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Financial Fair Play

SWP29 said:
Let's not kid ourselves here, £50m isn't pocket lint for the Sheikh, Abramovich or even Jordan Belfort!
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Yes it is but then your trying to put your usual perverted spin on the cheating your club get up to due to your lack of personal ethics. Emirates Marketing Project brought there way to the title and into the top 4 by spending at massively high levels. Since the rule changes came in they carried on and have now been caught breaking the rules.

The money does not matter to them because in there own mission statement when taking over they wanted to make city one of the big teams in european football, to do this they need to win titles and compete in European competition, the anything thing that will stop them over spending is points deduction and bans from those competitions they aspire to be in.

If the owners of city spend a billion pounds on the club over 10 years it will be well spent because in 20 years time if they are one of the top teams in Europe they will be valued at a billion or over and as the oil runs out in their own countries they will have a commodity in another country in the sports sector which has seen massive growth over the last 15 years and will probably see the same growth over the next 15 years.

This 50m is a drop in the ocean to city and makes good financial sense for them in the long run. Your club and you are being used as a pawn in a rich man's folly.
 
Well, what about banning the admin heads and owners from attending CL matches?.

Not getting to sit alongside the great & the good at glory nights would dent their pride, especially when it keeps getting mentioned in the meeja with the obvious link to cheating.
 
clevelandspur said:
Sorry I don't see how fining Emirates Marketing Project and PSG is really a deterrent? After all they are spending this funny money to begin with, surely the Sheikh will just laugh off another 50m. Wake me up when they ban teams from competitions or give them a points deduction that's the only way anyone will take this seriosuly
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They are fining the clubs not the owners. The fine will have to go through the books which will mean that they are £50m down on their rivals when it comes to business in the next year. The punishments are on a sliding scale, so failure to comply next year will be dealt with more severely, with the ultimate sanction being expulsion from European competition.

The first hurdle that we need to get through is this round of punishments without a successful legal challenge. Once that has happened it will become embedded into the European game.

I can understand cynicism where UEFA is concerned but we all seem to agree that some form of financial fair play is needed. This has got further than many of us thought it would. I think that it will be interesting to see how it plays out and I hope that it is successful.
 
Superhudd said:
So for a major sugar daddy.. am I right in thinking they can buy Utd.. spend 500m on players with massive sign on fees to reduce wages to 80k a man, then enter the champions league the year after.. with no fines coming.
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I don't believe so.

I think UEFA use the generally accepted practice of writing down the value of a player over the length of their contract. I also believe that signing on fees are considered capital costs of a player.

So if you spent £50m on Gareth Barry (lol) and gave him a 4 year contract at £1m per year with a £10m signing on fee, you would have an accounting loss of £15m per year on the player and wage costs of £1m.

In year 2, if you sold James Milner for £20m (lol) then you would recognise that immediately, so for year 2 you would recognise a profit of £4m (assuming no other transactions and all other players fully written down).

If, in year 3 you offer Barry a new contract (lol) then the signing bonus would be capitalised and written off over the new contract.

So in your scenario, you'd have to wait until all the expensive players had their values written down and had signed new contracts before you could sneak in.
 
japenesegardenlover said:
Yes it is but then your trying to put your usual perverted spin on the cheating your club get up to due to your lack of personal ethics. Emirates Marketing Project brought there way to the title and into the top 4 by spending at massively high levels. Since the rule changes came in they carried on and have now been caught breaking the rules.

The money does not matter to them because in there own mission statement when taking over they wanted to make city one of the big teams in european football, to do this they need to win titles and compete in European competition, the anything thing that will stop them over spending is points deduction and bans from those competitions they aspire to be in.

If the owners of city spend a billion pounds on the club over 10 years it will be well spent because in 20 years time if they are one of the top teams in Europe they will be valued at a billion or over and as the oil runs out in their own countries they will have a commodity in another country in the sports sector which has seen massive growth over the last 15 years and will probably see the same growth over the next 15 years.

This 50m is a drop in the ocean to city and makes good financial sense for them in the long run. Your club and you are being used as a pawn in a rich man's folly.
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I've asked before but don't remember the answer; did you used to be Chichester on the old board?
 
SWP29 said:
I've asked before but don't remember the answer; did you used to be Chichester on the old board?
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No I was not but what is the relevance of that in regards what I wrote. I suspect instead of replying to the points made is because you know deep down how your club has behaved has been immoral which makes your continue support of them immoral in my opinion.

Were the same to happen at Tottenham and we were brought by a free spending billionaire we would have choice to make and I understand it would be a dilemma as we all want to see our team successful. But as when the mooted move to Stratford was talked about I would have been part of the group that would have formed and been a fan of FC Tottenham.

