Fieldfisher and BDO launch the first football Financial Fair Play guide | Fieldfisher
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Fieldfisher and BDO launch the first football Financial Fair Play guide



United Kingdom

Fieldfisher and BDO LLP have teamed up to produce a comprehensive guide to cost control rules in UK and UEFA competitions.

With the first football Financial Fair Play (FFP) break-even sanctions due to be announced shortly, European law firm Fieldfisher and accountancy and business advisory firm BDO LLP have teamed up to produce a comprehensive guide to cost control rules in UK and UEFA competitions.

The first annual FFP report outlines the rules as they stand and looks at some of the key issues they raise, as well as some of the potential sanctions for non-compliance. Future publications will track any changes to regulations and examine the effectiveness of FFP in its key aim of promoting sustainable business models.

UEFA's first sanctions are due to be handed down in the week commencing 5 May. With the ultimate sanction of a ban from UEFA club competitions, football fans and clubs across the continent will be following developments closely. Of particular interest is the issue of 'related party transactions'. Concerns have been raised over clubs using creative accounting to circumnavigate the spirit of the regulation by manipulating the value of, for example, sponsorship deals, by signing contracts with related parties that exceed fair market value.

Clubs such as Paris Saint Germain and Manchester City, which are owned by the Qatar Investment Authority and the Abu Dhabi United Group respectively, have previously attracted press in this regard. The extent to which UEFA, the Premier League and the Football League enforce the spirit as well as the strict letter of the regulations will be one of the key issues observers will be watching.

Going forward, one issue yet to be resolved is the timing of sanctions, in particular regarding the issue of historic versus real-time reporting. The authors of the FFP report argue for the merits of basing FFP controls on real-time or forecast information, meaning that sanctions would therefore be in the form of preventative measures rather than retrospective penalty measures.

Appeals against any sanctions handed down by UEFA can be made to the Court of Arbitration for Sport, with final appeal decisions having to be taken before the start of next season.

According to the BDO Annual Survey of Football Clubs 2013, which interviewed financial directors from English and Scottish football clubs:

85% of those surveyed expect to comply without significant changes to business models, with a further 10% expecting to comply following significant changes;

83% plan to spend the same or less on their payroll, with 42% saying their decision was influenced by FFP;

88% expect to reduce their transfer budgets or keep them the same, with 41% of English Premier League respondents saying FFP would play a role in this decision; and

88% of respondents claim to have complied with the relevant regulations over the past season.

The report has been authored by Fieldfisher's regulatory senior associate Daniel Geey, and BDO's professional sports group partners Ian Clayden and Trevor Birch.

As the first report of its kind, the Fieldfisher and BDO Financial Fair Play report provides practical legal and accounting insights to the various stakeholders in the world of football. Download the report to discover more.

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