Committee unanimously approved a financial fair play concept for the game’s well-being in September 2009 and on 27 May 2010 approved the UEFA Club Licensing and Financial Fair Play Regulations Edition 2010, in the presence and with the full support of the European Club Association chairman, Karl-Heinz Rummenigge. The concept, which has been supported by everyone around football, looks at the long as well as short-term health of club football and individual clubs.
In particular, the objectives aim to introduce more discipline within club finances and encourage responsible spending and investment. Financial fair play is a key point in the 11 values of the UEFA president presented at the UEFA Congress in Copenhagen in March 2009. Despite a background of huge and increasing public and commercial interest in European club football over the last decade, many clubs across Europe are in poor financial health, struggling to meet their financial responsibilities and commitments, and reporting repeated financial losses.
UEFA has a duty to consider the systemic environment of European club football in which individual clubs compete, in particular, the wider inflationary impact of clubs’ spending on salaries and player transfer fees and increasing levels of indebtedness across European club football, as the Club Licensing Benchmarking Report shows. Therefore, as requested by and in consultation with the football family, UEFA has aimed to develop sensible and achievable club monitoring requirements to supplement the existing club licensing criteria, in order to safeguard the sustainability of European club football.
To supplement and complement the former UEFA Club Licensing Regulations, the UEFA Club Licensing and Financial Fair Play Regulations, comprising both club licensing criteria and club monitoring requirements derived from the financial fair play concept, entered into force on 1 June 2010, with the various financial fair play requirements being phased in over a number of seasons. The consistent application of the club licensing criteria by licensors and the monitoring of clubs are overseen by the independent Club Financial Control Panel, which was created in 2009.
If a criterion or requirement of the regulations is not fulfilled, appropriate measures will be taken against the club by UEFA’s independent disciplinary bodies. Potential disciplinary sanctions are the remit of the competent disciplinary bodies that have a palette of sanctions at their disposal including ultimately the exclusion from future UEFA club competitions. Since its creation, the Club Financial Control Panel has referred numerous clubs to UEFA’s disciplinary bodies for both club licensing and club monitoring breaches.
Of course many people also believe that the dream of Michel Platini for competitive but healthy football for all the 660 football teams under UEFA’s jurisdiction will fail. But taking into consideration the fact that if the FFP fails the credibility of Michel Platini will be harmed the UEFA Club Financial Control Panel are determined to help the president of UEFA achieve its dream.
The tasks of the independent Club Financial Control Panel to achieve Platini’s dream are to ensure that the UEFA club licensing system is applied correctly across all 53 UEFA member associations and that clubs have fulfilled the criteria defined in the UEFA Club Licensing and Financial Fair Play Regulations. As well as conducting and deciding on licensing compliance audits to check the awarding of licenses by the national decision-making bodies and checking that club competition integrity rules have been observed, the Club Financial Control Panel governs the ongoing club monitoring process (financial fair play) after the awarding of licenses.
It was introduced at the start of the 2004/05 season with the goal of encouraging European club football to look beyond the short term and consider underlying longer-term objectives essential for the game’s continued good health. It is based on a series of defined quality standards, which each club must accomplish to gain entry to UEFA’s club competitions, and on the key principles of transparency, integrity, credibility and capability.
The 36 specific criteria of the licensing system can be broken down into five main categories: 1) sporting 2) infrastructure 3) personnel 4) legal 5) financial These criteria – developed in cooperation with the national associations – have helped to improve the credibility of club operations and led to better transparency and governance by clubs and national associations. A license granted to a club by its national association proves that it has achieved a certain quality level.