FFP is dead ( Spurs consequences)

[Delboy75]

Wasn’t there also new rules introduced by the Premier League recently around greater scrutiny of these dodgy sponsorship deals? If I recall 18 teams voted in favour with City and Newcastle voted against…

Yeah just after Newcastle takeover. But then I think it was relaxed a bit. So not sure exactly where that stands now. On the whole I do think the tone is changing and I don’t think it’s gonna be anywhere near as easy for Newcastle as it was for Chelsea and City. We’ve seen with Chelsea how precarious it can be to have your club in one of these owners hands long term. For all levy faults he really has secured us financially for the long term without being dependent on an outside source.

 

[chrisd2k]

I'm no fan of UEFA, but they did in fact ban Man City from playing in the Champions League for two years and fined them €30m for serious breaches of FFP .

It was the Court of Arbitration for Sport (CAS) who then, annoyingly, overturned the ban and reduced the fine to €10m after Man City appealed.

Manchester City's Champions League ban lifted by Cas but club fined €10m

The court of arbitration for sport has lifted Manchester City’s Champions League ban but fined the club €10m

www.theguardian.com

Basically that legal precedent shows the financially doped clubs that throwing money on expensive lawyers will always get you out of trouble, even if UEFA/FIFA do take action against the clubs who don't follow the rules.

True but that just shows that Uefa can't enforce it anyway so what's the point?

 

[chrisd2k]

Yeah just after Newcastle takeover. But then I think it was relaxed a bit. So not sure exactly where that stands now. On the whole I do think the tone is changing and I don’t think it’s gonna be anywhere near as easy for Newcastle as it was for Chelsea and City. We’ve seen with Chelsea how precarious it can be to have your club in one of these owners hands long term. For all levy faults he really has secured us financially for the long term without being dependent on an outside source.

I hope you are right but just can't see it. Uefa are just looking for handouts in the way of fines. Very doubtful they will be able to enforce anything imo.

 

[Locotoro]

I'm no finance expert but the rule change seems to be a good thing. There is a few things I see happening:
I hope...

- it will bring the salaries and transfer fees down across football because these are specific costs that must be kept low rather than the previous FFP which referred to income and non-capital expenditure.
- even if the transfer fees and salaries don't come down it will require clubs to become better run structurally and financially in order to be successful. In the very least clubs will become more creative with their player spending and maybe more creative in generating revenue (maybe this is a bad thing when it comes to the City's and PSGs who can use faux sponsoring deals).
- we'll see more loan deals and more performance related transfers and more emphasis on academies as a stream of revenue.

Spurs are in a safe position because we are a really really well run club. There is nothing stopping a Burnley or a S****horpe attempting to be better run or more creative in their ability to generate revenue.

But it will all revolve around enforcement of rules and with that I have less optimism

 

[Rosco1984]

I'm no finance expert but the rule change seems to be a good thing. There is a few things I see happening:
I hope...

- it will bring the salaries and transfer fees down across football because these are specific costs that must be kept low rather than the previous FFP which referred to income and non-capital expenditure.
- even if the transfer fees and salaries don't come down it will require clubs to become better run structurally and financially in order to be successful. In the very least clubs will become more creative with their player spending and maybe more creative in generating revenue (maybe this is a bad thing when it comes to the City's and PSGs who can use faux sponsoring deals).
- we'll see more loan deals and more performance related transfers and more emphasis on academies as a stream of revenue.

Spurs are in a safe position because we are a really really well run club. There is nothing stopping a Burnley or a S****horpe attempting to be better run or more creative in their ability to generate revenue.

But it will all revolve around enforcement of rules and with that I have less optimism

I thought the premier league put a freeze on owner or state funded sponsorship when they allowed the newcastle takeover?

if that is the case this change may well limit city in future years.

 

[chrisd2k]

I thought the premier league put a freeze on owner or state funded sponsorship when they allowed the newcastle takeover?

if that is the case this change may well limit city in future years.

Please. Who's going to stop them? They've shown they can break the rules and get away with it. Plus technically they probably don't own these companies. Technically

 

[cockerel downunder]

I wonder if agent fees are also included in the 70%? I hope so otherwise they will end up even higher.

not sure why people say this disadvantages smaller clubs, it just stops clubs being run in an sustainable way, whether big or small.

If a club like Everton is running a wage bill over 100% of revenue the whole future of the club is being gambled on quick success. hardly a good thing.

or Chelsea who’s business model relies on regular loans from abramovich which enables them to Hoover up all the young English talent and stockpile 3 squads worth of first team players, with 2 of them out in loan. Hardly a good thing.

im struggling to see any reason to criticise this new rule, especially when combined with the recent rule changes around inflated sponsorships.

 

[arnoldlayne]

I'm hoping it will reduce the habit of buying players and parking them - reducing availability to other clubs

That and the restrictions on loan players

Surely this will be good for clubs like Spurs who stay within the rules and are not owner dependent?

