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What new Financial Fair Play regulations mean for PSG & the rest of the elite

Following its implementation seven years ago, financial fair play has been effective according to UEFA, seeing as it drastically decreased European clubs’ debts. In 2009, that number was as high as €1.7bn and has since decreased to €269m. However, according to L’Équipe, the European football body has decided to implement five additional regulations to successfully deal with the bad eggs of European football. These rules must be validated by Wednesday in Lyon by UEFA’s Strategy Council, and by the executive committee in Kiev on May 24.

1 | Transfer balance examination

This first measure stems from PSG’s last transfer window and their astronomical spending (222 million euros for Neymar from FC Barcelona and 145 million + 35 million in bonuses for Mbappé from Monaco). Next season, any club whose balance stands at 100 million euros or more, between their player purchases and sales, will have to provide immediate guarantees. The UEFA Club Financial Control Body has already began looking into PSG. They have the possibility, for example, to force the sale of a player this summer. Strangely enough, because PSG made all their purchases last summer and because they will be affected by the Financial Control Body’s measures, PSG isn’t really affected by this specific rule.

2 | Well-regulated player sales

This second measure stems from Manchester City, a club who is primary shareholder in Girona FC (Spain), Melbourne City FC (Australia), New York City FC, the Yokohama Marinos (Japan) and Club Atletico Torque (Uruguay). Starting this summer, just before the World Cup begins at the beginning of June, during which you can use this for if you fancy a flutter on the action, when two clubs with the same shareholder complete a transfer, it will immediately be reviewed to see if the cost was over or under evaluated. The idea is to prevent other clubs from misleadingly balancing their books by paying absurd sums for transfers as adjustment variables.

3 | Clubs’ books made public

In France, this has been in place for years. The DNCG publishes an annual report with detailed information on Ligue 1 and Ligue 2 clubs’ books. But it is not implemented across Europe yet. From this point forward, all teams playing in European competitions must be completely transparent with their books at the risk of facing the Club Financial Control Body.

4 | Transparency for agents’ commissions

Since being elected to head of UEFA, Aleksander Ceferin has made limiting agents’ commissions, one of his priorities. In the meantime, he has worked so that these astronomical commissions (Paul Pogba, Neymar etc.) for some cases are brought to light. From now on, clubs must clearly state who they have worked with in their accounting documents and paperwork. We could be in for quite a few surprises and revelations!

5 | Keeping an eye on clubs’ debts

Up until now, the experts of UEFA’s Club Financial Control Body made efforts to enforce the main principle of FFP, that clubs playing in European competitions could not exceed the €30m during these last three seasons. For the 2018-2019 season, their debts will be directly observed and cannot exceed a certain amount vis-à-vis their revenue. The idea is to avoid evasion and risks of bankruptcy.

 

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