial Fair play. I have attached a link and have also put this on the FFP Explained page.

FFP Press Kit EN_FINAL_en _1_.pdfFFP Press Kit EN_FINAL_en _1_.pdf
Size : 505.653 Kb 
Type : pdf


Continue reading ...
 

FFP for Championship proving unexpectedly difficult and facing punishment delays

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 5 April 2012

Football League proposals for the introduction of Financial Fair Play rules appear to have run into difficulty and a delay in implementing the rules looks increasingly likely.

In June 2011, the Football League (FL) announced that Financial Fair Play rules would be introduced into the Championship from the 2012/2013 season.  The FL set out a schedule that would have seen the proposals circulated and then ratified at their Quarterly Meeting of all 72 clubs in Februa...


Continue reading ...
 

UEFA publishes their 8 punishments for breaching FFP rules

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 4 April 2012

At the UEFA conference in Istanbul, UEFA ratified three more disciplinary measures for clubs that breach FFP rules.  As I outlined in my article on 7 Feb, five measures had previously been agreed at the Nyon Conference in January. The full menu of punishments now reads:

  1. Reprimand / Warning
  2. Fine
  3. Deduction of Points
  4. Withholding of Revenue from UEFA competition
  5. Prohibition to register new players for UEFA competitions;
  6. A restriction on the number of players that a club ma...

Continue reading ...
 

Spending for a Competitive Advantage

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 1 April 2012

At the Soccerex conference in Manchester, one of football's foremost Administrators, Trever Birch  (with Leeds and Portsmouth on his CV), outlined how  "the Championship is a scene of carnage with clubs pursuing the Holy Grail of promotion, losing between £5 million £10m a year and a third of them spending over 100 per cent of turnover on wages."  Birch had previously explained that the problems at Portsmouth had resulted from the club aiming to gain a 'competi...


Continue reading ...
 

UEFA close door on legal challenge and talks tough

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 29 March 2012

Last week was an truly excellent week for Platini and saw him secure approval from the European Commission to the Financial Fair Play rules. Platini has been concerned that any excluded club may challenge the legality of the punishment (hence he recently bolstered his legal dept) (see article from 16 March).  Approval from the European Commission was essential for Platini as he has now closed the door on any legal challenge.  He must have been delighted to see t...


Continue reading ...
 

Ticket prices subsidised by club losses

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 22 March 2012

Analysis by www.financialfairplay.co.uk reveals the increased ticket price that clubs would need to charge if they were to manage on a 'break-even' basis and if the ticket prices were increased to account for the shortfall.  The study of Premier League finances reveals that fans receive match-day ticket subsidies averaging at £25 per ticket.  Although Man City's place at the top of the subsidy table will surprise few, the level of loss per ticket sold (£161) i...


Continue reading ...
 

Spanish Tax debt causes stir in Germany

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 20 March

Last week, questions were asked in the Spanish parliament about the amount of tax that was owed by Spanish clubs to the government.  The government was forced to admit that it was owed  €752m in back taxes (including 48m owed by Barcelona and 155m owed by Atletico Madrid).  The issue was quickly compounded by the Sports Minister Miguel Cardenel brazenly announcing that they were looking at ways that debt could be written-off.  The reaction from German clubs w...


Continue reading ...
 

UEFA boosts legal dept to face FFP challenges

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 16 March 2012

David Conn of the Guardian is one of the most informed journalists regarding FFP. He has contributed to a particularly interesting article produced by CNN.  He outlines that UEFA are "readying themselves for legal challenges from top clubs and sending out a clear message they will be able to counter them," Conn points to the strengthening of the UEFA licensing and legal team with the appointment of top English lawyer Alasdair Bell."

http://edition.cnn.com/2012/03...


Continue reading ...
 

The German footballing model

Posted by Ed Thompson on Sunday, April 15, 2012,

Article publishe15 March 2012

Dan Storey at football365 has written an excellent article on the German footballing model. He makes some interesting points:

  • A minimum of 51% of each club must be owned by the club's members
  • Club members have the ability to directly affect the running of the club
  • A season ticket for Borussia Dortmund costs £152 for 17 domestic home games and one European game
  • Average attendance in the Bundesliga last season was 42,690 (7,000 more than the Premier League)
  • Due to the...

