Hi Pavel,

I'm no football economics expert either but you are correct in summarising the FIFA Financial Fair Play rule as a club is not allowed to spend more in transfer signings, wages, etc. than what they earn through television, tickets, and commercial incomes (with a 5 million euro leeway). I'm going to take a guess here and say you are hinting towards PSG's summer signings? Their Neymar and Mbappe signings have actually triggered a UEFA FFP investigation, which isn't PSG's first time as they were fined back in 2011. If FFP is considered breached by a club, UEFA can administer fines, withhold winnings or even reduce roster sizes as they have done to Manchester City for the Champion's League in the past. It seems that the general opinion of the UEFA FFP is that they are "all bark with no bite" and only seem to hand out slaps on the wrist. The UEFA website has a nice FAQ section on FFP, which I have linked to below.

Hope this helps!

-Kenneth

http://www.uefa.com/community/news/newsid=2064391.html

Hey Kenneth,

good to hear from you. Are you actually in Canada or still in Europe? Thank you very much for your comment. The link is cool. I think, the big clubs will alwasy find a way to bend the rules. Where the money is is often a way. Maybe take also a look at the page of my former colleague @Mathias Schubert here on RG. He wrote an interesting paper on FFP. Hope to see you soon somewhere...

Best,

Pavel

Hi Pavel,

Thanks for referring this to me. FFP sparks interest even more after what has happened thi summer. :-)

Anyways, whether FFP works or not can only be assessed against what the policy was intended to address. Besides other aims, the major objective was to curb the increasing loss-making of clubs. So if you look at FFP against this background, UEFA needs to be congratulated for what is has achieved, as losses have significantly decreased since.

FFP is often criticized for its name. At first, it appeared as a clever marketing move to label the policy FFP because fair play is a universal value of sport, and why should it not also be a matter in financial terms? On the other hand, fair play is, of course, inevitably linked to the idea of equality of opportunity and a balance of competition. So, even though the latter is explicitly not a declared goal of FFP, still the policy is being criticized for that.

If the concept had not received such an ideological underpinning by the naming as well as the corresponding rhetoric of the then UEFA leadership, there would be much less debate today, I would assume. A more technical name in the sense of "concept for securing sustainability and financial stability" would probably have been less problematic, retrospectively.

I believe that PSG have found a creative loophole in FFP. It is not possible that a policy can regulate every little detail though. It is now up to UEFA to decide on whether PSG is adhering to FFP. Also the fact that a club can depreciate (or amortise) transfer fees evenly over the length of the contract helps clubs to be in line with FFP.

It will certainly remain interesting to observe how UEFA will assess this case.

Cheers,

Mathias