Sport financial expert on SSN ref FFP

[john@staustell]

Just watched them interview this chappie live from the Gherkin in London, cant remember his name. He said when people looked at City (and moaned) they were looking at figures from last year and the year before. Because he expects a massive explosion in revenues, plus a reduction in transfer fees and squad size/wages, he would be 'very surprised' if Manchester City did not meet the FFP regulations as they are now.

He actually named City, United, Arsenal and Spuds but did not include Chelsea in the 'meet them easily' category. I suspect this was just an oversight as they weren't mentioned separately.

[Niall Quinns Discopants]

The fact that there are people in media who think that we haven't got competent enough staff to fully investigate and understand Financial Fair Play Rules kind of just tells what kind of jokers pass as journalists.

[Im_Spartacus]

Fully agree with both posts.........

Chelsea managed to boost their revenues to in excess of 200m within a couple of years of cl qualification and winning the premier league. In addition the following are all likely to change substantially which have not yet appeared in our accounts.

Champions league prize money and tv rights
Premier league tv rights for live games
Etihad sponsorship
Nike / umbro sponsorship (not sure if we get any extra....as pl champions we should though surely)
Reduction in wage bill
No need for carrington
Likelihood of a couple of decent young players coming through as squad players initially. On much reduced wages to the stars
Likelihood of selling on a few of the current crop younger players who wont quite make it but are solid players

[Ted Hughes]

That goal of Aguero's will be worth scores of millions in the short term & billions long term.

Half the world was celebrating & the number of kids who've just become City fans will be astronomical.

[Swales4ever]

I find ms in agreement all previous posts, which exploit pretty every points of the issue.
I reckon the current year will be mainly influenced by a huge increase on tv rights (including a fat slice from overseas) and increased gates revenue, with a notable but lesser figure from wages cut.
But the most important point for the future is the one stressed by Ted (and pointed out by Khaldoon himself): the geometrical increase on marketing and tv rights that will result from the PL title. That's also why the Rags sent out all their weapons (media and black jackets) in the desperate attempt to stop City from becoming Champion of england.

[john68]

I think it is important to remember two things.
1)...Being disqualified from UeFA's competitions is a "LAST RESORT" sanction against clubs.
2)...Clubs do NOT have to meet the required targets but have to show significant evidence of improvement towards meeting the targets.

After the initial announcement,when pushed on penalties and how they would sanction or action them against the big clubs, UeFA have continuously backtracked.
A meeting in Manchester last year of major sports lawyers, which was attended by many of the large European clubs, advised that UeFA would have difficulty enforcing sanctions. It advised that UeFA would not wish to be forced to defend their rules in a court.

City's figures as announced by Deloitte over the last few years, give us cause for optimism.
2008-09.....E101.2M
2009-10.....E152.8M. Contains the income from City playing in the UeFA Cup. (+E51.6M)
2010-11.....E169.6M. No European qualification. A good indicator of City's basic income.

None of those figures show any income from this season's CL and Europa Cup competition, the increased TV revenues and increased revenue from finishing 3rd in the League. Nor do they include any revenue from the Etihad Campus sponsorship.
Winning the League will also greatly benefit us in marketing the club globally as English Champions. A further increase in TV money and finishing position payments from the Premier League.

Without knowing what figures we may be dealing with, there is plenty of evidence to show that even if we don't meet the UeFA break even point, we can show a massive improvement in our income and attempting to meet them.

[carl_feedthegoat]

It has been mentioned that us winning the prem will generate 230 million this year alone !

Imagine all the youngsters who have no real club to support watching that drama !! we will have just gained thousands of wannabe fans (its inevitable)...we are growing at an enormous rate.

[john68]

Last night I spoke at length to a sports lawyer whose company was the one who hosts the Footbball/legal conferebce annually in Manchester. They also represent City and do work for Newcastle.

He told me that UeFA regulations were actually based on Swiss law, as they were based in Lausanne. He said that they also had to comply with European law.
In answer to an issue raised here, "that the UeFA was a private body and could therefore set whatever criteria they wished", he told me that: "Because there was no other competition and clubs had no other option of playing in European competition, UeFA had a monopoly on competition and had to comply with monopoly laws and not abuse their position of monopoly".

The fear that UeFA had, was losing any legal challenge and sued due to the huge amounts of money involved and the amounts they might be forced to pay out.

It is certainly a more optimistic view than we have heard from the threats issued by UeFA and the media. Whatever Taggart may shout about for his rag audience.

