On Friday UEFA held an FFP press briefing in Nyon. The 2 hour session provided number of interesting updates - only a few of which have been reported in the British press.

76 clubs referred for Break Even Deficit

As has been widely reported, 76 clubs were required to provide additional financial information to UEFA. Some media outlets probably not at the session seemed to sensationalise what UEFA were saying in respect to the 76. Essentially the 76 clubs are those that met all the following criteria:

  • Qualified for UEFA competition in 2013/14
  • Made a Break Even defict in 2011/12 financial year
  • Had turnover above 5m Euros

As we know, the first Monitoring Period covers the financial results over two seasons. However, given the number of clubs that gain entry into UEFA competition (231 annually), UEFA decided to only request the latest set of accounts if the 2011/12 accounts showed the club were had made a loss (after permitted exclusions). Suggestions that 76 clubs may have failed FFP are somewhat wide of the mark - a deficit of just 1 euro would have triggered the request for the second set of accounts.

Chelsea made a small profit in 2011/12 and I am reliably advised that they are not one of the 76. If so, they will not receive any FFP sanction this season.

Related Party Transactions -

I am grateful for one journalist for asking a very specific question regarding RPTs. The question was essentially : 'In a number of club accounts, auditors have made decisions about whether an item is an RPT or not. If an item has not been assessed by the club auditors as an RPT does that mean the CFCB will therefore also not be considering the item to be an RPT?  The answer confirmed that the CFCB Investigatory Chamber would be looking at the accounts with a fresh pair eyes and will not be relying on the auditors classification of RPT items. ‘As a matter of principle, the checks will be done from scratch’. It was confirmed that the CFCB will carry out their own assessment and determine if the item is an RPT. 

UEFA's very clear answer will be of particular interest to fans of Manchester City and PSG - it is clear the Etihad deal and the QTA deal will be assessed against the RPT rules and if judged to be an RPT will undergo a fair value assessment. 

Independent CFCB

The independent nature of the CFCB panel was something that came over very strongly from the session. UEFA have established the CFCB adjudicatory chamber with senior legal individuals (headed by two former European Court of Justice – the top court in Europe).  They were pressed on whether UEFA bosses had privately given the CFCB Adjudicatory chamber an ideal of where they were intended the FFP punishments to be applied. Alasdair Bell (UEFA director of Legal Affairs) advised that they are not able to tell the panel how to act or indeed what punishments to apply. He explained that this is somewhat a risk for them - they essentially pass the rulebook and the menu of punishments over to the Adjudicatory panel and have to leave that to them to decide how to proceed. 

As I have written previously, this arrangement has been made so that punishments are applied 'at arms-length' from UEFA and helps ensure that the UEFA is insulated from legal action. The downside for UEFA is that the panel may decide to apply punishments in a way other than how they would have wished.

I feel it is interesting to note that last year the CFCB handed out a ban to Malaga for failing to confirm their overdue payables (outstanding wages/tax) by the prescribed date. This could suggest that the punishments handed out adjudicatory panel for Break Even breaches may not be particularly lenient – however will have to wait and see.

Tiimeline

UEFA added more detail to the timeline. By the end of April (possibly early May) any club that is considered to have made a minor FFP transgression will be handed their sanction. These punishments and the clubs will be made public. Any clubs that have considered to have made a significant breach will be referred to the CBCB Adjudicatory Chamber - clubs punished in this tranche will find out their sanction before the end of June.

 Challenges to FFP punishments

Any punishments applied by the CBCB Adjudicatory Chamber can only be appealed to CAS (the Court for Arbitration in Sport). Bell advised that clubs are not able to lodge an appeal in the Civil Courts in their country. Can only make any appeal to the Swiss Federal Tribunal – however their scope is very narrow, and the case can only investigate a technicality and they cannot revisit the case on its merits.

UEFA is expecting that some clubs punished in this tranche will take appeal and take their case to CAS. Cases taken to CAS are expected to be resolved by mid August.

Striani case – Legal Challenge to FFP

The agent Striani has mounted a legal challenge to the FFP rules. Alasdair Bell advised: “that case is about an agent who is worried that he will earn less money because clubs are not spending money that they don’t have”.  “I don’t think the European Commission is going to go very far with it”.

Sanctions mid term

The UEFA panel advised that they are not expecting to see any sporting sanctions applied mid-term (although this will be up to the CBCB Adjudicatory Chamber).

Judging on numbers or on behaviour?

An interesting question was raised (rather thinly veiled but obviously relating to PSG). The question was whether the CFCB Chamber will judge compliance on the numbers and also on behaviour; if a club that was, for example, backdating a contract and making fun of FFP, would it expect a more harsh punishment. Alasdair Bell advised that it would be normal for any tribunal or court to take into account behaviour and consider if an attempt had been made to mislead it. However he again stressed that the CFCB Adjudicatory Chamber is independent.

Third Party Ownership

UEFA is closing the door on Third Party Ownership. They are expecting the new rule come in the season after next and it might take around 3 further years to bring about closure.