UEFA puts the brakes on reckless club spending
Nyon: European soccer’s governing body UEFA applied the brakes to reckless club spending on Thursday by approving rules aimed at forcing clubs to live within their means.
Under UEFA president Michel Platini’s “Financial Fair Play” plan, clubs will not be able to spend more than they generate through revenues while cash injections from rich benefactors will be severely restricted.
Those who fail to comply could ultimately be barred from entering European competition.
“The new financial fair play regulations were finally approved unanimously,” UEFA general secretary Gianni Infantino told reporters after an executive committee meeting.
“The main rule is the break-even requirement which will be phased in over the next three years.
“It is not as easy to swallow for everyone but everyone understands it is necessary.
“They are there not to punish clubs, they are there to help clubs. We don’t want to kill anyone, this is why we have a phased-in approach.”
If successful, the plan -- which does not apply to domestic leagues and was approved in principle last September -- could have a huge impact on European club football as it will effectively force clubs to slash salaries and transfer fees to keep their expenditure within limits.
The rules are also aimed at ending the trend of rich owners buying into the game and transforming the fortunes of a club, as happened with Chelsea and more recently Manchester City in the English Premier League.
This has a knock-on effect as other clubs stretch their finances in order to try and keep up.
Clubs will be allowed some leeway as money invested in stadiums and youth development will not count when auditing their accounts, UEFA said.
“Clubs could spend an unlimited an amount of money on those things but when it comes to salaries and transfer fees they have to manage their cost structure in a much more prudent way,” said Andrea Traverso, head of club licensing at UEFA.
Clubs will also be allowed to run up a deficit of 5 million euros over three seasons and may receive cash injections of 45 million euros for the period comprising the 2013/14 and 2014/15 seasons together. This will be reduced to 30 million euros for the period covering 2015/16, 2016/17 and 2017/18.
However, they will not be permitted to owe any money to other clubs, employees or tax and social service authorities at the end of the season.
Earlier this year, Infantino said 50 percent of European clubs were running at a loss with 20 percent showing serious deficits.
He said clubs could still spend large amounts on transfer fees if they had enough revenue.
“If clubs want to spend 50, 60 or 70 million (euros), why not, provided they have the money coming from their revenues, this will continue in the future,” he said.
“The problem is when you don’t have the money.”
The European Clubs’ Association (ECA) said it welcomed the plan.
“This is really a huge achievement,” ECA president Karl-Heinz Rummenigge said in a statement. “The measures will shape the future of European football into a more responsible business and ultimately a more sustainable one.”
UEFA said the system would be phased in and the first time a club could be theoretically banned is 2014/15.
More from India
More from World
More from Sports
More from Entertaiment
- Watch - IIT-Kharagpur develops superpower drone 'BHIM' that could aid soldiers in war zones
- Anti-Romeo squad launched: Has moral policing started in UP?
- Jharkhand: Congress leader, 3 others killed in shootout in Dhanbad
- CM Yogi’s cleanliness drive: UP cops clean up police stations
- Do not put unnecessary pressure on police: PM Modi tells UP BJP MPs
- Hukumdev Narain Yadav to be new Vice-President of India?
- 400 Trinamool Congress members including many TMC stalwarts join BJP in Tripura
- Bhagat Singh, Sukhdev, Rajguru were hanged on 23 March 1931 – This is how PM Modi paid tribute today
- Kapil Sharma fight on flight row: Did Sunil Grover, Ali Asgar and Chandan Prabhakar skip shoot?
- Mohammad Kaif welcomes Yogi Adityanath's appointment as new Uttar Pradesh chief minister