Financial Fair Play Regulations

Manchester United and Manchester City split by proposals on Premier League financial controls

 Manchester United and Manchester City are on opposite sides of a new divide in the Premier League: whether the competition should introduce its own Uefa-style financial fair play regulations.
By Matt Scott

8:29PM BST 22 Aug 2012

At the League’s annual meeting the idea of tighter financial controls being imposed on clubs was advanced by Liverpool. It gained the support of a number of their rivals, including United’s chief executive, David Gill, who had previously helped shape Uefa’s ground-breaking Financial Fair Play rules.
 

The delegation from Arsenal is believed to have spoken up in favour. The club’s owner, Stan Kroenke is, like Liverpool’s John W Henry and United’s Glazer family, familiar with restrictive financial regulations through the US sports franchises they own. West Ham United’s joint chairman David Gold also gave his approval.
 

Gold told The Daily Telegraph: “I was involved in bringing in the FFP rules in the Championship and at the time I thought should I get to the Premier League, I’ll lobby for it. I made it abundantly clear we shouldn’t be doing nothing. David Gill was marvellous. He made lots of sense. Even the big clubs now are saying we have to get to grips with costs.”
 

But the subject was not unanimously supported. Manchester City, whose owner, Sheikh Mansour bin Zayed al-Nahyan , subsidised spending with £43.3million in cash between June 1, 2009, and the end of May 2011, are believed to have cautioned that they would prefer to manage their business as they see fit.
 

Fulham, whose rise through the leagues was financed by ‘soft’ loans from the chairman, Mohamed Fayed, have also historically expressed the view that they would not endorse a system that “kills the dreams” of others. However, this time they did not push back against Liverpool’s proposal.
 
It all meant the Premier League executive staff have been tasked with drawing up a report on what proposals could be introduced. One option would be to adopt wholesale the Uefa FFP regulations.
 
Both Chelsea and United were instrumental in developing these, which require clubs to break even within a margin of “acceptable deviation” of €45 million (£35.5 million) over the first two years of their formal implementation – next season and the following.
 
Chelsea and United are confident of meeting Uefa’s rules despite their inclusion not just of cash expenditure but accounting charges relating to historical spending under “amortisation”. However, City will find that particularly challenging.
 
Their Premier League champions’ operating loss in the 2010-11 season alone – the most recent for which accounts are available – was £194.9 million. Even though some areas of this spending will be discounted as allowable, the discounts are unlikely to bring operating losses under FFP to within the £35.5 million cushion over two years.
 
David Gill, Manchester United’s chief executive, has told Parliament: “We were involved through the European Club Association, as were other clubs, such as Chelsea, who were on the working group to develop those proposals with Uefa.
 
“It made sense and was for the benefit of football clubs could operate within their own resources and it would bring about a limiting effect on player cost, in terms of transfers and wages.
 
“We are comfortable with it. The critical issue will be around implementation and the sanctions around that, and making sure that it is appropriately applied. But I do not think anyone can criticise the objective of ensuring that clubs operate within their own resources.”
 
How to guarantee compliance would be one of the biggest challenges of a new Premier League regulatory regime and this month Henry expressed his concerns about Uefa’s will to impose its own FFP regulations. But that view contrasts with recent Uefa actions.
 
The Court of Arbitration for Sport has upheld Uefa’s expulsion under financial fair play rules of Besiktas. The Turkish club will be banned from the next two European competitions for which it qualifies over the next five years.
 
The English top flight is the only league in the country not to have its own cost-restraint framework. Leagues One and Two have both implemented salary capping while the Championship has introduced a financial fair play system for this season based on the Uefa model. Championship clubs flouting Football League rules will be hit with a transfer embargo.

http://www.telegraph.co.uk/sport/football/competitions/premier-league/9493345/Manchester-United-and-Manchester-City-split-by-proposals-on-Premier-League-financial-controls.html

Noticeable that Liverpool proposed it and Citeh are against it

I find this part of the report quite concerning:

At the end of the meeting,  Manchester City owner Sheikh Mansour bin Zayed al-Nahyan handed a cheque showing a seven figure sum, a Rolex watch and a set of car keys to Premier League Chairman Sir Dave Richards who concluded by stating that there would be no rush to implement such "ridiculous" measures

 

If they were enforced properly it would strengthen us but i can't see it happening.