 

[Dillspur]

I think we'll see a lot more multi year loans to buy, it'll spread the cost over years and allow teams like Newcastle to spend even more

 

[FloridaSpur]

"According to the proposed rules, teams may under certain circumstances be allowed the flexibility to spend up to about $10 million above the ratio, provided they have healthy balance sheets and have not breached regulations before."

So who determines what a "healthy balance" is?

Exhibit A from The Guardian (Googled):

"Manchester United's net debt stood at £494.8m on 31 December 2021, up from £455.5m at the end of the previous year, according to the club's latest accounts. Mar 1, 2022"

 

[arnoldlayne]

"According to the proposed rules, teams may under certain circumstances be allowed the flexibility to spend up to about $10 million above the ratio, provided they have healthy balance sheets and have not breached regulations before."

So who determines what a "healthy balance" is?

Exhibit A from The Guardian (Googled):

"Manchester United's net debt stood at £494.8m on 31 December 2021, up from £455.5m at the end of the previous year, according to the club's latest accounts. Mar 1, 2022"

They are talking about rebuilding the stadium - so their debt will go up higher than ours - currently, their stadium is in a poor state

 

[Dillspur]

Saw this on the bbc:

"Crucially, the plans, that are being put together by Uefa and the influential ECA also double the permitted losses over a three-year period from €30m (£24.98m) to €60m (£49.96m), providing they are covered by cash injections"

So you can't spend more than 70% but you can make loses providing it's covered? I'm confused

 

[SirHarryHotspur]

Also confused, don't really understand all these new proposals, the likes of Man City etc will probably sign some new exaggerated sponsorship deal to get round the new regs , same old clubs will be at the top of their respective leagues regardless of what UEFA do.

 

[vegassd]

Saw this on the bbc:

"Crucially, the plans, that are being put together by Uefa and the influential ECA also double the permitted losses over a three-year period from €30m (£24.98m) to €60m (£49.96m), providing they are covered by cash injections"

So you can't spend more than 70% but you can make loses providing it's covered? I'm confused

My guess is that they need to build in some sort of grace period for teams who see a sudden drop in revenue for sporting reasons.

If a regular CL team has their expenditure at 70% but then falls out of the CL their revenues instantly drop but their expenditures will stay the same. Rather than instantly slapping them with fines or bans, there should be a time period in which they either rebuild those revenues (e.g. get back in the CL) or adjust their expenditures down... and if they can't do that organically the owners need to dip into their own pockets so the club itself isn't driven into debt.

It's one of those things that is probably a sensible idea and something that is necessary. And whilst it looks like a bit of a loophole on the surface, I'm not sure that £50m over three years is the sort of deficit that would be classed as buying success or anything like that.

But like I say, just a guess. I haven't fully read the details of the new scheme. It's bound to get torn apart by legal teams anyway so it's all a bit "meh" to me!

 

[Neon_Knight_]

Also confused, don't really understand all these new proposals, the likes of Man City etc will probably sign some new exaggerated sponsorship deal to get round the new regs , same old clubs will be at the top of their respective leagues regardless of what UEFA do.

Which PIF-owned company do you think will sign the record-breaking naming rights deal for St. James' Park then? They have stakes in Boeing, Capcom, Disney, Bank of America etc.

 

[Delboy75]

New rule approved ?

Wow includes transfers wages and agent fees at 70% of revenue. It’s huge if they really implement this to the letter.

 

[Delboy75]

Had a rough look at Liverpool from last season pre covid accounts which is 18/19 and I’ve no idea how this is going to work without either massive lift in revenue or cut in wages. Remember this is season they won CL as well. But with general tv and commercial increases they will probably be around these figures for this season.

Revenue £530m

Max spend with 70% cap £375m

Wages £320m

Agent fees - not sure although vaguely remember some figure around £30m but might be more. But let’s say £30m

That would leave £25m for transfers.

 

[topper]

Which PIF-owned company do you think will sign the record-breaking naming rights deal for St. James' Park then? They have stakes in Boeing, Capcom, Disney, Bank of America etc.

Given how Mickey Mouse NUFC is I’m expecting Disney

 

[Rosco1984]

Had a rough look at Liverpool from last season pre covid accounts which is 18/19 and I’ve no idea how this is going to work without either massive lift in revenue or cut in wages. Remember this is season they won CL as well. But with general tv and commercial increases they will probably be around these figures for this season.

Revenue £530m

Max spend with 70% cap £375m

Wages £320m

Agent fees - not sure although vaguely remember some figure around £30m but might be more. But let’s say £30m

That would leave £25m for transfers.

It doesn't fully kick in for 3 seasons. its 90% for the next few. But teams like Liverpool will have to start cutting down beforehand obviously. Or just gamble on them not enforcing it and just rolling over like they did when city took FFP to court.

 

[Trix]

I expect you'll see more stockpiling of the best young players the big clubs bringing them in even earlier to fulfil home grown quota's....