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Financial Fair Play

Re: O/T Financial Fair Play

Rivals ganging up to ban City: Liverpool, Chelsea and Arsenal may test Champions League ruling on Financial Fair Play

  • Small print in UEFA FFP rule could affect Emirates Marketing Project's eligibility for the Champions League
  • Jose Mourinho accuses unnamed clubs of 'dodgy FFP'
  • 'Major clubs' away of potential rights to appeal against those considered to have cheated their way to passing FFP test
Arsenal, Chelsea and Liverpool could use UEFA small print to challenge Emirates Marketing Project’s right to play in the Champions League next season.

The rules now effectively set up a scenario where rivals can claim City have cheated their way to passing UEFA’s ‘Financial Fair Play’ (FFP) test.

It is understood lawyers for a host of ‘major clubs’ are aware of these potential rights to make appeals — thanks to recently amended Financial Fair Play (FFP) regulations — and are monitoring the situation closely.

On Saturday night Chelsea manager Jose Mourinho, who faces City on Monday in the game of the season so far, accused some unnamed clubs of ‘dodgy FFP’.

He said: ‘There are clubs that are following exactly the project of Financial Fair Play and there are other clubs doing it in a dodgy way. For me, that is very clear. I don’t say the clubs — that is not my job.’

When asked specifically about City, and a potential UEFA investigation, he added: ‘It’s for Mr Platini and other people to analyse it, it’s not for me… I’m waiting for that.’

FFP rules compel clubs to limit losses for the 2011-12 and 2012-13 seasons combined to £37million, with a ban from European competitions the severest theoretical punishment. City last week announced losses for 2012-13 of £51.6m, meaning they have lost £149.5m over two years.

They can perhaps ‘exempt’ as much as £110m of those losses to meet FFP requirements. But they face accusations their losses are artificially low after earning cash from ‘intellectual property’ sales to related companies. UEFA sources have confirmed this will be investigated to see if it is ‘real’ income.

Amended small print in the 2014 UEFA FFP rulebook, just published, includes two key changes; one allowing clubs to ‘plea bargain’ punishments for overspending, and another that allows other clubs to challenge those plea bargains if they feel the outcomes negatively affect them.

http://www.dailymail.co.uk/sport/football/article-2550222/Rivals-ganging-ban-City-Liverpool-Chelsea-Arsenal-test-Champions-League-ruling-Financial-Fair-Play.html
 
Re: O/T Financial Fair Play

Chelski are just as bad, the difference being that they had their massive financial injection way before FFP was ever mentionned and so they are better off in the here and now. I don't think Mourinho cared all those years ago when Chelski could literally gazump any club to any player they wanted by offering millions more than the other team and stupid wages. They started the problem
 
Re: O/T Financial Fair Play

Yes, Chelsea are as bad, but now they are in the castle they want to pull up the drawbridge.

While I see the inherent unfairness of a sugar-daddy owner helping a club leap-frog those who are carefully building, I'm undecided on the FFP rules. Is it better to allow new inputs of money and to allow new clubs to join the top table or is is better to protect the status quo by making it difficult to improve? In effect we have been kept out of the elite by Chelsea and City outspending us and now the rules will stop us ever taking the same route.

The rules do have a perverseness about them. A new Sheikh or Abramovich is blocked, yet these two have put close to 2 billion into football, money that has gone to footballers, coaches and others in football. On the other hand, the rules do nothing to stop the likes of the Glazers who have taken half a billion out of football to pay interest and bank fees. It's strange that an industry draws up rules to protect those taking money out and block those putting money in.
 
Re: O/T Financial Fair Play

Would it be controversial for me to state that despite the 'sugar daddy' element of their practice, the drubbings and the fact that they have made it even harder for us to reach the top-table…

I actually quite respect the model City are building 8-[ They certainly don't have the ****ish element that Chelski have always had.

*dives for cover*
 
Re: O/T Financial Fair Play

Twitter / sportingintel: This list of 65 players bought by PL clubs for £20m+ (by @JakeFCohen) uses price-adjusted totals using RPI inflation pic.twitter.com/O99wzfQKUM

Bfj6fUaCIAAi0kD.jpg
 
Re: O/T Financial Fair Play

Probably sacrilege to say this here, but it's amazing that Arsenal are only in there twice, and one of those is Reyes.
 
