UEFA FINANCIAL FAIR PLAY (FFP)

Financial fair play is a project introduced by the UEFA executive committee in September 2009 which aims to pay off the debts incurred by football clubs and induce them in the long term to financial self-support.
The objective of the FFP was to bring greater economic and financial competitiveness between the Champions League and Europa League teams. Since 2011, clubs that qualify for UEFA competitions must demonstrate that they have no outstanding debts to other clubs, players and social / tax authorities throughout the season; they must prove that they have paid their bills. This must happen in the first two years of the “life” of Financial Fair Play.

Since 2013, clubs must comply with break-even requirements (in economics, the balance between total income and expenses related to a company or a single investment project. In this case, referring to the club) that require clubs to balance expenses with revenues and consequently reduce debts. With this, the Financial Control Body of the Independent Club (CFCB) analyzes the three previous annual accounts each year for all clubs participating in UEFA competitions. The first penalties and the first conditions for clubs not complying with the break-even requirements came after the first check in May 2014. The conditions became effective, however, from the 2014/15 season.

Since June 2015, UEFA has updated its regulations (as is the case with all others) to address specific circumstances that include encouraging more sustainable investments while maintaining control over too much spending. Situations addressed also include clubs requiring corporate restructuring, clubs facing economic shocks, and clubs operating with structural problems in their home region. For the first time, the CFCB’s work is potentially expanded to include clubs that have not qualified for UEFA club competition but who anticipate and want to participate in the future.
clubs can spend up to € 5 million more than they earn in each evaluation period (three years). However, they may exceed this threshold within a certain limit if the debt is fully covered by a direct contribution / payment from the club owner or a related party. This prevents the formation of unsustainable debt.

The limits are:
• 45 million euros for the 2013/14 and 2014/15 seasons
• 30 million euros for the 2015/16, 2016/17 and 2017/18 seasons

To promote investment in stadiums, training facilities and the youth and women’s sector (since 2015), all these costs are excluded from the calculation of budgets.
If a club does not comply with the rules, the Club Financial Control Body will decide the measures and sanctions to be applied.

For post-pandemic, the corrections to be made concern that the budget for the 2019-20 season will be cumulated and will go to average with that for the next 2020-21 season. In the next autumn, for the teams that will qualify for the European cups, the monitoring will only concern the financial statements closed in the years 2018 and 2019. Even rule, which admits a maximum deficit overrun of 30 million, in the autumn of 2021, will cover four years, from the season ended June 30, 2018 to the one ending June 30, 2021. However, the budgets at June 30, 2020 and June 30, 2021 will be valid for one, therefore in the calculation of revenues, costs and losses the average of the two annuities will be taken. If 2020 were to record a red of 90 million and 2021 of 10 million, for example, the liabilities considered (to be added or reduced to the pre-tax profit for the seasons closed on 30 June 2018 and 2019) will be equal to 50 million.

Published by Marco Perrotta

Last news about Italian Football, around the world of soccer and the new tendencies of sports industry in optical Glocal, from one of the 5 big teams in Italy to arrive in a new league like Major League Soccer (MLS) and China Super League. The only indepent site for fans and strangers supporters, that like "Calcio".

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