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UEFA Introduces Tough Penalties For Extravagant Clubs

May 30, 2010 6:09:32 AM - thesundayleader.lk

Portsmouth's financial meltdown has highlighted the problem

Profligate clubs face being banned from the Champions League and Europa League after European football’s governing body UEFA approved new plans.
UEFA president Michel Platini has now passed rules which would force clubs to operate within their means. Clubs will only be able to spend what they themselves generate.
Big cash injections from wealthy benefactors like the owners of Chelsea and Manchester City would also be restricted under UEFA’s ‘Financial Fair Play’ plan.
The system is being phased in and bans would not be able to be imposed theoretically until the 2014-15 season at the earliest. Clubs are required to restructure themselves over the next three seasons so they are financially solvent.
The devil is in the detail but, basically, it means clubs’ financial returns will be monitored over a three-year period and they will be expected, on average, to spend no more than they earn.
UEFA General Secretary, Gianni Infantino said: “The main rule is the break-even requirement which will be phased in over the next three years. It is not as easy to swallow for everyone but everyone understands it is necessary. They are there not to punish clubs, they are there to help clubs. We don’t want to kill anyone, this is why we have a phased-in approach.” The rules will also forbid clubs owing money to their rivals, players and staff or the tax authorities at the end of the season.
Earlier this year, Infantino estimated 50% of clubs in Europe were making losses and 20% were in financial peril. Big transfer fees can still be paid but clubs will need to generate sufficient funds through ticket sales, TV money and commercial revenue. The European Clubs’ Association’s president, former German international Karl-Heinz Rummenigge, welcomed the move, commenting: “The measures will shape the future of European football into a more responsible business and ultimately a more sustainable one.”