1. UEFA & Football League Financial Fair Play Regulations

2. Objectives of the Regulations
to improve the economic and financial capability of the clubs;
to place the necessary importance on the protection of creditors;
to introduce more discipline and rationality in club football finances;
to encourage clubs to operate on the basis of their own revenues;
to encourage responsible spending for the long-term benefit of football; and
to protect the long-term viability and sustainability of European club football.

3. UEFA Club Licensing System v Football League Compliance
European Cup Competition (License application) v Domestic League Dynamic (accounts application)
From 2013/14 season UEFA monitoring requirements will include Financial Fair Play adherence
From 2012/13 season FL will ensure Financial Fair Play adherence

4. Aiming for a Deflationary Effect
Clubs to spend no more than they earn (with exceptions)
Infrastructure investment permitted
The Debt v Loss Debate

5. UEFA Break Even (ish) Acceptable Deviation Levels Monitoring Period
Number of Years
Years Included in the Calculation
Acceptable Deviation (€m)
T-2
T-1 T
Equity investment
Non-equity investment 2 3
N/A 45 30
> 30 5

6. Football League Break Even (ish)
Reporting Period
Reporting Period Equity Contributions
Reporting Period Acceptable Deviation
Total Acceptable Deviation
2011/12
£8m
£4m
£12m
2012/13
£6m
£10m
2013/14
£5m
£3m
2014/15
2015/16
£2m
2016/17
onwards £3m or lower
onwards £2m or lower
>£5m

7. Manchester City and Etihad: Case Study
Record-breaking 10 year, £400m shirt stadium and Etihad campus deal
Definition of Related Party Transaction
a club will fail the "related party" test if money comes in from a "close member" of the club owner's family who "has significant influence over the [club]".
City are confident that they can demonstrate that Etihad's chairman, Sheikh Hamed bin Zayed al-Nahyan, and vice-chairman Sheikh Kaled, both half-brothers, do not exert any influence over City.

8. An Early Loophole- Annex XI Definition
Players under contract before 1 June 2010
“If a licensee reports an aggregate break-even deficit that exceeds the acceptable deviation and it fulfils both conditions described below then this would be taken into account in a favourable way.
i) It reports a positive trend in the annual break-even results (proving it has implemented a concrete strategy for future compliance); and
ii) It proves that the aggregate break-even deficit is only due to the annual break-even deficit of the reporting period ending in 2012 which in turn is due to contracts with players undertaken prior to 1 June 2010 (for the avoidance of doubt, all renegotiations on contracts undertaken after such date would not be taken into account).
This means that a licensee that reports an aggregate break-even deficit that exceeds the acceptable
deviation but that satisfies both conditions described under i) and ii) above should in principle not be
sanctioned.”

9. An Early Loophole- Annex XI Definition
Player
Date Signed
Length of Contract (in years)
Expiry of Contract
Eligible for Annex XI Qualification? A
June 2009 5
June 2014
Yes B 4
June 2013 C 3
June 2012 D
May 2010
May 2015 E
July 2010
July 2015
No, as the contract was signed after the 1 June 2010 deadline

10. Financial Fair Play Rules Timeline
FFPR in force
(first monitoring period)
(One year to go)
season
(Second monitoring period)
(Two years to go)
season
(Third monitoring period)
27 May 2010
Clubs to supply at least 2 years worth of accounts
Accounts from this season will be used for the license application
The earliest possible date clubs may be required to breakeven
FFPRs approved and published by UEFA
Acceptable deviation = €15m per season
Accounts from this season will be used for the license application
When applying for a UEFA license, clubs will have to adhere to the FFPRs too
Acceptable deviation = €10m per season
Clubs to supply 2 years worth of accounts
Acceptable deviation = €22.5m per season
Clubs can take advantage of Annex XI(2) wage exemption

11. UEFA and Football League Sanctions
UEFA: Club Financial Control Body
Football League: Financial Fair Play Panel
UEFA's general secretary, Gianni Infantino, has recently stated “There may be intermediate measures. We would have to ask why, maybe there would be a warning, but we would bar clubs in breach of the rules from playing in the Champions League or the Europa League. Otherwise, we lose all credibility.”
UEFA sanctions: expulsion, docking points, fines, refusal of application PLUS withholding prize money or limiting the number of players registered for European competition
FL sanctions: transfer embargo or fine

12. Football League Fine Calculation Illustration
Percentage of the Excess
Excess
Calculation (rounded up)
1% of the Excess between
£1 and £100,000;
£1,000
20% of the Excess between
£100,001 and £500,000;
A maximum of £80,000
40% of the Excess between
£500,001 and £1,000,000;
A maximum of £200,000
60% of the Excess between
£1,000,001 and £5,000,000;
A maximum of £2.4m
80% of the Excess between
£5,000,001 and £10,000,000
A maximum of £4m
100% of the Excess over
£10,000,000.
No Maximum

13. Talk Takeaways
Rules/sanctions in force by (UEFA) and (FL) season
Leeway for a transitional period
A phased approach obviously beneficial for clubs
Pure break-even not required for some time in both sets of rules