Deloitte’s Money League: Yet Another Proof the FFP is a Joke

The numbers show that UEFA's Financial Fair Play is a complete failure

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The Deloitte’s Money League had a number of interesting developments in the 2014 edition.

Bayern Munich knocked Manchester United out of our top three – the first time United have not been on the
podium. However, the major change was the emergence  of Paris Saint-Germain, who secured the fifth place – climbing above Chelsea (7th) and Arsenal (8th). The continued development of Manchester City has resulted in the club climbing to sixth position and achieving the unprecedented status of being ahead of their Premier League rivals from London.

How did City and Paris manage that? City, owned by Abu Dhabi, signed huge sponsorship deals with companies from Abu Dhabi, which allowed them to have commercial income of €166.9 – just a few millions less than neighbors Manchester United (€177.9m).

PSG, owned by QSI (Qatar Sports Investments), signed huge sponsorship deals with companies from, surprise surprise, Qatar!

Paris Saint-Germain actually recorded the highest ever commercial revenue for a football club. In fact, PSG’s €254.7m commercial revenue is the highest ever from a single revenue stream in the history of the Money League. PSG have been able to increase their revenue almost five-fold since 2009/10.

For comparison, Bayern Munich’s commercial income stood at €237m. They are by far the most commercialized club in Europe. Closest rivals in that sense are Real Madrid, with commercial income of €211.6. The rest of the clubs have never gotten close to €200m in commercial income.

These numbers show that UEFA’s financial fair play is a complete failure.

Why? Because UEFA’s ”Fair Value” rule should have dealt with “un-natural” surges in “natural income”.

The Fair Value rule is It’s UEFA’s way to ensure that owners do not artificially inject cash into the club as a way of circumventing the Financial Fair Play rules. It’s a pivotal clause in the financial fair play rules because without it it will be very easy for owners to bypass these rules by getting their companies to pour millions into their teams.

But for two years now, Qatar Tourism Authority (QTA) poured up to €200m a year into Paris Saint-Germain under an advertising contract designed only to help the French club meet UEFA’s financial fair-play rules. This deal has no real “fair value” because tourism deals are usually valued at no more than €5m. It’s worth mentioning that QTA deal with PSG doesn’t include shirt sponsorship or stadium naming rights.

UEFA should not allow this deal help PSG meet FFP rules. If UEFA allows  Qatar to artificially inject cash into the club their club, then what stops Roman Abramovich’s company Millhouse Capital to spend €100m per year on Stamford Bridge naming rights? If Qatar can do it, why can’t Abramovich do it? And while we are at it, Stan Kroenke’s wife Ann Walton Kroenke can sign a sponsorship contract with Arsenal that will turn The Emirates Stadium into the Wal-mart Stadium for a cool €500m? It’s OK – PSG are doing it.

The Financial Fair Play rules were brought in to prevent professional football clubs spending more than they earn in the pursuit of success and in doing so getting into financial problems which might threaten their long term survival. However, the FFP has just created a ridiculous arms race that radicalized the growing gaps between the rich and poor clubs.

PSG are making a a mockery of the Financial Fair Play rules. But how can they prevent it from happening? Their boss, Michel Platini, is so well connected to Qatar. His son works for QSI.

Here are some alternatives for the Financial Fair Play.

* Uefa Should Seriously Consider an Alternative to FFP

Real Financial Fair Play 1.0

Financial Fair Fail

The Transfer Market Should be Closed for Repairs

The 2014 Money League

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