[Ted Hughes]

Last night I spoke at length to a sports lawyer whose company was the one who hosts the Footbball/legal conferebce annually in Manchester. They also represent City and do work for Newcastle.

He told me that UeFA regulations were actually based on Swiss law, as they were based in Lausanne. He said that they also had to comply with European law.
In answer to an issue raised here, "that the UeFA was a private body and could therefore set whatever criteria they wished", he told me that: "Because there was no other competition and clubs had no other option of playing in European competition, UeFA had a monopoly on competition and had to comply with monopoly laws and not abuse their position of monopoly".

The fear that UeFA had, was losing any legal challenge and sued due to the huge amounts of money involved and the amounts they might be forced to pay out.

It is certainly a more optimistic view than we have heard from the threats issued by UeFA and the media. Whatever Taggart may shout about for his rag audience.

This is how I thought it would pan out.

I recon we will play lip service to it & try to become self sufficient as soon as we can, but without damaging our progression, then if they try to single us out; the shit will hit the fan.

[Lev Bronstein]

The thing that gets me - although I'm no lawyer - is that surely FFP is against European competition laws. After all, if ADUG wanted to spend 1 or 10 billion on building a new car factory in the UK the existing car firms would be told where to get off if if they tried to stop them.

If UEFA wanted to clean out football's stable they could put a ban on unsustainable debt, arguing that a club going out of business would undermine the whole structure of any league.

[Swales4ever]

Last night I spoke at length to a sports lawyer whose company was the one who hosts the Footbball/legal conferebce annually in Manchester. They also represent City and do work for Newcastle.

He told me that UeFA regulations were actually based on Swiss law, as they were based in Lausanne. He said that they also had to comply with European law.
In answer to an issue raised here, "that the UeFA was a private body and could therefore set whatever criteria they wished", he told me that: "Because there was no other competition and clubs had no other option of playing in European competition, UeFA had a monopoly on competition and had to comply with monopoly laws and not abuse their position of monopoly".

The fear that UeFA had, was losing any legal challenge and sued due to the huge amounts of money involved and the amounts they might be forced to pay out.

It is certainly a more optimistic view than we have heard from the threats issued by UeFA and the media. Whatever Taggart may shout about for his rag audience.

This is how I thought it would pan out.

I recon we will play lip service to it & try to become self sufficient as soon as we can, but without damaging our progression, then if they try to single us out; the shit will hit the fan.

I wouldn't be so pragmatic. the legal point raised by Sir John is a very solid one and I'd tend to suppose that would be the second stance well before to hit the fanbase. a little beat of the bushes should be enough: I don't think that there might actually any football politician who would like to cross legal swords with a Club with suck quality of advice.

[Socrates]

Problem is that UEFA have set financial rules for qualification for years so precedent is on their side. Cannot remotely imagine the European Court getting involved as long as the rules are set and applied fairly across all countries they will have no interest.

[Dameerto]

You just have to look at the pattern of transfer spending by the bigger clubs in the Prem around the time the rules were introduced - there was a definite lull for one season presumably while the clubs had their legal departments go through the rules with a fine tooth comb, then it was back to spending as normal. Pretty much EVERY club with European ambitions did the same thing. That tells me the clubs in the Prem don't see the rules as a barrier to spending in general.

[Swales4ever]

Problem is that UEFA have set financial rules for qualification for years so precedent is on their side. Cannot remotely imagine the European Court getting involved as long as the rules are set and applied fairly across all countries they will have no interest.

I disagree Pal:
a) re. the setting of financial rules for qualification: see point 2 of Sir John early post above. no need to full compliance. next financial statement shall certainly record a significant loss reduction to the previous one.
b) re. European Court unlikelihood of involvement: if anything that Court has always been extremely comprehensive and jelous of anything involving the idea itself of MONOPOLY. I wouldn't rule out their acknowledgement of competence so drastically.
c) SURELY UEFA could always be sued before the Swiss Court for several allegations related to loss of profit/business interruption arising thereby and furtherly compounded by abuse of monopoly and governing authority.

I'm not saying that are all winnable stances/allegations but it's much more than enough to scare a politician to death. particularly one who is carefully aiming to the Chair of Ol' Sepp.

[JonnyAsh]

I reckon there must be still legitimate loopholes to all this.

For instance, what is to stop someone like Hazard, signing for Abu Dhabi Rovers for £30Million, and then they sell him on to us for a free or a loan?

[mcfc1632]

Problem is that UEFA have set financial rules for qualification for years so precedent is on their side. Cannot remotely imagine the European Court getting involved as long as the rules are set and applied fairly across all countries they will have no interest.

