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UEFA – There will be new Financial Fair Play | Playon99 News

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It is almost a fact that the new Financial Fair Play will be approved and the club-states that have been so successful in recent years are trembling. PSG and Newcastle will have limitations in a measure that greatly favors the big clubs that are already established and wanted a Super League.

By Facundo Di Bona (@facudibona).

UEFA has almost approved the new Economic Control and the ECA (European Club Association). And the leagues have given their approval to Aleksander Ceferin’s new Financial Fair Play. This comes close to one of the demands made of him: to tighten the regulations so as not to give an advantage to the club-states.

Over the last decade, several of the big clubs and big leagues have criticized UEFA for allowing teams like PSG and Manchester City to spend regardless of financial losses.

They were seen as financially inflated teams. Therefore at a disadvantage and imbalance to the other clubs, but it seems that UEFA intends to end this situation and will limit both losses and capital contributions.

This is a very similar rule to the one currently in force in Spain’s La Liga, which is considered to be one of the most stringent for clubs to be solvent, although it also invites us to cover up what we already know about that tournament: how uneven it is between Real Madrid, Barcelona and -perhaps- Atlético Madrid with the rest of the teams.

UEFA’s reform aims at financial sustainability and “responsibility” in European soccer through solvency, stability and cost control requirements.

This reform responds to one of the main criticisms of the Superliga, which reproached UEFA for the permissiveness of its regulations towards club-states.

The regulatory reform seems to be more solid and strict towards these clubs, as well as towards European clubs as a whole.

One of the new rules will be in the obtaining of the UEFA License: the clubs’ net worth will be looked at, which must be positive at December 31 of the previous season or have improved by 10% compared to December 31 of the previous year.

There are also new developments regarding overdue debts with clubs, employees and public administrations: the reference date is postponed to February 28, thus allowing the control of January and February debts once the winter market is over.

Clubs must be up to date with all amounts due by March 31 and the concept of employees is extended to include all professional players and staff -whether employment or commercial- administrative, technical, medical and security personnel required by the UEFA License, as well as the obligation to be up to date with payments to the Licensor and UEFA.

Regarding the rule governing the sustainability of clubs -formerly known as Financial Fair Play- the Football Earnings Rule is established.

This rule is calculated as Relevant Revenues minus Relevant Expenses and must be positive -or within an acceptable deviation of €5M- for the monitoring period of three seasons.

It is also allowed to cover the deficit -additional to the €5M- with €60M in this three-season period, while currently up to €30M is allowed.

It must be covered with capital contributions or equity. In addition, this €60M over 3 seasons can be increased by an additional €10M per season.

There will be a salary cap

The salary cap is calculated as the sum of personnel expenses, depreciation, impairment and intermediation expenses.

It must be less than 70% of revenues: operating revenues + results from transfers and disposals.

The concept of operating revenues includes box office and season tickets, sponsorship and advertising, retransmission, commercialization, solidarity and UEFA market pool, and other operating revenues.

Expenses and revenues are calculated using the amounts for the 12 months prior to December 31 of the season in which the club participates in the relevant UEFA competition.

The result from transfers is calculated as net accounting profit or loss and the result from other operations includes income and expenses from player transfers.

The average of the last three years up to December 31 of the season prior to the season of the club’s participation in the relevant UEFA competition is calculated.

It includes all professional male players registered with the club or on loan to another club and the head coach, while personnel expenses are calculated gross, including all tax and social security costs.

This new regulation, although approved by the ECA, has not pleased its president, Nasser Al Khelaifi, as it affects PSG: the Parisians had been one of the beneficiaries of the still existing Economic Control much laxer and that did not control so much the losses.

Although there was speculation that this revision of the rule would be even more relaxed as a nod from Ceferin to Al Khelaifi for having rejected the Super League, but it is quite the opposite: it fulfills one of the complaints of the Super League clubs, which was to tighten the Financial Fair Play and puts an end to the club-state by limiting losses and capital contributions.

There is a greater requirement to comply with overdue debts and all transactions must be valued at market value.

The Football Earnings Rule measures the balance of results, supplemented by capital contributions in a limited and reasonable manner, while the control of the cost of the playing staff is limited to 70% of revenues.

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