Financial Fair Play / Profit & Sustainability

[Jackie Broon]

46 minutes ago, Dr Jinx said:

They’ll be counting on City winning that related transaction thing and then it being thrown out. It will leave the door open then for increasing our revenue in that manner which will see the UEFA constrictions nullified.

 

Well, not nullified altogether if UEFA's FMV rules remain, but they seem to have a much more relaxed approach to FMV even though, on paper, the rules seem more stringent.

[The College Dropout]

10 hours ago, timeEd32 said:

It’s possible we only needed a portion of Anderson’s fee on top of Minteh. 
 

If we needed all or most of it I’m honestly scared what our cost base has risen to.

And then we got the Ashworth deal done for the same deadline right?

 

Gives further credence that we needed all the money from both transfers (Minteh might have had fairly substantial sell-on clauses 5-25% I assume, + his amortisation costs) and some.

 

53 minutes ago, Dr Jinx said:

They’ll be counting on City winning that related transaction thing and then it being thrown out. It will leave the door open then for increasing our revenue in that manner which will see the UEFA constrictions nullified.

Maybe it's your language - but I don't think they would be "counting on it" as in - basing our strategy for this summer on City winning the case. We'll have to plan that we can't do that - for this summer at least.

[Dr Jinx]

2 minutes ago, The College Dropout said:

And then we got the Ashworth deal done for the same deadline right?

 

Gives further credence that we needed all the money from both transfers (Minteh might have had fairly substantial sell-on clauses 5-25% I assume, + his amortisation costs) and some.

 

Maybe it's your language - but I don't think they would be "counting on it" as in - basing our strategy for this summer on City winning the case. We'll have to plan that we can't do that - for this summer at least.

Not counting on it for this summer, any changes would be next season, or maybe January at the earliest.

 

I honestly think the whole thing will collapse at some stage. There’s a movement of pushback against it and eventually one of the “big clubs” will have their arse exposed and the punishment won’t be the same as what’s been handed out up to this point.. way more lenient and at that point the gig will be up.

[The College Dropout]

2 minutes ago, Dr Jinx said:

Not counting on it for this summer, any changes would be next season, or maybe January at the earliest.

 

I honestly think the whole thing will collapse at some stage. There’s a movement of pushback against it and eventually one of the “big clubs” will have their arse exposed and the punishment won’t be the same as what’s been handed out up to this point.. way more lenient and at that point the gig will be up.

I think there needs to be some restrictions. But not one that maintains the status quo. Which is why I liked anchoring.

 

If us, Villa and whoever want to challenge - if our owners can pump in the money - let us. But don't let 1 club dominate a division the way PSG or Bayern have because their funds are too strong.

[LFEE]

 

[JUICE690]

14 minutes ago, LFEE said:

 

Premier League's 'not easy' FFP admission in front of Newcastle takeover lawyer

by Ciaran Kelly

 

Newcastle United have set out to comply with the Premier League's profit and sustainability rules but the top-flight's own KC admitted the regulations are 'not perfectly drafted'

The Premier League's profit and sustainability rules are 'not perfectly drafted' and 'not easy to construe'.

 

That is the view of Jane Mulcahy, KC, on behalf of the top-flight, after an independent commission dismissed a challenge by Leicester City following an alleged breach of the regulations in 2022/23. Leicester had questioned whether an independent commission had the jurisdiction and authority to hear the case after the Premier League referred the club back in March, but this was rejected. Leicester, who were represented by, among others, Nick De Marco, the KC who previously acted for Newcastle, have appealed the decision.

Although this case, obviously, concerned Leicester, there were some striking wider points in the commission's written reasons. The commission explained that the purpose of the PSR rules are to 'prevent overspending and poor financial management that may lead to a club's insolvency and jeopardise the club, the integrity of the competition and the sport of football and, to a lesser extent, preserve fair competition between the PL clubs'.

 

The commission's use of the words 'lesser extent' regarding fair competition felt significant just a few months after football finance expert Kieran Maguire said the top-flight's failure to raise permitted losses in line with inflation had hit upwardly mobile clubs such as Newcastle 'hardest' following the takeover. Perhaps, what was most grabbing was the Premier League's own legal representative's take on rules that were introduced more than a decade ago.

 

"We do accept it is possible that the PL rules were drafted in a manner that is unsatisfactory, anomalous or exposed a gap," the commission stated in their written reasons. "Ms Mulcahy KC conceded on behalf of the PL at the hearing that 'it is not easy to construe these rules' and that 'they are not perfectly drafted'."