I disagree Pal:
a) re. the setting of financial rules for qualification: see point 2 of Sir John early post above. no need to full compliance. next financial statement shall certainly record a significant loss reduction to the previous one.
b) re. European Court unlikelihood of involvement: if anything that Court has always been extremely comprehensive and jelous of anything involving the idea itself of MONOPOLY. I wouldn't rule out their acknowledgement of competence so drastically.
c) SURELY UEFA could always be sued before the Swiss Court for several allegations related to loss of profit/business interruption arising thereby and furtherly compounded by abuse of monopoly and governing authority.

I'm not saying that are all winnable stances/allegations but it's much more than enough to scare a politician to death. particularly one who is carefully aiming to the Chair of Ol' Sepp.

I have a lot of experience of European regulations and whilst a little out of date have spoken to a number of practicing lawyers on this subject in recent years – and I am absolutely convinced – whilst there is much new ground to be trodden and things ‘teased out’ – Socs is bang on.

Re your 1st point – I think that we are all agreed here – and it is clear that CITY have acted to ramp up the spend early so that they can show a ‘path towards compliance’ rather than achieve compliance early. This allows both CITY and UeFA a get out – our execs have been speaking to them very regularly. Khaldoon’s comments on reduced spend this week are also consistent.

On your 2nd point – whilst you are right that the European courts could act robustly if there was evidence of ‘abuse of monopoly’ – Socs is spot on – this is very unlikely to be relevant in this matter. This is because there is much precedent over years and the regulations have been introduced following comprehensive consultation and with the agreement of the clubs – FFS CITY are even taking part in the pilot. Why would the courts be interested in CITY crying foul of a process in which they have been fully consulted on and not only publically agreed to but have signed documents committing their intentions to comply. No abuse of monoply there.

All the issues that could trigger the interest by European courts are satisfied in the manner in which the process has been introduced.

The real shame about these regulations is the way they have been crafted to protect the elite – we are just such lucky fuckers that we are highly likely to have been accepted into that club before these bite and the revenue growth that we will have secured will mean that we can demonstrate compliance in the future and a ‘path to compliance ‘in the next few years. We do need the academy to be successful though.

The real losers are every other club with a profile like the CITY of 2007/8 – the door is closed now and the route we have taken cannot be followed

[Beefymcfc]

Problem is that UEFA have set financial rules for qualification for years so precedent is on their side. Cannot remotely imagine the European Court getting involved as long as the rules are set and applied fairly across all countries they will have no interest.

Here's a question then. If City/Chelsea/Real et al were actually banned and forced to miss out on possibly 50 million that could've gone towards FFP, how would that be viewed legally knowing that any suspension would have an impact on freedom of trade in the future?

[Exiled]

Would be interested to know what the various sponsors would think if UEFA refuse a champion of the EPL/Serie A/Li Liga/Bundesliga/Ligue 1 from entering the Champions League.

[Socrates]

Beefy - it isn't a freedom of trade issue. The competition has qualifying rules, you have to meet them all whether it be league position or financial. 99% of football clubs already miss out on the first criteria. Rangers will be excluded next season on the second criteria, using the old financial rules.

Jonny Ash, nothing to stop your example being done but when the books were examined they would just adjust the accounts back in the other direction for FFP purposes so it would be pointless. They already put in a 'global fair value' clause to stop such abuses.

Mancio, surely it would only be a monopoly issue if there was opposition to the existence of a monopoly competition. I doubt there is any political desire to create competing bodies to conduct different competitions? Of course there is a right for clubs to do so if the politicians wanted football to go the way of boxing...

1632 - very good point about City being involved in the consultation and about the rules having the backing of the European Clubs Association. Also agree with your conclusion, the regulations are disgraceful. They are legally sound though.

[Beefymcfc]

Cheers J, I am still a massive believer that they cannot enforce these rules and your answer is a confirmatory. Another thing that has to be asked is why Chelsea decide to buy 2 players at a cost of 70 odd million knowing it will count towards FFP? Abramovich signed up to it in a position of power yet now he's not quite so strong. He knew at the time that it was getting a little sticky but continued nonetheless.

One of the things that springs out of the FFP is that it would lead to a monopoly for those clubs who have used the system to make them bigger than Ben Hur. My personal opinion would be that if this went legal then the fact that only the biggest revenue earners could make a fist of it would force the FFPR into submission. That and the fact that the CL viewers/sponsors would be missing out on some of the best players in the world would just be a side element.

How about a alternative tournament, even if there were only 2, boasting the best teams in the world, 100 million to the winners played in the Emirates?