Anti FFP action starts legal challenge

[ratcatcher]

Financial Fair Play under threat: Brussels court case could potentially lead to rules being scrapped

 

 

Manchester City are among the clubs that would like to see the rule scrapped

Ian Herbert

 

Wednesday 25 February 2015

     

         

 

 

Manchester City’s hopes that Financial Fair Play (FFP) might be ruled illegal rest on a potentially hugely significant court case which opens in Brussels on Thursday.

 

The challenge to Uefa’s regime – which City fell foul of last year – has been brought by football agent Daniel Striani, and supporters of both City and Paris Saint-Germain, and will be heard over the next two days at the Court of First Instance in the Belgian capital.

 

Striani and the fans are being represented by Jean-Louis Dupont, one of the lawyers who secured the landmark Bosman ruling 20 years ago, with Dupont preparing to argue that FFP infringes competition law and should therefore be declared illegal.

 

European football’s governing body, Uefa – which will have its own legal representation in court – insists it has support for FFP from the European Commission, which in October decided not to investigate Striani’s case further. Legal opinion suggests that it may be more than a year before the case is resolved.

 

The case of Karen Murphy, the Portsmouth landlady who took on the Premier League, underlines how drawn out decisions can be. Ms Murphy went to court to fight for her right to use satellite decoders to show live football intended for transmission abroad.

 

The legal argument in the Striani case is that the break-even requirement of FFP is in breach of article 101.2 of the EU Treaty. This article prohibits cartels and other agreements that could disrupt free competition and, therefore, have an impact on consumer protection.

 

[Neil G]

Really hope something comes of this. FFP as it stands is a fucking joke, nothing fair about it at all. If it's strictly implemented its effect will be to freeze the existing order in place forever.

 

I don't want FFP scrapped altogether though, just reformed to allow some owner investment. I'd like to see it rewritten as follows:

 

- Club owners allowed to invest their own funds in the playing squad, up to a certain limit per season, either as injection of equity or as an interest-free loan.

 

- Loan repayments not to exceed a certain percentage of the club's turnover.

 

- A limit on the total player wage bill (an actual figure rather than a percentage of clubs' turnover).

 

Revising the rules this way would allow ambitious clubs to move up the pecking order and break into the elite. It wouldn't just benefit Abramovich-type owners who want to splash their own cash, it would also benefit commercially minded owners like FSG who see investing in the squad as a requirement to increase the club's revenue in the longer term. At the same time the transfer spend and wage caps would prevent super-rich clubs running away with things with unlimited spending, and the loan repayment provision would stop clubs getting into unaffordable debt - the liability would be on the parent company rather than the club.

[Cardie]

It wouldn't.

 

 

 

 

[Section_31]

Football will just keep consuming until nobody gives a fuck then the money men will move on to something else.

[Anubis]

They're on to a long term winner because I can't think of another sport that unites the planet like football, and each successive generation of supporters becomes accustomed to the excesses.

[AngryOfTuebrook]

"Manchester City are among the clubs that would like to see the rule scrapped"

 

Pas de poo, Poirot.

[Neil G]

It wouldn't.

What wouldn't what, and why not?

[SlugTrail]

Really hope something comes of this. FFP as it stands is a fucking joke, nothing fair about it at all. If it's strictly implemented its effect will be to freeze the existing order in place forever.

 

I don't want FFP scrapped altogether though, just reformed to allow some owner investment. I'd like to see it rewritten as follows:

 

- Club owners allowed to invest their own funds in the playing squad, up to a certain limit per season, either as injection of equity or as an interest-free loan.

 

- Loan repayments not to exceed a certain percentage of the club's turnover.

 

- A limit on the total player wage bill (an actual figure rather than a percentage of clubs' turnover).

 

Revising the rules this way would allow ambitious clubs to move up the pecking order and break into the elite. It wouldn't just benefit Abramovich-type owners who want to splash their own cash, it would also benefit commercially minded owners like FSG who see investing in the squad as a requirement to increase the club's revenue in the longer term. At the same time the transfer spend and wage caps would prevent super-rich clubs running away with things with unlimited spending, and the loan repayment provision would stop clubs getting into unaffordable debt - the liability would be on the parent company rather than the club.

The problem is neil that if this case wins then any restriction that is imposed will be contested and most likely overturned, so re-writing the rules will not be worth the paper that they are printed on.

[Lee909]

The only teams who i can see wanting rid are Chelsea,City, Barca,Real and possibly Man U and Bayern. If this gets scraped then Bayern could probably get the German league rules dropped and be allowed to spend more and not worry about breaking even

[Neil G]

Football will just keep consuming until nobody gives a fuck then the money men will move on to something else.