Re: O/T Financial Fair Play

SWP29 said:
Probably sacrilege to say this here, but it's amazing that Arsenal are only in there twice, and one of those is Reyes.
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They pick up a lot of players towards the end of their contracts on lower fees but pay high wages.
 
Re: O/T Financial Fair Play

jts1882 said:
Isn't there a clause allowing clubs to exceed the limits as long as they are going in the right direction. So £98m to £52m is a substantial improvement which might allow them to pass the test.
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Provided that the deficit is reducing each year clubs can remove from their losses the wages they paid in 2011-12 for players whose contracts were already in place prior to 1 June 2010. Emirates Marketing Project would certainly fail FFP without this rule. They said last year that this amounted to £80m.

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Here is Ed Thompson's take on Emirates Marketing Project's recently released results from financialfairplay.co.uk:

Emirates Marketing Project'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 the first Monitoring Period. City have remained publically silent over whether they will actually pass the FFP Break Even test and curiously, the accounts don't even mention FFP or the potential for reduced income if they were to be excluded from future competition. Given that their thousands of fans are keen to know if the club have passed the FFP test, the club's silence seems remarkably remiss.

If UEFA's CFCB panel were to accept City's accounts on face-value and not contest any of the items, then it seems that City will just squeeze under the FFP limits (largely due to a transitional clause that allows them to exclude a huge chunk of wages paid in 2011/12 to players who originally joined the club before the FFP rules were voted-in).

However, the CFCB panel are required by the rules to review a number of transactions, totalling £35 m, which have been badged as 'Related Party Transactions' in the club accounts. The CFCB will attempt to identify and apportion a market rate to these transactions In addition, a number of other items could also conceivably be reviewed. These items:

•May be classified as Related Party Transactions by CFCB
•May not be considered 'Relevant Income' and will need to be excluded from the FFP Break Even test
As we know, City's accounts included a number of contentious items. These included payments to the club from the Emirates Marketing Project Women's team and the new New York City franchise. These payments have been justified on the grounds that the payment is for use of the club coaching and infrastructure, in addition to use of the City brand. The payment from the women's team is particularly interesting. The club set up a separate limited company for the women's team and although this team is almost certainly a loss-making enterprise, it has apparently paid the main club millions for the use of the City brand (plus use of infrastructure). As all the benefit from the City branding of the women's team will be received by City, it is difficult to see the commercial justification for this payment. With the New York City transaction, Emirates Marketing Project gain millions from this transaction despite the fact that the US franchise has yet to kick a ball.

The sale of Image Rights is both interesting and intriguing. The club has not disclosed precisely what they are trying to achieve. In their usual form, Image Rights are essentially a vehicle to avoid/reduce tax and National Insurance. For example a footballer will have a sum equal to up to 10% of their salary paid into an offshore company (often paying zero tax). The rationale is that, as a proportion of their earnings essentially come from use of their image overseas, there is no requirement to pay UK tax on the overseas earnings. HMRC cap this benefit at 10% of salary.

On the face of it, it looks like City are introducing a commercial company through which a percentage of their overseas earnings can channelled in order to reduce their tax liability. It looks like this company has paid Emirates Marketing Project for 'Image Rights' so that they can collect their designated overseas earnings. Presumably this company will ultimately process the revenue off-shore so tax is greatly reduced on any profits. However, Emirates Marketing Project have not made any profits for a number of years and as such have not had to pay Corporation Tax - any benefit from such an arrangement is therefore likely to come in future seasons. In an ideal world, the club should provide more information on what they are attempting here - it is possible that the club have simply sold a percentage of Image Rights to a completely separate company (as their Press Office seems to be suggesting). However, even if the rights revert to the main club after a defined period of time, this seems rather unlikely - why would City (a club with zero debt) genuinely want to sell a percentage of their future Image earnings? Depending on the rationale, it seems possible that CFCB may determine that the Image Rights payments do not represent 'Relevant Income' (a term that defines income generated from broadly football-related sources).

