Spotlight on Financial Fair Play in Football: Uefa forced to defend FFP’s independence

 
Frank Dalleres
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EUROPEAN football’s governing body Uefa was forced into a PR offensive yesterday after their president Michel Platini appeared to state that no clubs would be banned for breaking new financial fair play (FFP) rules.

The suggestion raised significant questions about Uefa’s willingness to get tough on serious offenders, and what influence, if any, Platini might wield over decisions that are meant to be made by an independent panel.

It also looked like good news for Manchester City, who are one of the clubs believed to be most at risk of sanctions for exceeding Uefa’s permitted limit of a £38m loss over two years.

Uefa moved quickly to emphasise that Platini had not said “there will be no exclusions from European competitions” but had instead said “I believe there will be no exclusions”.

The governing body also reaffirmed the independent nature of its Club Financial Control Body (CFCB), which is supposed to investigate and decide on punishments for offending clubs at arm’s length from Uefa.

Uefa has fought hard to stress the credibility of its FFP drive and specifies in its regulations that expulsion from the Champions League and Europa League is an option, yet scepticism remains in some circles as to how much appetite Uefa has for punishing its biggest clubs.

City are believed to be at risk having lost a combined £149m over the two-year monitoring period, from 2011-13. Certain costs, such as spending on facilities, can be deducted but they are expected to face a battle to come in under £38m, despite the club’s confidence of passing FFP.

French champions Paris Saint-Germain are also thought to face sanctions. PSG have spent vast sums on world stars since their Qatari takeover in 2011, and a commercial deal with the country’s tourism body worth £570m over four years is being seen as a test of Uefa’s muscle on related-party transactions.

“I think significant sanctions will hit the big clubs. We are going to take this to the end,” said Platini, who called PSG’s deal “innovative”. He added: “Does PSG respect financial fair play rules? Not sure, not at all sure. Let’s just say that the economic model of PSG is unique and not normal.”

Uefa is due to deliver its first FFP decisions next month, and the CFCB is thought to have contacted clubs in breach to discuss possible settlements. If clubs accept they face lesser sanctions, though rival clubs who miss out on Europe as a result may challenge.

City A.M. is hosting a roundtable discussion on financial fair play in conjunction with BT Sport on May in the City. Those interested in obtaining a ticket should email jennifer.rimmer@cityam.com

SPECTRUM OF SANCTIONS FOR FFP BREACHES

1 Clubs guilty of the most minor breaches face a warning

2 The CFCB can issue a reprimand for slightly more serious offences

3 Teams could be fined for exceeding Uefa’s limit of £38m losses

4 Moderately serious breaches could incur a points deduction

5 Uefa can withhold prize money and TV cash from its competitions

6 Clubs can be banned from registering new players for Euro matches

7Uefa can limit a club’s Euro squad, either by number or wage cost

8 A ban from European competition is the second hardest sanction

9 In extreme cases clubs could be stripped of titles

EXPERT VIEWS

I’m not surprised that he’d make that statement. I always believed it was going to be a softly-softly approach, trying to get clubs to work with them rather than against them. That’s not to say Uefa aren’t going to issue sanctions against some clubs who have transgressed and we won’t know until we’ve seen some of those settlements start to appear as to how hard they’re going to be. But I would have thought the early settlements will be a learning process for everybody as to how they are going to apply the rules and interpret certain well documented transactions.

There may be clubs who disapprove of what he has said. Of course there are provisions in the rules for a directly affected party to challenge, and it remains to be seen how those that have complied and are outside the European places are going to view the, if you like, leniency of Uefa. We just don’t know how.

It does seem a little strange [for Platini to pre-empt the decisions], or maybe it’s a policy decision they’ve discussed. This is the first time they’ve looked at it so maybe it’s been a policy decision that they won’t levy the ultimate sanction. Maybe he feels confident enough in what he has heard that nobody is at that end [of the scale].

TREVOR BIRCH
PARTNER AND FOOTBALL INDUSTRY EXPERT, BDO

Uefa has stated that the Club Financial Control Body is the body that will make the sanctioning decisions, not Mr Platini. It therefore seems unusual for him to make such statements bearing in mind he is not supposed to have any influence over the way sanctions are imposed.

Expulsion is an explicit power that has been given to the CFCB to sanction clubs in breach. It doesn't mean they have to use it but some may feel there are circumstances where the break-even breach is so large that a ban would be deemed appropriate.

DANIEL GEEY
ASSOCIATE AND SPECIALIST IN FOOTBALL LAW, FIELD FISHER WATERHOUSE