The fact that you stayed and supported City does not make you a bad person but it does show your attitude towards ethics especaily regarding money and rather debunks any opinions you have the subject as it smacks of self interest and one wonders whether your actually employed by City in some capacity such is your haste in always defending the indefensible.
 
milo said:
They are fining the clubs not the owners. The fine will have to go through the books which will mean that they are £50m down on their rivals when it comes to business in the next year. The punishments are on a sliding scale, so failure to comply next year will be dealt with more severely, with the ultimate sanction being expulsion from European competition.

The first hurdle that we need to get through is this round of punishments without a successful legal challenge. Once that has happened it will become embedded into the European game.

I can understand cynicism where UEFA is concerned but we all seem to agree that some form of financial fair play is needed. This has got further than many of us thought it would. I think that it will be interesting to see how it plays out and I hope that it is successful.
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I can't begin to know the complexity of FFP, so when you say they fine the club and it counts towards business how does that work? As far as I am aware there is no cap on how much a club can spend on players, so what stops the Sheikh from just going out and spending more money on top of the fine?
 
clevelandspur said:
I can't begin to know the complexity of FFP, so when you say they fine the club and it counts towards business how does that work? As far as I am aware there is no cap on how much a club can spend on players, so what stops the Sheikh from just going out and spending more money on top of the fine?
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Owners cannot just inject cash into the club any more. Clubs must be self sustaining. Unless the club has legitimate income to offset against the spend it will appear as a loss in their books and will be further in breach of FFP rules. City tried unsuccessfully to boost their numbers with sponsorship which was in effect the owners father trying to help the club. UEFA said no go on that sponsorship deal (or half of it) and that's where City find themselves now

Edit: I should have said that owners can spend their money on infrastructure and other things. Just not on players, wages, etc.
 
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scaramanga said:
I don't believe so.

I think UEFA use the generally accepted practice of writing down the value of a player over the length of their contract. I also believe that signing on fees are considered capital costs of a player.

So if you spent £50m on Gareth Barry (lol) and gave him a 4 year contract at £1m per year with a £10m signing on fee, you would have an accounting loss of £15m per year on the player and wage costs of £1m.

In year 2, if you sold James Milner for £20m (lol) then you would recognise that immediately, so for year 2 you would recognise a profit of £4m (assuming no other transactions and all other players fully written down).

If, in year 3 you offer Barry a new contract (lol) then the signing bonus would be capitalised and written off over the new contract.

So in your scenario, you'd have to wait until all the expensive players had their values written down and had signed new contracts before you could sneak in.
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So they could offer 6 month contracts then.
 
Rorschach said:
Owners cannot just inject cash into the club any more. Clubs must be self sustaining. Unless the club has legitimate income to offset against the spend it will appear as a loss in their books and will be further in breach of FFP rules. City tried unsuccessfully to boost their numbers with sponsorship which was in effect the owners father trying to help the club. UEFA said no go on that sponsorship deal (or half of it) and that's where City find themselves now

Edit: I should have said that owners can spend their money on infrastructure and other things. Just not on players, wages, etc.
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Ok thanks that explains it better than what I knew it as. Still seems there is plenty of gray area for clubs to get around this though.
 
clevelandspur said:
Ok thanks that explains it better than what I knew it as. Still seems there is plenty of gray area for clubs to get around this though.
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Not gray enough for City and PSG it appears.

Real are pulling a fast one too by selling their training ground to the city for 400mil. State aid by another means.
 
Superhudd said:
So they could offer 6 month contracts then.
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You could, but you need to submit 3 years of accounts, so you'd need to give 6 month contracts and then somehow keep a mercenary player who can now command a £20M+ signing on fee at any club in the world from leaving on a Bosman for 2.5 years.
 
japenesegardenlover said:
No I was not but what is the relevance of that in regards what I wrote. I suspect instead of replying to the points made is because you know deep down how your club has behaved has been immoral which makes your continue support of them immoral in my opinion.

Were the same to happen at Tottenham and we were brought by a free spending billionaire we would have choice to make and I understand it would be a dilemma as we all want to see our team successful. But as when the mooted move to Stratford was talked about I would have been part of the group that would have formed and been a fan of FC Tottenham.

The fact that you stayed and supported City does not make you a bad person but it does show your attitude towards ethics especaily regarding money and rather debunks any opinions you have the subject as it smacks of self interest and one wonders whether your actually employed by City in some capacity such is your haste in always defending the indefensible.
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Will reply to this tomorrow. Just want to say that I have never said that I am against FFP, I'm for a way to curb our spending. It is and always has been excessive.
 
japenesegardenlover said:
No I was not but what is the relevance of that in regards what I wrote. I suspect instead of replying to the points made is because you know deep down how your club has behaved has been immoral which makes your continue support of them immoral in my opinion.