 

The existing PSR rules, which limit losses to up to £105m over a three-year period, remain in place as Newcastle know only too well after a late scramble to raise funds last weekend, but Premier League clubs are trialling squad cost regulations and top to bottom anchoring in shadow. This will enable the league and clubs to fully evaluate the system, including the operation of UEFA’s equivalent new financial regulations, and to complete consultation with all relevant stakeholders.

[huss9]

8 hours ago, JUICE690 said:

Premier League's 'not easy' FFP admission in front of Newcastle takeover lawyer

by Ciaran Kelly

 

Newcastle United have set out to comply with the Premier League's profit and sustainability rules but the top-flight's own KC admitted the regulations are 'not perfectly drafted'

The Premier League's profit and sustainability rules are 'not perfectly drafted' and 'not easy to construe'.

 

That is the view of Jane Mulcahy, KC, on behalf of the top-flight, after an independent commission dismissed a challenge by Leicester City following an alleged breach of the regulations in 2022/23. Leicester had questioned whether an independent commission had the jurisdiction and authority to hear the case after the Premier League referred the club back in March, but this was rejected. Leicester, who were represented by, among others, Nick De Marco, the KC who previously acted for Newcastle, have appealed the decision.

Although this case, obviously, concerned Leicester, there were some striking wider points in the commission's written reasons. The commission explained that the purpose of the PSR rules are to 'prevent overspending and poor financial management that may lead to a club's insolvency and jeopardise the club, the integrity of the competition and the sport of football and, to a lesser extent, preserve fair competition between the PL clubs'.

 

The commission's use of the words 'lesser extent' regarding fair competition felt significant just a few months after football finance expert Kieran Maguire said the top-flight's failure to raise permitted losses in line with inflation had hit upwardly mobile clubs such as Newcastle 'hardest' following the takeover. Perhaps, what was most grabbing was the Premier League's own legal representative's take on rules that were introduced more than a decade ago.

 

"We do accept it is possible that the PL rules were drafted in a manner that is unsatisfactory, anomalous or exposed a gap," the commission stated in their written reasons. "Ms Mulcahy KC conceded on behalf of the PL at the hearing that 'it is not easy to construe these rules' and that 'they are not perfectly drafted'."

 

The existing PSR rules, which limit losses to up to £105m over a three-year period, remain in place as Newcastle know only too well after a late scramble to raise funds last weekend, but Premier League clubs are trialling squad cost regulations and top to bottom anchoring in shadow. This will enable the league and clubs to fully evaluate the system, including the operation of UEFA’s equivalent new financial regulations, and to complete consultation with all relevant stakeholders.

then fucking change them

[Teslact]

Given the various loopholes, I wonder if the "West Ham giving out 7 year contracts" could be structured to be a 5+2 that becomes 5+1 then 5? For example, a 50m purchase would be 10m the first year and then renews into 40/5 = 8m the second then 32/5 = 6.4m for the next 5 years, rather than 10m for 5 years?

[Abacus]

I'd have thought that would only count for actual contract extensions, but who knows.

 

The rules as they stand are basically such an attempt to reach into the affairs of clubs that they are doing things even the proper financial authorities wouldn't attempt.

 

I wonder when we'll hear about Man City's arbitration challenge. Still don't know, from  the reporting, if this was a challenge to ATP as a whole or just to the latest attempt to tighten them (e.g. burden of proof being on clubs for FMV).

 

Either way, I don't suppose it matters - even if it's just the latter part, I can't see the main rules then being enforceable. And from there, PSR and revenue caps effectively unravel too, like a woolly jumper caught on a nail.

[Upthemags]

Can someone explain, for example, the effect of extending Gordon's contract? Is the remaining balance of his contract then spread out even further over the number of years he is extended? Or does the contract fully amortize under the original contract term of years?

[Scoot]

4 minutes ago, Abacus said:

I'd have thought that would only count for actual contract extensions, but who knows.

 

The rules as they stand are basically such an attempt to reach into the affairs of clubs that they are doing things even the proper financial authorities wouldn't attempt.

 

I wonder when we'll hear about Man City's arbitration challenge. Still don't know, from  the reporting, if this was a challenge to ATP as a whole or just to the latest attempt to tighten them (e.g. burden of proof being on clubs for FMV).

 

Either way, I don't suppose it matters - even if it's just the latter part, I can't see the main rules then being enforceable. And from there, PSR and revenue caps effectively unravel too, like a woolly jumper caught on a nail.

 

They were challenging Associated Party Transactions as a whole from nearly all the reports about it.