 

They're on to a long term winner because I can't think of another sport that unites the planet like football, and each successive generation of supporters becomes accustomed to the excesses.

Anubis is right. We've been hearing comments like Section's for the last ten years at least, but people keep paying up and the money keeps rolling in to the game in record amounts.

 

The only thing that will stop the juggernaut is if we have another global economic crash worse than the last one. But football itself won't be its own undoing.

[Chairman Meow]

I don't see it being an issue for Bayern. Aren't they massively financially stable? Surely a strict FFP rule would actually benefit them.

[Lee909]

If the rules were scrapped they could dpend more as they wouldn't have to break even. I dont think they would be the main team pushing fir it to go

[Jose Jones]

Barca and Madrid shouldn't have too many problems either.

Basically FFP will fuck up the nouveau riches the most, Man City and PSG and the like.

 

Chelsea have managed to get into a bit of a position where they manage by buying loads of players then sell them on for profit, so might be OK for a while, but they'll be constrained if things go tits up and Abramovic wants to spunk £200 million on a couple of players.

 

You've already seen Monaco and PSG stop their spending and Man City have slowed down somewhat too.

[Neil G]

The problem is neil that if this case wins then any restriction that is imposed will be contested and most likely overturned, so re-writing the rules will not be worth the paper that they are printed on.

Not necessarily. Rules that are successfully challenged in court often end up being revised rather than scrapped.

 

The basis for the case is EU competition law, which is supposed to prevent situations where a few companies become dominant and the rest are unable to challenge that dominance. If FFP were abolished altogether then chances are that a few super-rich oil clubs would have an unassailable dominant position. So it's not certain or even likely that the EU Court would pass a judgment that made this happen.

[Babb'sBurstNad]

Really hope something comes of this. FFP as it stands is a fucking joke, nothing fair about it at all. If it's strictly implemented its effect will be to freeze the existing order in place forever.

 

I don't want FFP scrapped altogether though, just reformed to allow some owner investment. I'd like to see it rewritten as follows:

 

- Club owners allowed to invest their own funds in the playing squad, up to a certain limit per season, either as injection of equity or as an interest-free loan.

 

- Loan repayments not to exceed a certain percentage of the club's turnover.

 

- A limit on the total player wage bill (an actual figure rather than a percentage of clubs' turnover).

 

Revising the rules this way would allow ambitious clubs to move up the pecking order and break into the elite. It wouldn't just benefit Abramovich-type owners who want to splash their own cash, it would also benefit commercially minded owners like FSG who see investing in the squad as a requirement to increase the club's revenue in the longer term. At the same time the transfer spend and wage caps would prevent super-rich clubs running away with things with unlimited spending, and the loan repayment provision would stop clubs getting into unaffordable debt - the liability would be on the parent company rather than the club.

 

The problem is he's moving to have it scrapped.

 

As for freezing the order, I can't see how your mooted amendments wouldn't do exactly that too. The wage cap would never get past the courts. And limiting investment to interest free loans or injection of capital means almost no owners would look to speculate, which would only serve to solidify the order even more.

 

The problem with FFP is that it locks in the order of clubs into a basic framework where gradual improvement over a decade or more is needed. The problem with any other system is that it just leads to a place where a club spends a penny and City / PSG / Chelsea spend a tenner. 

 

If club owners were allowed to invest a certain sum each year no matter what, Abramovich would invest the maximum, and the gap would widen. Any relaxation of the rule which you think might help us, would only serve to deter the kind of ownership we currently have, as they'd inevitably blink first in the face of such financial might.

[Section_31]

Anubis is right. We've been hearing comments like Section's for the last ten years at least, but people keep paying up and the money keeps rolling in to the game in record amounts.

 

The only thing that will stop the juggernaut is if we have another global economic crash worse than the last one. But football itself won't be its own undoing.

 

I think football in England is in unprecedented territory in terms of the financial dominance of a few clubs and the over saturation of televised football. 

 

Football is about hope, the idea that no matter how shit you are that things could be better next season.

 

But the more people realise that, even if you build a decent side it's going to be broken up by city/chelsea/barca/madrid you get to the stage where people wonder what the point is. 

 

In the past money may has permeated the game and made it hard for people to afford to attend, but it's still sold itself on the lie that football was still competitive, when growing numbers of people realise it's not, they'll turn off. 

 

I think it will be interesting to see what happens to CL viewing figures once it's lost from terrestrial TV too, I doubt many people are going to traipse to the pub to watch Arsenal vs Genk. Again, another example of short term profit eroding the game's long term appeal. 

[Cardie]

What wouldn't what, and why not?

Ignoring the fact that your reforms of FFP seem to centre around making FSG give us money, most of the changes won't have the impact you seem to think they will.

