UEFA Financial Fair Play Rules Huge Test For Top English Clubs


UEFA President Michel Platini today warned Europe’s top football clubs, that they will have to abide by the new UEFA Financial Fair Play rules, due to take effect next season, or face the consequences.

Michel Platini – new rules go into effect next season in Europe

UEFA’s latest financial figures on European clubs, not surprisingly, show that financial problems affecting European clubs are getting worse rather than better, with spending on player wages up almost 10% – and increasing at a much faster rate than revenues coming in.

Under the new UEFA rules, clubs will face bans from European competition, beginning in the 2014-2015 season,  if they spend more than their revenues in the three preceding years.

In short, and in simple financial terminology, the clubs are being forced to balance their books – and it’s about time too.

Manchester City’s recent £121M loss, which they reported as good – what a joke – means that the richest club in the world are facing the greatest difficulties to abide by the new rules.

That’s because all of their money for transfers and the like is coming from the owner, and is not being generated by revenues of the club, in terms of gate receipts, TV revenues, strip sales, and the like – hence the huge loss being reported.

UEFA President Platini said the European governing body would not hesitate to take action when necessary, whichever club failed to abide by the new rules.

Speaking at UEFA’s headquarters in Nyon, Switzerland today, this is what Michel Platini said:

“If a club doesn’t fall in line and follow the same rules as everyone else then it will be time to face the music.”

“Certainly it is not something we want to see. Our objective is not to put clubs into financial difficulty.”

“Financial fair play is to help them escape from this devilish spiral and have a viable economic strategy in the long term.”

“This is not a witch-hunt, this is so they no longer continue blindly and mindlessly.”

“Last year in Abu Dhabi I met up with the owner of Manchester City, and he promised they would live with the new rules and regulations.”

UEFA’s General Secretary Gianni Infantino admitted that most of the new rules, that go into affect starting next season,  are aimed specifically at keeping the amount of money spent on the club wage bills to manageable proportions.

In some clubs in England,  the wages right now are more than 100% of the revenues, which is simply ridiculous and financial suicide.

That means clubs in England are paying out wages to their players, which exceed all revenues coming into the club, and that’s one reason why Mike Ashley is being extra careful in the new wages he is paying out to players getting new contracts at the Newcastle club.

General Secretary Infantino said.

“It is about better cost management, in particular the wages of players – it is an indirect salary cap,”

UEFA allocated a whole day to explain the system to the global media, and Infantino pointed to Arsenal as an example of a well-run club, who have increased their income without ever overspending like a lot of other English clubs.

And unfortunately, at the same time, he implicitly contrasted it to Newcastle United, who have hardly been well run financially, since 2000 – sorry Freddy:

Infantino continued:

“Ten years ago, Arsenal reported less income than Chelsea, Liverpool and Newcastle. Now it is more than those clubs and in 2009 was more than double Newcastle’s.”

“This shows what is possible with good management and careful investment.”

“What kind of healthy business model is it to wait for a knight rider on a horse with a lot of money to throw around and then one day jump back on his horse and ride away?”

The news is that Manchester City have already sent some of their executives to meet UEFA officials about complying with the new Financial Fair Play rules.

Andrea Traverso, UEFA’s head of licensing, said:

“We are in talks with the club – they are aware of the rules and they probably have a strategy to raise their income.”

“They have been to see us and they are confident that they can manage this challenge.”

Under the new system, UEFA will  start to put clubs who are not meeting the new rules into a special category, and the various warning signs include:

  • Recording a loss in the financial year
  • Spending more than 70% of  the revenue on wages alone
  • Not being able to pay  football-related payments or taxes on time
  • Having a level of debt higher than the annual revenue (called  turnover in England)

With these new warning signs, both Chelsea and the  Manchester clubs, would be put into  the special category of clubs being monitored.

The European Clubs’ Association (ECA), which had Newcastle United as one of the five clubs representing England, before we were relegated two years ago, have thrown their full support behind the new Financial Fair Play rules.

It’s almost a joke that UEFA have been forced to do this, and that football clubs, especially in England, have continued to spend way over what they bring in in revenues.

We can only assume that the financial people in charge of  most of the top English clubs have never read Charles Dickens’ book David Copperfield, in which Mr. Micawber gives the very sound advice:

“Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness.”

“Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery”

It seems that Platini and the new UEFA rules could make it quite miserable for some top English clubs, if they don’t get their financial act together.

It’s also good that Newcastle are trying to follow the Arsenal model, as the London club have been branded as one of the best run clubs in Europe, although most people in football already knew that.

Newcastle have also to  become as successful as Arsenal have been over these last 10 years, that’s the hard part.

Comments welcome.



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57 comments so far

  • ToonIreland

    Jan 11, 2011 at 11:12 PM

    Comment #1

    maybe … just maybe, Ashley is doing the right thing with our club from a financial point of view at least

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  • JP...from The Rock

    Jan 11, 2011 at 11:13 PM

    Comment #2

    We’re going on about it the right way. Although I do feel we could widen our scope to find the best upcoming talent out there. Not too many youngsters been snapped up for trials n stuff lately. Apart from that french kid that’s gone missing I haven’t heard much. We should be bringing kids in on a regular basis. Who knows we could even land us our very own Messi. If you don’t look you wont find shit.

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  • kevymartins

    Jan 11, 2011 at 11:27 PM

    Comment #3

    JP agreed

    and yven moyo the french kid is still with us..

    yea carr is the head scout but so fu k we should have scouts all over the world looking an we could be bringing ronaldo’s in every week for all we know

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  • GeordieGerman

    Jan 11, 2011 at 11:33 PM

    Comment #4

    I bet from next year there are two rules. One for the top four and one for the rest. I mean we can’t let fairness get in the way of Manure, Citeh Chelsea and so on.

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  • thevoiceofreason

    Jan 11, 2011 at 11:39 PM

    Comment #5

    Pity Arsenal fall foul of the other rule Platini is bringing in on naturalised players. They have to bring them in early otherwise they would not be able to play in this country in the next few years. Not going to see that many of the England squad playing for Arsenal are you! Also this does not stop the Chelsea’s or Man Cities of this world. The point is revenue! If I charge another company that I own for services, I get revenue! For instance if I sell the rights for TV coverage of Chelsea games in the middle east at some stupid rate, this money would be revenue for Chelsea. It makes it more difficult to plough money into a club, but not impossible. That’s what accountants are for. This rule stops the likes of what happened at Leeds but that’s about it! Example for our own part it is like getting revenue for billboards outside the ground, or branding the stadium sportsdirect@. Let’s hope that deal is redone for a few million hey!

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  • GeordieGerman

    Jan 11, 2011 at 11:52 PM

    Comment #6

    thevoiceofreason, That’s a question I have been struggling with for a while now. Is Ashley paying for all his advertising. I mean, if it was another firm that would be revenue. If he’s using all this space and not paying then we are losing income and Ashley would be ripping the club off.

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  • baro

    Jan 11, 2011 at 11:57 PM

    Comment #7

    That is the reason why we should of kept Dennis Wise. He brought Samuel Adjei, Haris Vuckic, and some other top youngsters in our academy. We used to get some of those top youngsters but after Wise left the only one we have brought in is Yven Moyo

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  • kevymartins

    Jan 12, 2011 at 12:04 AM

    Comment #8

    kept dennis wise…someone please come and shoot me…

    after i system restored i cannon give thumbs up and down anyone know why?

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  • BlacknWhite Barmy

    Jan 12, 2011 at 12:04 AM

    Comment #9

    OK lets look at Citeh

    Owner puts one season ticket for sale at 500M – not surpsising no takers other than the owne – sorted – books balanced (479M profit) – why do fifa try to ruin our game??

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  • newcastle29

    Jan 12, 2011 at 12:13 AM

    Comment #10

    French press reporting that we are close to signing ziani!

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  • GeordieGerman

    Jan 12, 2011 at 12:21 AM

    Comment #12

    kevymartins, Hey true. I’ve just noticed it’s missing. Not your PC’s fault.