[Abacus]

1 minute ago, Upthemags said:

Can someone explain, for example, the effect of extending Gordon's contract? Is the remaining balance of his contract then spread out even further over the number of years he is extended? Or does the contract fully amortize under the original contract term of years?

My understanding is that a contract extension within the period of his existing contract, would extend the amortisation of the remaining value of his initial purchase price for a maximum total period of 5 years.

 

But happy to be corrected on that.

[80]

10 minutes ago, Abacus said:

My understanding is that a contract extension within the period of his existing contract, would extend the amortisation of the remaining value of his initial purchase price for a maximum total period of 5 years.

 

But happy to be corrected on that.

Yeah, that's my understanding, too. E.g. if his £45m was now down to £30m, a new 5 year contract would re-spread the £30m over the next 5 years i.e. from now on, £6m per year being deducted from our PSR 'allowance'.

[Abacus]

2 minutes ago, 80 said:

Yeah, that's my understanding, too. E.g. if his £45m was now down to £30m, a new 5 year contract would re-spread the £30m over the next 5 years i.e. from now on, £6m per year being deducted from our PSR 'allowance'.

Yeah, and that in itself may pay for any salary increase a new contract might bring.

[FloydianMag]

37 minutes ago, Abacus said:

I'd have thought that would only count for actual contract extensions, but who knows.

 

The rules as they stand are basically such an attempt to reach into the affairs of clubs that they are doing things even the proper financial authorities wouldn't attempt.

 

I wonder when we'll hear about Man City's arbitration challenge. Still don't know, from  the reporting, if this was a challenge to ATP as a whole or just to the latest attempt to tighten them (e.g. burden of proof being on clubs for FMV).

 

Either way, I don't suppose it matters - even if it's just the latter part, I can't see the main rules then being enforceable. And from there, PSR and revenue caps effectively unravel too, like a woolly jumper caught on a nail.

APT rule is being challenged on whether it is lawful under UK competition law. 

[Abacus]

1 minute ago, FloydianMag said:

APT rule is being challenged on whether it is lawful under UK competition law. 

Fair enough, there were a couple of different reports earlier. As I say, it probably doesn't really matter, as they likely all fall down anyway whatever the challenge is.

 

[FloydianMag]

56 minutes ago, Abacus said:

Fair enough, there were a couple of different reports earlier. As I say, it probably doesn't really matter, as they likely all fall down anyway whatever the challenge is.

 

I hope so🤞

[gjohnson]

A few simple changes could solve all this bs in one go.

 

Pay up front and in full. If you can't then there's no transfer. 

 

Owners are allowed to top up at will, but only to the maximum declared value of prize money and tv income. Anything beyond this would count as 'illegal' or undeclared income and therefore not allowed to be spent on any football related activity.

 

Pretty much ends the sport being ran and dictated by accountants and puts the balance back on actually what is sitting in the bank and how well you've done on the field

[gdm]

 

[Nucasol]

1 minute ago, gdm said:

 

Surely it should be dictated by what someone is willing to pay? The value to a petrochemical state looking to broaden its economic activities ahead of the net zero transition drives a premium - I’d argue Visit Qatar is paying considerably more than its European competitors for Euros sponsorship. Same with China and Hisense/AliExpress. 
 

The PL is riddled with conflicts, going all the way back to certain other red shirt clubs getting to vet the prospective CEO.

[AyeDubbleYoo]

I've always said, it feels like something as subjective as fair market value is an absolutely crazy thing to try to assess. 

 

If Man City shirts are worth £60m, who is to say if ours are worth £60, 50 or 40? Makes no sense. 

 

You could say "Hmm, that looks a bit expensive" but I don't feel like you can say it's unfair with enough certainty to fine people and dock them points. 

[Slim]

13 minutes ago, gdm said:

 

"Legal documents from City also allege that the rules were designed to “discriminate against Gulf owners”. That bold claim is based on the fact that APTs were brought in as a response to the Saudi-backed takeover of Newcastle in 2021."

 

[The College Dropout]

Aye the costs are spread throughout the players new contracts.

 

 

 

However, with us signing young players on cheapish wages - a lot of the amortisation savings from spreading contracts even further are offset by wage increases. Which is good and bad. The player doesn't become any more expensive for the club - but doesn't become anymore cheaper.

 

I've shared the KDB chart loads for amortisation. It should be stickied to help people understand it.

[Dokko]

PL about to be bum fucked into oblivion. Such a shame. 

[TRon]

2 hours ago, gdm said:

 

 

 

Lol, the PL will have to keep on spending their funds on fighting legal battles on behalf of the cartel. I wonder how long fans will tolerate good money being thrown after bad on behalf of a select few clubs?