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UEFA’s requirement for football clubs to balance their books. The rules also specify that clubs keep up-to-date with their taxes, their transfer fees and pay player wages on time.
To compound their misery at relegation from the Premier League, Queens Park Rangers face the prospect of a fine in excess of £50m for breach of financial fair play regulations. They could even be expelled from professional football.
The gap between the super elite of European clubs and the next tier is getting wider. Clubs like Atletico Madrid, Borussia Dortmund and Southampton have enjoyed success through good management and smart player acquisitions, but sustaining that success is difficult.
Premier League clubs have made their first collective profit for 15 years. Dan Jones, a partner at Deloitte’s authoritative Sports Business Group, hailed the news as a ‘transformative moment’. It showed that the Premier League could keep a grip on costs while still attracting top players. He commented, ‘You can still afford to compete on talent and still have money left at the bottom line.’
We have often commented on the growing number of sports lawyers for whom football is an important and potentially lucrative area of work. EU competition law is also highly relevant and it is often forgotten that the way in which Premier League television rights are sold in seven packages was a formula devised to satisfy the European Commission after an investigation.
The Dutch football authorities have deduced FC Twente three points for failing to make progress on required financial reforms.
One wonders if this could be used more widely given that fines are not a big constraint for wealthy clubs and even transfer embargoes or squad restrictions have their limitations. It could, of course, only be applied at a domestic level.
Leicester City are bottom of the Premier League and increasingly look unlikely to escape relegation. Now they face the additional problems of talks with the Football League about their £20.8m loss in the last financial year and whether it represents a breach of financial fair play rules.
From the League’s perspective it is in excess of the £8m permissible loss, but Leicester consider that £13m of the losses are due to the costs of promotion. They have also reduced losses from £34m in the year ending May 2013.
QPR have reported substantially reduced losses for the last financial year. They are down to £9.8m in contrast to a massive £65.4m in the year ending May 2013. Expenditure is down £22m, largely due to lower player costs. Shareholders have also written off £60m in loans.
The club has faced difficulties over compliance with financial fair play rules, but these results should help their position.
Chelsea have secured the second biggest shirt sponsorship deal in English football history. They have agreed a contract worth £40m a year with the Yokohama Rubber Company to start next season. The club regards it as another important step towards being self-financing and compliant with financial fair play rules.
As far as I know, only one European club has its stadium built on top of a car park: Monaco’s Stade Louise. Of course, space is at a premium in the densely populated principality with its very rich inhabitants. The principality’s royal family is an endless source of fascination for celebrity magazines. If it was a Hollwyood film, you would think it was pure fiction.
The complex structure of Manchester City’s parent company in Abu Dhabi, the City Football Group (CFG),. In the context of financial fair play (FFP) rules, Uefa is interested in how losses are divided up between the parent company and its subsidiaries.