UEFA’s Financial Fair Play – The Usual Suspects Have Their Say

UEFA’s Financial Fair Play – The Usual Suspects Have Their Say

By on Jun 8, 2010 in English League Football, Finance, Latest | 3 comments

It was predictable, but depressing nonetheless. UEFA’s new rules on finances for clubs entering their competitions have garnered the usual barbs from the usual mix of free-marketeers, journalistic free-loaders, xenophobes in general, Francophobes in particular and people who just hate UEFA president Michel Platini. It would be nice – challenging, even – if there was more than the faintest evidence that any of these people had understood the rules, or even read them, and based their opposition on that understanding.

I’m cynical enough not to expect a rounded debate. But the mixture of arrogance and ignorance which characterises the opposition still takes me aback. All of a sudden, everyone’s Martin Samuel. And that’s not good. The regulations are designed to prevent clubs from spending more than they earn – spending money they don’t have.  Common sense in its purest form.

The focus of the less-loony opposition is on what they don’t “achieve.” The idea that the regulations will create a “level playing-field” across European club football is dismissed. Indeed, criticism centres on the notion that the current “playing-field”- less level than Wembley – will be entrenched, “for the next 200 years, starting in 2012,” according to Samuel’s detailed scientific analysis in his Daily Mail newspaper column. There is some logic to this (not Samuel’s contribution, don’t be daft). The clubs, via the European Club Association, lobbied successfully for the regulations to be delayed to allow them a chance to adjust their financial situation, ostensibly to avoid falling foul of the regulations straight away.

This, the opposition maintains, will allow, say, Manchester City to spend, spend, spend until 2012, (£300m, according to Samuel’s detailed economic analysis) grab their Champions League place and have the vital advantage in turnover when the regulations take effect. City’s owner Sheikh Mansour and Chelsea’s Roman Abramovich were among the more high-profile lobbyists for stricter financial regulations, and it wouldn’t be stretching things to believe that they did so to shut the proverbial door behind them.

The regulations will not produce a “level playing field.” But no-one at UEFA is suggesting they will. Unless European club football is to start from scratch, with all professional clubs on the same budget, in the same-size grounds with the same-size ticket prices, “inequalities” will remain. The city of Manchester will remain bigger than the city of Stoke. Villa Park will always be bigger than Craven Cottage. UEFA’s very own Champions League will always be inequality generator number one until it too is reformed. Financial fair play is no more going to offer a cure for cancer than a levelling of those, literal, playing fields.

Another strand of opposition with a strand of logic attached is the perceived inability of Fulham to reach a Europa League final under the new rules. They have done so, the opposition suggest, as much because owner Mohamed Fayed has loaned them £200m as anything that Roy Hodgson or Bobby Zamora have achieved. But under the new regulations, there is nothing to stop Fayed bankrolling Fulham to the Premier League in the way that he did. And nothing in the regulations to stop him using his millions to at least double Fulham’s gate receipts by getting them to a 40,000-capacity stadium, thereby putting the Europa League back in reach.

There are obstacles to that plan, of course. And what chance would Fulham have of Champions League qualification then? But financial fair play regulations don’t add to current obstacles, or put in place any new ones. And what chance do Fulham have of Champions League qualification now? Alarmingly, Oliver Kay in the Times newspaper appears to suggest that a top-flight club going under is a price worth paying for a middle-ranking club having middle-ranking European success: “Under financial fair play, there would be no repeat of the Portsmouth situation,” he acknowledges, “but nor would there be the kind of fairytale enjoyed by Fulham’s supporters this season as they reached the Europa League final.” This is Kay’s argument against the regulations, suggesting that both outcomes should continue to be allowed. Outside certain parts of Southampton, I can’t believe there’s any widespread support for that.

Fans, probably correctly, assume that the first thing rich owners such as Abramovich will do is find a way to circumvent the rules. “Creative accountants will be much in demand,” noted one, darkly. But those second-guessing rich owners’ methods had clearly neither read the regulations, nor read any detailed explanations of them. The former is understandable. Even on Uefa’s own website, the regulations are hard to find. The only insight I had came from the Times newspaper’s posting of March’s draft regulations. The latter appears, on the part of some journos, to be strategic amnesia. A favoured “loophole” is the sponsorship route, e.g. Abramovich sponsoring Chelsea’s shoelaces for £50m quid a year. “Is there anything in the new rules that will stop (this)?” asks one fan on the BBC website, before adding, pertinently, “Nothing I’ve read suggests that he couldn’t.” The short answer to his/her question is “yes.” The regulations require clubs to establish in considerable detail that such sponsorship arrangements would represent “fair value” in the normal run of things.

The ultimate arbiter of “fair value” is the “UEFA club financial control panel.” The panel is tasked with making a-million-and-one such judgements and will be run by former Belgian prime minister Jean-Luc Dehaene – a genuine football fan who’ll doubtless be a faceless Brussels bureaucrat after Samuel gets to work on him. Whether £50m is a “fair value” to put on a football team’s shoelaces will be one of their easier judgements. And you suspect they’ll be well prepared if, as another fan suggested, Sheikh Mansour can circumvent the regulations by “gifting an oilfield to Manchester City” (and presumably not leaving BP to run it…). None of this made the newspaper columns with the most views to offer on the regulations.