Were the same to happen at Tottenham and we were brought by a free spending billionaire we would have choice to make and I understand it would be a dilemma as we all want to see our team successful. But as when the mooted move to Stratford was talked about I would have been part of the group that would have formed and been a fan of FC Tottenham.

The fact that you stayed and supported City does not make you a bad person but it does show your attitude towards ethics especaily regarding money and rather debunks any opinions you have the subject as it smacks of self interest and one wonders whether your actually employed by City in some capacity such is your haste in always defending the indefensible.
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I think it is interesting that you mention morals in your argument. I have a different view of the likes of Sheikh Mansoor and Abramovich. Yes they have used their money to buy success but then at least they spend on the team in order to win trophies so the fans of those clubs ultimately benefit. Not sure if I deplore them more than the likes of Stan Kroenke who take the fans money by charging exorbitant ticket prices, sell off their best players, chase massive sponsorship deals all to line their own pockets. They only care about finishing 4th so the money keeps rolling in while never re -investing that money. These clubs have no soul imo. That is why I have so much time for Daniel Levy, he is ambitious while trying to keep the club on a sustainable footing.
 
Rorschach said:
Not gray enough for City and PSG it appears.

Real are pulling a fast one too by selling their training ground to the city for 400mil. State aid by another means.
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They are being investigated by the EU for that.

They along with Barca and athletico bilbao (i think) are also being investigated by the eu for some tax set up which saves them a few mil a year. Apparently they are the only 3 clubs in Spain left with that structure now.
 
Emirates Marketing Project have finally agreed to accept their much leaked punishment for failing FFP...


http://www.telegraph.co.uk/sport/football/teams/manchester-city/10837079/Manchester-City-accept-world-record-50m-fine-for-breach-of-Uefa-Financial-Fair-Play-rules.html

Emirates Marketing Project accept world-record £50m fine for breach of Uefa Financial Fair Play rules

The new Premier League champions ended their fight against the biggest financial penalty ever imposed on a sports team – and a cut in their Champions League squad for next season to 21 players – by agreeing a ‘settlement’ offer with European football’s Club Financial Control Body.

Announced more than a month after The Daily Telegraph first revealed they were set to fail Uefa’s FFP test, the deal ended a tense stand-off between City and the CFCB’s investigatory chamber over the sanction they should face for failing to comply with rules aimed at combating “greed, reckless spending and financial insanity”.

The Manchester club threatened to fight to the bitter end to avoid their penalty by taking their case to the CFCB’s adjudicatory chamber and beyond.

They were granted multiple extensions to the deadline for settling their case before eventually backing down, allowing Uefa to announce all nine clubs found guilty of FFP breaches had settled with the investigatory chamber.

As well as City and Paris St Germain, they are Zenit St Petersburg, Rubin Kazan, Anzhi Makhachkala, Galatasaray, Trabzonspor, Bursaspor and Levski Sofia.

The clubs all exceeded the losses of £37.2 million permitted by Uefa in their 2011-13 accounts after various deductions.

The CFCB’s decision on City’s punishment, reached by chief investigator Jean-Luc Dehaene before his death on Thursday, included several caveats which could see City avoid paying two-thirds of their fine if they comply.

To achieve this, the club must report a maximum break-even deficit of £16.2 million in 2014 and £8.1 million in 2015. They must also avoid increasing “employee benefit expenses – essentially wages – during 2015 and 2016, although that sanction could be lifted for the final year.

The European squad size reduction from 25 to 21 players – eight of whom must be homegrown – will be imposed for two seasons if they fail to comply with their annual break-even target.

As part of their settlement, City agreed to “significantly limit spending in the transfer market for seasons 2014/2015 and 2015/2016”.

The CFCB confirmed City’s fine would be levied by the withholding of any revenues it earns in Uefa competitions from next season.

The CFCB said in a statement: “The compliance with the Settlement Agreement will be subject to on-going and in depth monitoring, in accordance with the applicable rules. In this connection, Emirates Marketing Project also undertakes to provide the CFCB with a Progress Report evidencing its compliance with all relevant conditions agreed on a six monthly basis.

“In case Emirates Marketing Project fails to comply with any of the terms of this Agreement, the UEFA CFCB Chief Investigator shall refer the case to the Adjudicatory Chamber, as foreseen in Art. 15 (4) of the Procedural Rules.”

City’s settlement may not be the end of what has proven a tortuous process. Any party affected by the sanction has 10 days to appeal, with Arsenal and Everton possible beneficiaries of any successful challenge.
 
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