Financial fair play rules set to reshape Champions League

By Andrew Warshaw in Nyon

May 27 – Europe’s biggest spenders, including Premier League winners Chelsea, could be thrown out of the Champions League within three years under the biggest shake-up ever conducted to crack down on excessive spending.

UEFA’s Executive Committee today rubber-stamped radical proposals to force clubs to reign in their spending and live within their means - or suffer the consequences.

The so-called financial fair play rules, forcing clubs to spend what they earn, will be phased in from 2012-13, outlawing loans to cover losses – which can go no higher than €45 million (£38 million/$56 million) over the first three years cumulatively and no higher than €30 million (£25 million/$37 million) over the subsequent three years.

In applying the brakes on reckless spending, UEFA are severely restricting cash injections from rich benefactors.

The idea is to stop spending on players’ wages beyond income simply in order to chase the dream.

Those who fail to comply could ultimately be barred from entering European competition.

“It is not easy to swallow for everyone but everyone understands it is necessary,” said UEFA general secretary Gianni Infantino.

“We are not trying to punish clubs but to help clubs.

“We don’t want to kill anyone, this is why we have a phased-in approach.”

Earlier this year, UEFA revealed that 50 per cent of European clubs were running at a loss with 20 per cent showing serious deficits.

Clubs in England, Spain and Italy are the biggest culprits but from 2012-2013 onwards, massive spending on transfer fees will be prohibited with rich benefactors paying players only out of revenue accrued.

The likes of Manchester United, Liverpool and Barcelona will no longer be able to take out loans to cover substantial losses, inevitably bringing the curtain down on an era of unregulated spending sprees.

The new rules state that player salaries should not exceed 70 per cent of annual revenue.

Sanctions imposed for irresponsible losses will depend on the amount incurred, with clubs’ accounts scrutinised by an independent panel of legal and financial experts.

“If clubs pay their debts I have no problem,” said UEFA president Michel Platini.

“I am not against debts, I am against losses.”

The first time theoretically that a club could be banned or excluded over the new break-even requirement would be the 2014-2015 season.

“We expect a significant reduction not in the volume of transfers but the amount spent,” said UEFA’s head of club licensing Andrea Traverso.

“Clubs will have to adapt their strategies, that’s for sure.”

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