Some readers also suggest that the regulations would constitute a restraint of trade. But reckless overspending… sorry… the “benefactor business model” is not being outlawed outright. UEFA are simply saying that they will not invite clubs in breach of the regulations to take part in their tournaments. Unless a court can decide it has the power to set UEFA’s admission criteria for their own competitions, the “restraint of trade” argument seems unpersuasive, although it might take a complex test case to demonstrate this. The main problem with the regulations, however, is less complex. Platini, who apparently wrote every word, is a self-important hypocrite and a French idiot. And that’s just in the Times, where he “has such a depth of knowledge without the need for evidence.” This could be supreme irony, but probably isn’t.

Kay’s tone invites such comments. Platini “surveys the European Football landscape” from “the shores of Lake Geneva, or the VIP area at one of the game’s cathedrals in Manchester, Madrid or Milan.” “He sees inequality all around,” we are informed, led by the nose to view him as a fat-cat beneficiary of said inequality. And just in case we still haven’t got the point, “he sees clubs living as extravagantly as the French aristocracy under Louis XVI.” “Any measure that protects football clubs from their worst excesses is to be applauded,” Kay acknowledges. Yet he steadfastly refuses to do so. But Martin Samuel and his readership are the masters. Samuel launches into his tired theories about the regulations targeting the Premier League – as if there’s some sort of “Valencia exemption clause” in there that the rest of Europe appears to have missed.

Everton, apparently, are victims who are “mired in mid-table.” They need “to invest in success before receiving any financial return.” What Everton “need to invest” in, of course, is a new stadium, hence the fuss over the move to Kirkby – which Samuel appears to have overlooked. That investment isn’t outlawed by the new regulations – which Samuel appears to have overlooked. “No wonder Abramovich is such a fan of Platini’s law,” he continues. “It stops a potential rival mimicking his method. Now he is the right side of it, he wants the glass ceiling double-glazed and re-inforced.” Chelsea posted losses of £47m last year. That figure, someway below any glass ceiling, is outlawed by the new regulations – which Samuel appears to have overlooked.

But, fearful of being outdone by his fellow xeno- and Francophobes, Samuel adds a twist, linking the award of the 2016 European Championships to France in with the new regulations. “This is how it ties together,” he explains. “French football gets a total government-financed refit just as UEFA is introducing strict financial controls.” How this makes these “strict financial controls” wrong isn’t made clear. Samuel’s stock defence of the Premier League doesn’t usually stretch beyond “but the (insert relevant foreigners here) are doing it too.” And this tying together of “financial – ahem – fair play” and Euro 2016 is very much in that column. The regulations are wrong because Platini has fixed the Euro 2016 vote, is what Samuel is trying to say, without giving the Mail’s lawyers the willies. After all, “it will be the third major tournament France has hosted in 32 years.”

By comparison, if England are awarded the 2018 World Cup, it will be their third major tournament in 52 years. And in those 52 years, France have been awarded… er… three… – which Samuel appears etc… “Only a fool could not see through them,” Samuel concludes of Platini’s plans to “cement all the richest, biggest clubs in Europe into the top league positions for the next 200 years,” something that could never happen at present. And Samuel’s readers are no fools, especially the one who informed us: “It is well-known by all fair-minded people that FIFA have a distinct desire to undermine the Premiership. They, particularly Mr. Seb himself, despise the domination of English clubs in the Champions League, it is uncanny how English teams are drawn together year-after-year. The financial restraints will eventually undermine the strength and development of the Premiership and eventually again lead to the formation of a European League for the elite, leaving the remnants for the home leagues.”

It is, admittedly, some achievement to get so much wrong in so few words, even before you get to the actual argument. But this is the standard of so much of the opposition to the basic notion that football clubs should only spend what they earn. “Such a depth of knowledge without the need for evidence” indeed. Thoroughly predictable. And thoroughly depressing.

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    3 Comments

  1. If only there was a conspiracy to undermine the Premiership. This Englishman would wholeheartedly support such a move by having a life-sized cardboard cutout of prime-era Platini located in his front room. May the filthy edifice collapse under the rising tide of it’s own debt.

    And Samuel is an absolute cretin.

    George

    June 9, 2010

  2. Excellent article, Mark. I hugely enjoy your thoroughly researched, insightful blog.

    If your readers would like further analysis of the implications of UEFA’s Financial Fair Play regulations, maybe I could point them towards my own review. It’s a bit of an epic and includes some technical jargon, but it was written after ploughing through all 62 pages of the draft proposal (which is almost certainly more than Martin Samuel has done):

    http://swissramble.blogspot.com/2010/05/uefa-say-fair-play-to-arsenal.html

    Swiss Rambler

    June 10, 2010

  3. Hasn’t Samuel found a way to pin all this on Sheffield United yet? He must be slipping. Hopefully, off a cliff somewhere.

    Mick

    June 11, 2010

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