Summary
Since it was formed in 2010, Financial Fair Play (FFP) has shaped how football clubs operate. No longer are they permitted to spend as freely as they please, as governing bodies such as UEFA and the Premier League seek to prevent clubs from going under through financial mismanagement.
But how does it really all work? How are clubs getting into trouble and what are the potential sanctions available to be handed out to those who break the rules? These are just some of the questions Football FanCast will look to answer as FFP scandals threaten to dominate conversation once again.
Football clubs have been affected by FFP since 2010. UEFA and the Premier League limit club expenditure to prevent financial mismanagement.
All works, but how? How are clubs breaking rules and what are the penalties? Football FanCast will examine FFP controversies as they reappear.
FFP and its origins
UEFA introduced FFP in the early 2010s to ensure that clubs competing in its championships were not spending more than they made. This protected the game’s credibility and clubs from financial collapse.
Three-year breakeven was the goal for clubs. UEFA allows clubs to lose up to €30m – £25.7m, depending on where the money comes from, but there are rigorous limits to prevent teams from spending millions without consequence.
UEFA invests heavily in the future. Losses do not include infrastructure and youth development spending. The authorities will watch on excessive player expenditure.
Premier League FFP rules
In 2015/16, the Premier League implemented Profit and Sustainability Rules (PSR) FFP criteria. The principles are the same as UEFA’s, but the parameters vary greatly.
Clubs can lose £105m over three years. Clubs must also report their financial results annually to prove they can balance the books.
If a club breaks the regulations, an independent commission decides their punishment.
| Active FFP investigations – Premier League | ||
|---|---|---|
| Club | Date charged | Punishment |
| Everton | March 2023 | Ten-point deduction (pending appeal) |
| Everton | January 2024 | Decision by 12th April |
| Nottingham Forest | January 2024 | Decision by 12th April |
| Chelsea | n/a | Investigation ongoing |
| Manchester City | February 2023 | Investigation ongoing |
Previous FFP penalties
Most recently, Juventus was expelled from the Europa League and fined over £20m for financial infractions.
Milan were banned from the Europa League before the 2019/20 season for an FFP violation that left them in the red for three years.
Last year, they successfully appealed to the Court of Arbitration for Sport (CAS) against a similar ruling, which exonerated the San Siro giants for their disproportionate punishment.
Last summer, UEFA fined Chelsea and Manchester United in the Premier League.
United were fined €300k (£257k) by UEFA in July for a “minor” FFP infraction, which appears to have been a miscalculation of losses between 2019 and 2022, a time heavily hit by the epidemic.
Later following month, Chelsea were fined €10m (£8.6m) for “submitting incomplete financial information” between 2012 and 2019, which was unrelated to their lavish spending since Todd Boehly arrived at Stamford Bridge.