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  • willowdalerez

    Jan 12, 2011 at 12:22 AM

    Comment #13

    Will be interesting to see if and whether they enforce it… as per some of the other posts on here “Teams” of accountants/lawyers will be all too willing to sell their specialized services to help owners who wish to find loopholes create them and I doubt there will even be the “will” to enforce against the worst offenders as these franchises also just happen to be the EPLs most widely branded from a Global perspective…

    Can’t risk pissing of the all important casual Chinese/SE Asian/N.A./Latin American etc. markets as this might affect the sales of matter of Merchandise and broadcasting/TV rights sales and they might never come back b/c these casual EPL viewers want their stars and their top 4 and so they will get them otherwise horror of horrors they might follow another league or homegrown sport.

    Prediction – Lots of noise & no enforcement the Russian mob, exiled Thai PMs and Arab Oil Kings get to spend to their hearts delight but better shielded by Magic Circle Law Firms and top Accounting Firms!

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  • baro

    Jan 12, 2011 at 12:38 AM

    Comment #14

    I really hope we sign Karim Ziani. From what we have right now at right wing i would really be happy to sign anybody. Wayne Routledge is just too inconsistent. Out of 10 games he will have 1-2 good games. As for Ziani he is a great passer and can terrorize defenses, and is very strong agressive player. Something we really need.

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  • kevymartins

    Jan 12, 2011 at 12:44 AM

    Comment #15

    I dnt care about it..cuz we have a great fan base..

    This could be great for us…cud result in us with a epl title after a few years 😉 😉

    like chelsea are doomed as stamford bridge has a small capacity.

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  • kevymartins

    Jan 12, 2011 at 12:47 AM

    Comment #16

    baro we have joey barton on right wing who is playing the best football of his life

    i say foo k ziani an keep bart’s out there on the touch line

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  • baro

    Jan 12, 2011 at 12:53 AM

    Comment #17

    kevymartins

    Ya I know Barton is brilliant on the right but Tiote is out for next 3 matches. We put Nolan at Center Mid with who??

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  • kevymartins

    Jan 12, 2011 at 12:57 AM

    Comment #18

    guthrie, dan gosling, vukic,smith

    personaly i would put willo in cb and play collo in DM as he can play there

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  • baro

    Jan 12, 2011 at 12:58 AM

    Comment #19

    If you really want to loose than why not give Smith and Guthrie a shot at it. Haris Vuckic is a great player but is injured at the moment. Gosling tbh I don’t know how he plays yet. Some say he is a RB, others say CM, RM.

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  • baro

    Jan 12, 2011 at 1:01 AM

    Comment #20

    kevymartins is this what you want?

    :::::::::::::::::::::::::::::::Harper:::::::::::::::::::::::::::::::::

    Gosling:::::::Willo:::::::::::::::::::Taylor::::::Enrique

    ::::::::::::::::::::::::::::::::::Colo::::::::::::::::::::::::::::::::::

    Barton::::::::::::::::::::::Nolan::::::::::::::::::::::::Jonas

    :::::::::::::::::::::Ameobi::::::::Carroll::::::::::::::::::::::

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  • Toonarmy1993

    Jan 12, 2011 at 1:04 AM

    Comment #21

    following arsenal’s plan is sensible, but they quoted that in 2009-10 arsenal made double the profit of newcastle united, hardly suprising as we were in the championship and got little tv money, need to sort there facts out..

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  • kevymartins

    Jan 12, 2011 at 1:06 AM

    Comment #22

    no what barro your right he would be a great signing cuz hes a great player..maby i just afread of putting bartoon in cm an him playing sh it an going of form..

    i just wanta see some1 in asap..witch won’t happn cuz pardrew talks bull to the press an i h8 it

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  • baro

    Jan 12, 2011 at 1:06 AM

    Comment #23

    For the Mackems I’d do this

    :::::::::::::::::::::::::::::::Harper::::::::::::::::::::::::::::::::

    Simmo:::::::Willo:::::::::::::::::::Taylor::::::Enrique

    ::::::::::::::::::::::::::::::::::Colo:::::::::::::::::::::::::::::::::

    Barton:::::::::Gosling::::::::::::Nolan:::::::Ferguson

    ::::::::::::::::::::::::::::::::Carroll:::::::::::::::::::::::::::::::

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  • toonruz

    Jan 12, 2011 at 1:08 AM

    Comment #24

    talks are going to continue with larson agent 2moro deal could still be completed

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  • kevymartins

    Jan 12, 2011 at 1:09 AM

    Comment #25

    _________Harper_________
    simpson___saylor___collo__the bull

    ziani____bartoon__________jonas

    ______best______nolan__
    _________carroll_________________
    look’s good to me

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  • kevymartins

    Jan 12, 2011 at 1:12 AM

    Comment #26

    Toonruz.. and how do you know this??