I genuinely believe it can only work if the F.A., in all member countries, decide to impose their own sanctions. Even then it's fraught with legal difficulties... "why do we get punished more by our F.A. than P.S.G. do?" (for example).

I fully understand that we are committed to playing by the rules and respect that but we are playing the game from a lowly position. Hopefully we will look to exploit any loopholes because, if we don't, it's going to be a long, long time before we catch up.

Chelsea and even City have made the leap in time and can now consolidate by using the revenue that Champions League brings (in both in prize/T.V. money and world-wide 'awareness') Man U, debt and all, have massive revenue streams and Arsenal will just potter along, making shareholders money.

I believe that we can record a loss of €15m, over three seasons, which rises to €45m (if the owners put in their 'own' money), without sanction. It might not be much but that €30m could be the deciding factor between success and failure. 

If its implemented it would mean that UTD would have a big advantage over us due to their income being much greater than ours.
There would be a league based on turnover rather than spending as it is now the difference being those with the biggest income could spend the most so what is different about that.

Some excellent points raised by BBB and Walton.

If for example we spent that 30million on a top striker and he helped us achieve top 4 and CL , that in itself would ease our worries of meeting FFP rules, possibly even allowing us next season to rationalise the squad even further without diminishing our effectiveness.

I think if we get left behind now the advantage the CL teams will gain through extra income generated both from CL and enhanced sponsorship might prove almost impossible to compete with as our profits stagnate while theirs accelerates.

Of course United would be in favor of it in the Premier League. It would totally be to there advantage given their revenue. And knowing the FA, United's debt would be completely ignored.

maybe FSG will take Platini to Court if its not implemented as its clear they are already operating within the rules or at least well on the way to them.

maybe FSG will take Platini to Court if its not implemented as its clear they are already operating within the rules or at least well on the way to them.

Well no matter where you stand on FSG, UEFA, and FFP, the thought of Platini getting taken down is quite heart-warming

If its implemented it would mean that UTD would have a big advantage over us due to their income being much greater than ours.
There would be a league based on turnover rather than spending as it is now the difference being those with the biggest income could spend the most so what is different about that.

I thought that if we built a new stadium / expanded Anfield it wouldn't go against us. I thought stadium expansion was exempt, or am i wrong?.

I thought that if we built a new stadium / expanded Anfield it wouldn't go against us. I thought stadium expansion was exempt, or am i wrong?.

FFP spending is only in relation to transfers and player wages, (not including youths). Stadium expansion or anything else related to club spending is exempt.

FFP spending is only in relation to transfers and player wages, (not including youths). Stadium expansion or anything else related to club spending is exempt.

Thank you for clearing that up.

Premier League clubs in landmark meeting

September 5, 2012

By Harry Harris, Football Correspondent

Premier League chairmen and chief executives are to hold talks over the financial future of the division at the quarterly shareholders' meeting on Thursday.

A significant number are keen to introduce self-imposed Financial Fair Play rules to ensure spiralling wages and agent fees do not threaten the existence of clubs in the English top flight, with more than half currently running at a loss.

An insider told ESPN on Wednesday night ahead of the landmark meeting: "The chairmen have been talking about this and have asked for it to be top of the agenda at the first shareholders' meeting of the new season.

"A report is sure to be presented to the chairmen of a detailed breakdown of how much the clubs pay for their footballing staff, and the possibility of a mean average being used as a limit for spending on players, managers, coaches and football staff is sure to be looked at very closely.

"The idea of bringing in Financial Fair Play to the Premier League is under consideration - it happens in Europe, it happens in the Football League, and now the chairmen have to decide whether to ensure that clubs no longer run at a loss and run at a risk."

There is unlikely to be a vote on Thursday, but it is expected that there will be a significant step forward in formulating more detailed proposal and sanctions.

Manchester City are concerned about introducing new rules and the scale of punishment for those that fail to abide by them, but Manchester United appear to be in support of the measures, with chief executive David Gill telling The Times last week: "It will be a very good debate. A lot of clubs would be happy to have Financial Fair Play regulations as laid down by UEFA.