Continue reading ...
 

Fans heavily subsidised by high-spending clubs

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 11 Mar 2012 

With UEFA keen to ensure clubs' expenditure matches their income, we have carried out some high-level analysis of the subsidy levels that fans currently enjoy.   Looking at two clubs currently in the media spotlight (Man City and Portsmouth), we have calculated how much extra the average fan would have to fork-out if they were to pay the market rate for their ticket (based on the club operating on a break even basis).  

The results are fairly staggering. Man City ...


Continue reading ...
 

Chelsea hit hard by AVB adventure

Posted by Ed Thompson on Sunday, April 15, 2012,

Article published 10 Mar 2012

Under FFP regulations the cost of acquiring a player's contract (i.e. the transfer fee) has to be written off over the life of the contract.  However, the same restriction does not apply to other contracts. The cost of acquiring a manager's contract (eg.  André Villas-Boas) can be written-off immediately as a one-off hit against that year's financial results.  When Chelsea sacked Ancelotti, they decided to write off the cost of paying up his contract AND the cost...


Continue reading ...
 

Sanctions to be ratified on 20-21 March in Istanbul

Posted by Ed Thompson on Sunday, April 15, 2012,

Sanctions to be ratified on 20-21 March in Istanbul 7 Feb 2012

At the 24/25 Jan Executive Committee in Nyon, a number penalties for failing to meeting FFP criteria were agreed. Three sanctions are still to be approved and will be tabled at UEFA EXCO in Istanbul at the end of March.  The Media Pack has been attached at the foot of this article and outlined the penalties as follows:

Potential Sanctions
  • Reprimand / Warning
  • Fine
  • Deduction of Points
  • Withholding of Revenue from UEFA competition
  • Prohibitio...

Continue reading ...
 

The bell tolls for Pompey

Posted by Ed Thompson on Sunday, April 15, 2012,

The bell tolls for Pompey 2 Feb 12

If Michel Platini lies awake at night wondering about the wisdom of pressing ahead with FFP regulations, he might do well to consider events at Portsmouth.

Pompey went in Administration in 2010 having run up debts of around £135m. The club had adopted a wage structure that could only ever be sustained through cash injections from the Gaydamak family. Once the funds dried up, the club found they could not pay the wages and Administration followed.

In a recent i...


Continue reading ...
 

Rummenigge calls for City to be banned - Mancini takes the bait

Posted by Ed Thompson on Sunday, April 15, 2012,

Rummenigge calls for City to be banned - Mancini takes the bait 6 Dec 2011

A public argument has broken out between Bayern Munich and Man City over the penalties for breaching Financial Fair Play regulations. In an interview with Austrian website www.90minuten.at Bayern CEO Rummenigge makes a stinging attack on City’s spending and expressly calls for UEFA to exclude them from European competion..  Rummenigge explains:

“I recommend that Uefa should think of harsh punishments, otherwise there...


Continue reading ...
 

Novel punishment proposed for FFP breaches

Posted by Ed Thompson on Sunday, April 15, 2012,

Novel punishment proposed for FFP breaches 26 November 2011

With a UEFA committee due to meet in January to determine the punishment tariff for FFP breaches, an interesting suggestion has been proposed by a blogger at http://www.maracanazo.com/ .  UEFA's previous plan to impose a transfer ban for certain FFP breaches seems to have hit the buffers (due to restraint-of-trade issues and the fact that control of player registrations rests with FIFA and national associations, rather than UEFA).  Th...


Continue reading ...
 

UEFA shelves Transfer Ban punishment

Posted by Ed Thompson on Sunday, April 15, 2012,

UEFA shelves Transfer Ban punishment 24 November 2011

The Telegraph published a significant FFP article which maintains that UEFA have had to withdraw one of the proposed punishments for exceeding the Break Even deficit. The use of a transfer ban was put forward as a favoured punishment at the ECA in September (see article below). However it appears such a ban would fail the EC's restraint-of-trade rules.  This seemingly leaves UEFA with only three options:

  1. Levy fines as a punishment (however t...

Continue reading ...
 

