Abstract
The aim of this article is to set out the rationale for the new UEFA Financial Fair Play Rules (FFPRs), examine what the provisions state and offer a conclusion about their significance. The article will illustrate that there are a number of criteria and exceptions which clubs can use to their advantage. There will also be an explanation regarding the amortisation of transfer fees and how such accounting practices will affect clubs wishing to break-even in order to qualify for UEFA club competitions.
Highlights
Background The Basics AcceptableDeviation = Breakeven(ish) Amortisation One Early Loophole An Outline Competition Law Assessment: Are the FFPRs Anticompetitive? Related Party Transactions Chelsea's January 2011 Transfer Window Spending Sanctions Consequences for Clubs and ConclusionThe UEFA Financial Fair Play Rules: a difficult balancing act Daniel Geey, Solicitor, Field Fisher Waterhouse LLP* ABSTRACTThe aim of this article is to set out the rationale for the new UEFA Financial Fair Play Rules (FFPRs), examine what the provisions state and offer a conclusion about their significance
When taking into account Chelsea’s spending on youth development and 52 infrastructure, which can be deducted as a cost from the FFPRs, wage reductions from high earners like Carvalho, Ballack, Deco and Cole who all left the club, profits on transfers and deductions on Annex XI wages for contracts entered into pre-June 2010, it starts to become apparent that it may well be possible for Chelsea to make a ‘standard’ accounting loss in the few years but still receive a UEFA license to participate in the Champions League. (For a more in-depth assessment of where Chelsea may commercialise their revenues further to break-even see http://swissramble.blogspot.com/2011/02/chelseas-financial-fair-playchallenge.html?utm_source=BP_recent.)
The flip side to this is that if clubs do not wish to play in UEFA competitions, they can spend whatever they want, provided that there are no domestic FFPRs in place
Summary
Background The Basics Acceptable Deviation = Breakeven(ish) Amortisation One Early Loophole An Outline Competition Law Assessment: Are the FFPRs Anticompetitive? Related Party Transactions Chelsea's January 2011 Transfer Window Spending Sanctions Consequences for Clubs and Conclusion. The UEFA Financial Fair Play Rules: a difficult balancing act Daniel Geey, Solicitor, Field Fisher Waterhouse LLP*
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