"There has to be a consensus and the clubs have to agree on what is good for the Premier League. Without doubt, enough income is coming in to the Premier League to ensure that clubs don't lose money in my opinion."

Behind the new move is the new influx of TV cash coming into the game next season, with clubs determined that the extra funding does not simply serve to escalate payments to players and agents.

Several Premier League chairmen - including Stoke's Peter Coates, West Ham's David Sullivan and Wigan's Dave Whelan - have already spoken to ESPN to voice their support for the plans.

Phillip Beard, chief executive of QPR, also told ESPN: "We are always keen to listen to what the other clubs are trying to achieve, particularly those clubs who have been in the Premier League longer than we have.

"What I do like about the Premier League is that for any decisions to be ratified it requires 14 clubs to vote to agree to change, and that is sensible, although it does mean quite a few decisions can be short circuited. However, it is clear that everybody wants to find a route to run football in a sensible business way."

http://soccernet.espn.go.com/news/story/_/id/1152061/premier-league-clubs-to-discuss-financial-changes?cc=5739

With 14 votes needed out of 20, I can see this being voted in which is no bad thing.

With 14 votes needed out of 20, I can see this being voted in which is no bad thing.

Trying to think of seven clubs that would go against the changes.

Against

Man City
Chelsea
QPR

Maybes

Sunderland
West Ham
Southampton
Aston Villa

Struggling now, the maybes just based on their spending.

Trying to think of seven clubs that would go against the changes.

Against

Man City
Chelsea
QPR

Maybes

Sunderland
West Ham
Southampton
Aston Villa

Struggling now, the maybes just based on their spending.

Those are good shouts. Maybe Villa would go for it out of the Maybes.

We should hopefully find out soon if this has any legs or not.

I have enough of Accountants, Profit and Loss Sheets and Balance sheets at work!!!, I dont want to see it dominate Football, which should be a game of Passion and escapism for those precious 90 minutes at the weekend....or perhaps Im just a simple man in love with a simple game???

I can hear the abuse even before I post ....

I have enough of Accountants, Profit and Loss Sheets and Balance sheets at work!!!, I dont want to see it dominate Football, which should be a game of Passion and escapism for those precious 90 minutes at the weekend....or perhaps Im just a simple man in love with a simple game???

I can hear the abuse even before I post ....

No abuse, every village needs its simple man. 

I posted in another thread how I yearn for the day we can be fans again and not amateur accountants.

No abuse, every village needs its simple man. 

I posted in another thread how I yearn for the day we can be fans again and not amateur accountants.

Like your style 

Liverpool, United and Arsenal will throw their weight behind fair play rules. THey have to! The FA cannot ignore them, mainly because UTD are the FA.

The FA can ignore it all they want. They're not the organisation that made these FFP rules, neither will they enforce them and apply sanctions. The UEFA will, supposedly.

The FA can ignore it all they want. They're not the organisation that made these FFP rules, neither will they enforce them and apply sanctions. The UEFA will, supposedly.

I meant the FA can't ignore the pleas of Utd, Arsenal and Liverpool, who will be seeking any advantage they can. The beauty of doing it now is

1. THere is minimal risk of a breakaway by City and Chelski and their 4 supporters.

2. The players won't exodus to Spain and Italy because they're broke or Germany because they have rules.

Ahh ok, my bad. I read a bit back now on the previous page, didn't know there's an actual effort to enforce that stuff on a national level too. You're right there, would think the odds are against Man City and Chelsea.

Ahh ok, my bad. I read a bit back now on the previous page, didn't know there's an actual effort to enforce that stuff on a national level too. You're right there, would think the odds are against Man City and Chelsea.

No worries. I can't see how EPL can deduct points from clubs who go into receivership (which is probably just a show anyway considering the situation) who therefore don't operate as a business, yet allow Citeh and Chelski to go on spending like they are.

I hope something happens because we are falling behind as time pass by but i believe city will find a shortcut even if FFP law get passed.
I can see the sheik's cousins/unlce company striking a new ridicules deal with city and city are good to go even under the FFP. There is no winning in this imo but i hope im proven wrong.
UEFA doesnt have the balls to go against the clubs and the FA are making too much money.