Media confusion over first Monitoring Period

Posted by Ed Thompson on Sunday, April 15, 2012,

 Media confusion over first Monitoring Period20 November 2011

In the rush to comment on City's recently announced £195m loss, a number of columnists have submitted incorrect copy regarding the duration of the current Monitoring Period.  The error seems to have started in a Press Association article on 18 November and has been included in a number of separate articles, including those in the Guardian, Telegraph and Mail.  To clarify, the current Monitoring Period lasts for TWO years (not three...

Continue reading ...
 

City downbeat over meeting FFP criteria

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 18 November 2011
Man City today announces losses of £195m for 2010/11 season. Significantly they have taken a distinctly downbeat tone over whether they can meet the FFP criteria for the first Monitoring Period.  The club announced:

"As we undertake the club's commercial transformation, we are cognisant of the incoming Uefa financial fair play regulations and consequently we continue to maintain positive and ongoing dialogue with all appropriate football authorities."

Being 'c...

Continue reading ...
 

Platini discusses watered down punishments

Posted by Ed Thompson on Sunday, April 15, 2012,
Platini discusses watered down punishments 15 Oct 2011
Although the UEFA rules on Financial Fair Play, quite clearly spell out the punishments for clubs which overspend (non-compliance=no licence to compete), Platini has this week discussed imposing lesser punishments for rogue clubs (see link below).  In the Der Spiegel interview Platini discussed 'a range of possible sanctions' with exclusion being one of them.  Interestingly, the concept of reduced punishments such as fining clubs and/or im...

Continue reading ...
 

Chelsea outline their plan for Financial Fair Play compliance

Posted by Ed Thompson on Sunday, April 15, 2012,
Chelsea outline their plan for Financial Fair Play compliance 9 Oct 2011
Steve Tongue in the Independent on Sunday pulled together an excellent article on the challenges faced by Chelsea in order to comply with the Financial Fair Play rules.  Bruce Buck (Chelsea's Chairman) outlined the 4 actions the club will be taking:
  1. Reduced spend on transfer fees for new players
  2. Reduced spend on wages
  3. Increased sponsorship income (possibly including selling stadium naming rights)
  4. Increased match-day incomes
Of...

Continue reading ...
 

FFP catches Sunderland Short

Posted by Ed Thompson on Sunday, April 15, 2012,
FFP catches Sunderland Short 5 Oct 2011
It was interesting to see that Sunderland used 'Financial Fair Play requirements' as part of the justification for Niall Quinn's change of roles. In a move that signalled the increasing frustration of club owner Ellis Short, Quinn was this week replaced as club Chairman. In an unusual move, Ellis Short now becomes club Chairman.  Quinn will now focus on "developing Sunderland's profile and business interest overseas". Clearly,
all is not well at Sunderlan...

Continue reading ...
 

Chelsea decision long overdue

Posted by Ed Thompson on Sunday, April 15, 2012,
Chelsea decision long overdue 4 Oct 2011
Stamford Bridge have known for some time that they need to improve the income generated from their Stamford Bridge stadium.  With a capacity of 42,000 and generating around £82m of match-day income each season, the stadium compares particularly poorly to Arsenal who are able to generated around £122m over the same period.  Of course Arsenal have the benefit of a shiny new stadium and wisely decided to build extensive corporate facilities in a successf...

Continue reading ...
 

Owners asked to dig deep

Posted by Ed Thompson on Sunday, April 15, 2012,
Owners asked to dig deep 2 Oct 2011
With the financial reporting season upon us, the impact of FFP is starting to hit home with club owners.  Although clubs are able to report a deficit of up to E45m during the current two-year Monitoring Period, clubs are only able to record this level of loss if the owners are willing to put their hands in their pocket and inject Equity that will cover all any deficit amount over E5m.  Where the owners are not willing to subsidise the club in this way, the m...
Continue reading ...
 