Emirates Marketing Project have every reason to feel pleased with the performance of their accounting teams. Whereas PSG decided to fudge the Break Even test with a single commercial tie-in with the Qatar Tourist Authority (a deal that appears to be a fairly transparent Related Party Transaction), City have very deliberately adopted a much more complex approach. The CFCB will have unpick a multitude of Related Party Transactions, deals with associated companies; third party companies; Image Rights deals; a complex Naming Rights and sponsorship/development deal, in addition to further sponsorship deals from parties connected (if not 'Related') to the owner. You have to wonder whether CFCB will have the desire and tenacity to unravel and challenge each element

City's increase in Commercial Income is also intriguing. Their non-Broadcast Commercial Income increased by a huge £36m (from £107m to £143m) and it is difficult to understand where this comes from. It is the convention for club websites and publications to list club partners/sponsors in order of their contribution to the club - City list their top sponsors/partners in order as Etihad, Nike, Etisalat, TCA Abu Dhabi and aabar. Four of their five top sponsors are from parties connected to the club owner (Mansour is part of UAE's absolute monarchy which effectively controls all government and all state-owned assets). The only non-Mansour-related partner in their top five appears to be Nike (who are reportedly paying £12m a season, a £6m increase from the previous season). The remaining key-partners were all sponsoring the club during 2012/13 and none are new. As I say, it is difficult to say where the £36m increase in commercial income has come from. The CFCB will presumably want to know and depending on the answer this might open up the debate of Related Party Transactions.

The suspicion arises that various Image Rights and intellectual property deals were essentially 'balancing items' and that these deals would have appeared in their accounts for however much City needed to nominally pass the test. Interestingly, Mancini was sacked just three-weeks before the end of the accounting cut-off date. His pay-off resulted in a one off charge in the club accounts for at least £7.5 m (quite possibly considerably more). City's accountants would have us believe that if the sacking had not happened, the club would have reported a very healthy and somewhat implausible FFP pass. One of City's 'Intellectual Rights' deals apparently included in their accounts (Melbourne Hart women's team) was only announced this month; this rather gives the game away.

So, what does this mean for City? The most likely scenario is that the CFCB will challenge most of the contentious items and that some will be overruled. City's FFP pass will be turned into an FFP failure. It seems likely that UEFA will use their newly beefed-up FFP sanction for City (and PSG) - see below for extract. This sanction enables UEFA to withhold players from their competitions based on their overspend. So, if for example, City are ruled to have failed FFP by £20m, the club will have to field a Champions League Squad without a number of players who are paid a total of £20 m in wages. The mechanics of this punishment are still be outlined but UEFA seems happy that this provides a punishment that is directly proportionate to a club's overspend. Unlike an outright ban, this punishment would insulate them from any later legal challenge and claim for damages (i.e. should FFP be eventually overturned via the Striani case).

Article 29 – List of disciplinary measures
1 The following disciplinary measures may be imposed against any defendant
other than an individual:
a) warning,
b) reprimand,
c) fine,
d) deduction of points,
e) withholding of revenues from a UEFA competition,
f) prohibition on registering new players in UEFA competitions,
g) restriction on the number of players that a club may register for participation
in UEFA competitions, including a financial limit on the overall aggregate cost
of the employee benefits expenses of players registered on the A-list for the
purposes of UEFA club competitions,
h) disqualification from competitions in progress and/or exclusion from future
competitions,
i) withdrawal of a title or award​

http://www.financialfairplay.co.uk/latest-news/man-city-release-controversial-accounts
 
Re: O/T Financial Fair Play

jaysea67 said:
Article 29 – List of disciplinary measures
1 The following disciplinary measures may be imposed against any defendant
other than an individual:
a) warning,
b) reprimand,
c) fine,
d) deduction of points,
e) withholding of revenues from a UEFA competition,
f) prohibition on registering new players in UEFA competitions,
g) restriction on the number of players that a club may register for participation
in UEFA competitions, including a financial limit on the overall aggregate cost
of the employee benefits expenses of players registered on the A-list for the
purposes of UEFA club competitions,
h) disqualification from competitions in progress and/or exclusion from future
competitions,
i) withdrawal of a title or award​
[/I]
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I'm sure we'll see plenty of a), a fair bit of b), some c), and none of the other punishments given to any major club. Measures d) to i) are reserved for the public spacegoats for all that is wrong with football, which will probably be some obscure Russian/Ukranian club and a few low level, underachieving, overspending clubs in Spain/England. Just to show how seriously UEFA takes financial doping.
 