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  • CT

    Jan 12, 2011 at 1:12 AM

    Comment #27

    I give up now on this site!!
    Being saying this for at least last 12 months, Platini`s austerity plan= more level playing field!!
    Outgoings cannot exceed EARNED income!!
    So doesn`t matter if you got the richest guy in the universe, any money invested in the club will need to be either turned into share capital or written off as a bad debt!!

    That`s how a proper business operates, this gives us a chance— Turnover/ Overheads= Profit!!

    ASH/ DELL may yet prove sound!

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  • JP...from The Rock

    Jan 12, 2011 at 1:27 AM

    Comment #28

    As we have a bigger fan base than most teams in Europe / World we will have more capital than most. With die hard fans out there like many of us on this blog we will continue to buy merchandise like the new strip when it’s out etc. (as long as it’s not puke yellow again!)

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  • JP...from The Rock

    Jan 12, 2011 at 1:28 AM

    Comment #29

    This new rule will in fact suit us in the long run. If we keep on grabbing youngsters and turn them into stars and fans just keep on spending we will have a nice transfer kitty available 🙂

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  • slazberger

    Jan 12, 2011 at 1:29 AM

    Comment #30

    CT – like people said earlier though. the abramovic’s of this world will find a loop hole such as adding a sponsorship deal worth x amount of millions, there putting the money in anyway to keep the club afloat all they have to do is make it an official contract.

    this isnt just a problem with english clubs either, i seem to remember barca and real madrid announcing huge losses last year.

    still prefer the way arsenal appear to do it. lets face it these people could get bored and if they dont they cant live forever, and where will those clubs be then?

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  • coolcatcarter89

    Jan 12, 2011 at 1:36 AM

    Comment #31

    Just wondering how many false rumours, ‘decoy signings’ and other assorted rhubarb I’m going to awake to tomorrow?

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  • technonasty

    Jan 12, 2011 at 1:42 AM

    Comment #32

    with regards to Gosling. I’ve seen him play a few times for Everton on the right side of midfield. This was prior to any rumours of him signing for us and he seemed like a really tidy player. Always available and lots of quick passes. I think he will probably end up in CM and be very good at it…

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  • Toonmania

    Jan 12, 2011 at 6:44 AM

    Comment #33

    Scumberlands biggest signing lmao!!!

    [IMG]http://i556.photobucket.com/albums/ss8/saabmania2/article-1346271-0CB8D524000005DC-495_468x534.jpg[/IMG]

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  • carrollsinger

    Jan 12, 2011 at 7:00 AM

    Comment #34

    All these big clubs have to to is clear there dept as it’s coming from there pocket ad they will bedeor free

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  • bosamuelson

    Jan 12, 2011 at 7:46 AM

    Comment #35
  • Rotonda heights

    Jan 12, 2011 at 8:12 AM

    Comment #36

    It’s a shame Wise couldn’t have just stuck at getting the youngsters in: Ranger, Spear, Adjei, Vuksic et c etc.

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  • roe997

    Jan 12, 2011 at 8:15 AM

    Comment #37

    craig coozey any news?

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  • NUFC_Richyg01

    Jan 12, 2011 at 9:18 AM

    Comment #38

    This new ruling is in our favour, and I think that Ca$hley has been looking at this ruling coming in for a while and thats why he is doing what he is doing, he is a business man, and businessmen want their businesses to look after theirselves financially.

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  • NUFC_Richyg01

    Jan 12, 2011 at 9:20 AM

    Comment #39

    Nice to see that we have put a £6m price tag on Bartons’ head which has killed off Villa’s attention.

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  • NUFC_Richyg01

    Jan 12, 2011 at 9:22 AM

    Comment #40

    I see this in the news this morning:

    “Tottenham have agreed a deal in principle to sign Everton midfielder Steven Pienaar, having seen off competition from Inter Milan and Atletico Madrid.”

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