Arsenal can only break even

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 1 Oct 2011
Arsenal are viewed by UEFA as a role model - they play nice football, are not owned by a 'Sugar Daddy', they have built a lovely new stadium and operate on financial model that will seemingly ensure FFP compliance. UEFA will therefore have been pleased to read Arsenal's recent financial results (their last ones to be produced before the first Monitoring Period).  Although Arsenal announced a profit of £15m before tax, they recorded a profit of just £2.2m once tra...

Continue reading ...
 

How to solve a problem like Carlos

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 28 Sep 2011
Following Tevez' refusal to come of the bench against Bayern, a number of pundits proposed that Tevez should be 'sacked' or be 'left to rot in the reserves' for the rest of his contract. Other than the employment law issues surrounding these two proposals, there would also be a FFP impact:

Sacking option
Tevez was signed two years ago for a reported fee of around £45m/£48.  Under FFP rules, his value will have been 'amortised' or written-down and he now has a 'boo...

Continue reading ...
 

Inter do not expect to meet FFP requirements

Posted by Ed Thompson on Sunday, April 15, 2012,
Article written 9 Sep 2011
Further light was shed on Inter's role in proposing lenient FFP punishment at the ECA conference, when Massimo Moratti, the Inter General President, announced that Inter are not ready currently meeting the FFP requirements. Suddenly it all becomes clear...



Continue reading ...
 

European Club Association sub-group proposes FFP leniency

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 8 Sep 2011
Following the dissolution football's elite club organisation 'g14' in 2008, UEFA has sponsored the creation of the European Club Association. At the ECA conference in September, board member Ernesto Paolillo,(Internazionale General Director)  chaired a sub-group which convened to propose the penalties that they felt should apply for FFP breaches. Although all UEFA documentation is clear (i.e. non-compliance = no licence), surprisingly, the group proposed that the p...

Continue reading ...
 

Will the Etihad money be enough for City?

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published  22 Aug 2011 
Etihad's reported £400m deal over 10 years includes a provision to spend around £100m on developing the stadium complex.  Although the numbers are not yet fully in the public domain, it seems around £30m a season will be earmarked to subsidise City's huge wage-bill in their quest to meet the FFP requirements. Given that City are currently running losing £100m+ every season, they face a seemingly impossible struggle to bring down the FFP deficit total  to und...
Continue reading ...
 

Some clubs expected to fail FFP test

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 17 Aug 2011
Privately, a number of sports and financial journalists believe some clubs will fail the meet the FFP criteria. However people are reluctant to puttheir heads over the parapet and say as-much publically.  Things are starting to change. In an article published by Reuters, Neil Patey from Ernst &Young (a former Abramovic adviser according to the Edinburgh Evening News) has stated publically that he expects some clubs to fail the FFP test. 

"If I was a betting man I w...

Continue reading ...
 

Record Etihad Deal

Posted by Ed Thompson on Sunday, April 15, 2012,
Article Published 12 Jul 2011Eyebrows were certainly raised by the size of the Etihad sponsorship deal with Manchester City. Etihad, who are yet to report a profit and have a similar sized fleet to UK-based Flybe, have reportedly paid City around £400m in a 10 year deal which will extend the existing shirt-sponsorship
deal and re-brand City's stadium complex as "The Etihad Campus".  Not all of the Etihad funds will be used to boost City's coffers for the purposes of FFP - a reported £100m ha...
Continue reading ...
 

Barcelona sponsorship - from heroes to zeros

Posted by Ed Thompson on Sunday, April 15, 2012,
Article published 19 May 2011

Barcelona unveiled their new shirt bearing the Qatar Foundation logo.  Barcelona President Sandro Rosell and coach Pep Guardiola championed Qatar's successful World Cup bid and were rewarded with the E170m 5-year deal just 8 days after the World Cup hosts for 2022 were announced. Barcelona had been struggling to comply with the FFP criteria and desperately needed the income from this huge deal. The Spanish FIFA delegation were also keen to arrange a reciprocal vot...


Continue reading ...
 
 

Categories