Re: O/T Financial Fair Play

Uefa reveal 76 clubs, understood to include Chelsea, Emirates Marketing Project and PSG, are under investigation for possible Financial Fair Play breaches

Those that don't comply with the rules could face sanctions, with Uefa permitted to bar teams from European competitions

UEFA has revealed that 76 clubs in European competition this season - about one third of the total - are being investigated for possible breaches of its Financial Fair Play (FFP) rules.

The 76 clubs all failed UEFA's break-even calculations for 2012 and have been asked to provide financial information for 2013. Emirates Marketing Project, Chelsea and French club Paris St Germain are believed to be among the clubs involved.

The clubs will all now have their finances assessed by the Club Financial Control Body to see if the breaches have continued and whether sanctions should apply.

UEFA general secretary Gianni Infantino said: "This figure of 76 clubs is a high figure but it has to be looked at in the perspective of what the end figure will be."

Clubs face a range of sanctions from a warning or a fine up to being forced to play in Europe with a salary cap on the squad, or even being barred from competing and having trophies stripped.

http://www.independent.co.uk/sport/...ble-financial-fair-play-breaches-9161011.html
 
I would love it if UEFA actually put their foot down and both Chelski and City got banned from European competitions next season. I mean I doubt it would happen and if it did we would likely see a two horse race for the league with those two being free from the constraints of mid week journeys, but imagine the UCL with Arsenal, Liverpool, Everton and us next year with UTD, Southampton and Saudi Sportswashing Machine in the Europa league :D. Would make a nice change
 
UEFA need to tread carefully here, push to far and we might have a break away euro league on our hands
 
galeforce said:
UEFA need to tread carefully here, push to far and we might have a break away euro league on our hands
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Good. UEFA should kick them out of their domestic leagues and ban any player signing for those break away clubs from participating in any of their tournaments. Get FIFA in on it too, no more World Cups. Can't see the fans going along with a super league either. Where's the fun in playing the exact same teams every season? Promotions, relegations, going to new places, that's what keeps it interesting.
 
Cochise said:
I would love it if UEFA actually put their foot down and both Chelski and City got banned from European competitions next season. I mean I doubt it would happen and if it did we would likely see a two horse race for the league with those two being free from the constraints of mid week journeys, but imagine the UCL with Arsenal, Liverpool, Everton and us next year with UTD, Southampton and Saudi Sportswashing Machine in the Europa league :D. Would make a nice change
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Being banned from European competition is the ultimate sanction, there are a load of smaller punishments that will be used first.
 
Jordinho said:
Good. UEFA should kick them out of their domestic leagues and ban any player signing for those break away clubs from participating in any of their tournaments. Get FIFA in on it too, no more World Cups. Can't see the fans going along with a super league either. Where's the fun in playing the exact same teams every season? Promotions, relegations, going to new places, that's what keeps it interesting.
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I actually think we should get rid of UEFA & FIFA, really see no value in either at this stage, corrupt organizations that do little to further the game, put their own agenda against even basic player safety (our game going ahead in Ukraine being perfect example).

Local FA's can manage their own needs, with some kind of board with representation from each handling regional approaches.

If big clubs want to do a breakaway league, let them, let the fans decide what/who they want to support, in what format, by how they spend their money.
 
This might be bad news though. If it were one or two clubs then UEFA could make an example of them. But the owners of PSG, Chelski and City can surely just sue and challenge and appeal for loss of income etc until they wear UEFA down.

Was a nice idea , shame it was implemented by UEFA.
 
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