 

A fixed monetary cap on wages as opposed to a percentage of turnover would never be set at a level low enough to have an impact on the top teams because the disparity is too high for them to find a middle ground, it could only ever be set at the higher end of the scale to be inclusive for all.

 

Likewise allowing club owners to invest more maintains the status quo for clubs who have owners who can afford that but drives a further divide between those can't.

 

Also you'd never be able to pass your separation of club and owner idea in a million years.

 

 

 

 

[Cardie]

The problem is he's moving to have it scrapped.

 

As for freezing the order, I can't see how your mooted amendments wouldn't do exactly that too. The wage cap would never get past the courts. And limiting investment to interest free loans or injection of capital means almost no owners would look to speculate, which would only serve to solidify the order even more.

 

The problem with FFP is that it locks in the order of clubs into a basic framework where gradual improvement over a decade or more is needed. The problem with any other system is that it just leads to a place where a club spends a penny and City / PSG / Chelsea spend a tenner.

 

If club owners were allowed to invest a certain sum each year no matter what, Abramovich would invest the maximum, and the gap would widen. Any relaxation of the rule which you think might help us, would only serve to deter the kind of ownership we currently have, as they'd inevitably blink first in the face of such financial might.

in one.

 

The only thing that would have an impact on big clubs is expulsion from competitions based on failure to satisfy FFP rules.

 

 

[Guest Numero Veinticinco]

It wouldn't.

 

Agree

[Gym Beglin]

Another good reason to leave the EU?

 

FFP, however ham-fisted, does at least try to give smaller clubs a fighting chance.

 

Personally, I back a European Elite League.  In that league there would be no need for FFP, everyone can spend the trillions generated by tv revenue.  Sky can then have it all.

 

Meanwhile, a Premier League can continue in a slightly less razzmatazz format and even the likes of the BBC or ITV could have a go at securing rights to some live games.

 

People used to mock Scotland for the 'two team league', but it's increasingly becoming a common theme across all major leagues now where the super-rich just shit on everyone else in every major european league.

 

Elite League could be selected by those clubs that make an annual turnover of more than £x million per year, and those clubs that finish first and second in their respective national league.

[ratcatcher]

Really hope something comes of this. FFP as it stands is a fucking joke, nothing fair about it at all. If it's strictly implemented its effect will be to freeze the existing order in place forever.

 

I don't want FFP scrapped altogether though, just reformed to allow some owner investment. I'd like to see it rewritten as follows:

 

- Club owners allowed to invest their own funds in the playing squad, up to a certain limit per season, either as injection of equity or as an interest-free loan.

 

- Loan repayments not to exceed a certain percentage of the club's turnover.

 

- A limit on the total player wage bill (an actual figure rather than a percentage of clubs' turnover).

 

Revising the rules this way would allow ambitious clubs to move up the pecking order and break into the elite. It wouldn't just benefit Abramovich-type owners who want to splash their own cash, it would also benefit commercially minded owners like FSG who see investing in the squad as a requirement to increase the club's revenue in the longer term. At the same time the transfer spend and wage caps would prevent super-rich clubs running away with things with unlimited spending, and the loan repayment provision would stop clubs getting into unaffordable debt - the liability would be on the parent company rather than the club.

 

I dont know how you square this circle about you personally not wanting a mega rich owner in situ and not having some form of FFP in place.

 

Where do you think Liverpool FC will be if FFP does get chucked out?

 

There's no mega rich owner waiting in the wings to ride to the rescue and suddenly start pumping large amounts of cash into the club.

 

I'll tell you where the club will be, it'll be at the top of the rank of clubs like stoke, southampton, west ham and newcastle never to be in the top 4 again.

[kalasoma]

At the bottom of this Telegraph story

http://www.telegraph.co.uk/sport/football/managers/jose-mourinho/11435712/Chelsea-manager-Jose-Mourinho-angers-BT-paymasters.html

 

D-day for Hull and Liverpool

 

It was a year ago this week that it first became clear Manchester City were in serious trouble over Uefa’s Financial Fair Play regulations. Twelve months on and it is the turn of Liverpool and Hull City to sweat over the outcome of a meeting of Uefa’s Club Financial Control Body.

Both clubs are expected to learn tomorrow whether they face further investigation over their 2011-14 accounts, having avoided scrutiny last year due to being outside European competitions.

 

Like City, each could face fines or have prize money withheld if found to have overspent while qualifying for the Champions League and Europa League.

 

[Pureblood]

Soccernomics? Yawn.

[magicrat]

I don't see how you can legally prevent rich owners form sinking their own cash into a business if it is injected as equity capital and not just some form of leveraged loan. Bonkers

[aws]

Maybe we should bring a case arguing that preventing clubs striking their own TV deals is anti-competitive.