The UEFA Financial Fair Play Regulations was implemented to avoid clubs from spending more than they earned. The two essential ideas of Financial Fair Play are that clubs remains able to pay their debts (solvency), and the break even rule, the idea that a clubs “relevant income” must match its “relevant expenses” in the space of three years. However, despite the fact that Financial Fair Play aims to maintain overall financial health throughout European football, does it accomplish what it’s supposed to do and does it solves one of football’s biggest issues?

Fails to mitigate the financial gap

Ideally, the message of FFP is to “spend what you earn.” While on paper FFP looks to advocate for meritocracy (the teams with the most money are determined by merit.), it fails to mitigate the financial gap between teams. Despite the fact that Manchester United have not finished in the top 3 since 2013, because of the revenue they gather, they’re still able to financially compete with the elite teams like Bayern Munich, even though they haven’t experienced the success they used to for a while.

Despite FFP being around, the amount of money spent by clubs in each league continues to rise and the gap still fails to be reduced (Source: BBC Sports)

Lack of intervention

In the past few years even while FFP has been around, many clubs like Leyton Orient and Charlton Athletic have faced several debts, but the FA and UEFA have failed to take any action. But, it’s not even an issue of clubs’ privacy as UEFA has interfered in the past and fined Manchester City £49m for breaching FFP rules. Furthermore, for teams such as Leyton Orient and Charlton, the owners have brought more debt to the club, however, the fans and even the board have little influence in changing the future of the club. Because there’s a lack of intervention from UEFA, especially for financially-struggling lower league teams, many teams will continue to struggle and fail to reap the benefits of Financial Fair Play.

The inefficiency of implementing a salary cap

In US Sports, many teams have salary caps, however, it’s not as appealing as it sounds. A salary cap generally restricts spending on players to a fixed percentage of average club income, however, because each clubs’ resources and income differ, this simply means that all generally have reduced spending power. But while all clubs would have reduced spending power, the wealth inequality gap between teams simply would not be mitigated and would remain the same. Even the implementation of salary caps wouldn’t help the FFP as there are still too many loopholes in its regulations.

Because there’s no cap on wage or spending, Premier League clubs continue to spend more due to the higher demand, thus only increasing the gap between many clubs (Source: Deloitte Analysis)

50+1 Rule

In German football, there is a rule that states that in order to obtain a license to compete, a club must hold a majority to its voting rights, meaning that club members are the majority shareholders of the club. This rule prevents clubs from the influence of external investors, which could avoid the club from receiving more money from external investors, but also minimize the risk of the club being run poorly, as with the case of Arsenal and West Ham United. The owners of the following club have made many “empty promises” in the past and today, and as a result, many of the fans have decided to boycott games to condemn the acts of Kroenke, Sullivan and Gold. By implementing such a rule across several football clubs, many members and fans of the team will have more power and will generally be acting in the best interests of the future of the club, rather than maximising profits.