Financial fair play's positive effects

UEFA's financial fair play regulations are starting to have a positive impact on the European club football landscape – and European football's governing body has repeated that there is no turning back from the measures, which are designed to restore financial stability to the club game on this continent.

UEFA President Michel Platini, speaking in Monaco on Friday, said that financial fair play had the unanimous consent of all of Europe's major football stakeholders, which meant that UEFA was receiving crucial support in its drive to bring renewed financial well-being to soccer and curb the financial excesses of recent times.

"I repeat – we will never go back," said Mr Platini. "We took the decision to introduce financial fair play some years ago with the unanimous support of all the European clubs, the national associations, the politicians. This is something that is very positive, and we will continue."

The principal objectives of financial fair play are to introduce more discipline and rationality into club football finances, reduce pressure on salaries and transfer fees and limit inflationary effect, encourage clubs not to spend more than they earn, ensure clubs settle their liabilities on a timely basis, and protect the long-term viability of the European club game.

UEFA General Secretary Gianni Infantino explained that there had been a noticeable and potentially significant slowdown in transfer activity. UEFA's analysis confirmed that January 2012 was relatively much quieter than 2011 – transfer spending was down to €393m from the record €613m recorded in January 2011, a 36% decrease. There was only one completed transfer of more than €15m compared with nine in January 2011. A comparison between January 2012 and the January average between 2008 and 2011 also showed that activity was 20% lower than the average.

Summer 2012's transfer activity, ahead of the closure of the window in most countries today, showed that European clubs had so far transferred 18 players of €15m plus, compared with 26 in the full 2011 summer window and the record 33 in summer 2009. A total of €1,753m (€1.75bn) had been spent so far – considerably below the four-year full summer transfer window average of €2,249m (€2.25bn).

"The current winter and summer transfer spending of €2,065m is only 75% of the 2008–11 average," Mr Infantino said. "This underlines the impact of financial fair play and the fact that many clubs have overstretched or no longer have easy access to debt funding. These are clear facts and figures, and this is extremely significant."

However, Mr Infantino warned that while overall top-division financial losses had stabilised after recent years of acceleration, they were still at a historic and dangerous level. "It underlines the clear need for financial fair play," he said, adding that many clubs still had significant work to do in implementing new strategies in accordance with financial fair play.

UEFA has set up a Club Financial Control Body (CFCB) to replace the Club Financial Control Panel, which had monitored clubs since May 2010, with the main development being that the CFCB is a UEFA organ for the administration of justice. It also has the competence to impose disciplinary measures in the case of non-fulfilment of the requirements, and to decide on cases relating to clubs' eligibility for UEFA competitions. The body has a list of possible sanctions ranging from warnings, fines and deduction of points to disqualification from competitions in progress and/or exclusion from future competitions.

Mr Infantino said that the CFCB's monitoring activities were already having a clear impact. In 2011, all 237 clubs in the UEFA competitions had been monitored against overdue payables in June and September; ten clubs were referred to the UEFA Control and Disciplinary Body, and three clubs had been excluded from current UEFA competitions. This year, the 237 clubs were monitored against overdue payables by the end of June. There was a 47% reduction in amounts owed to employees, social taxes and transfer fees compared with 30 June 2011, and €36m had been paid by clubs within the two weeks prior to submission of documents to UEFA.

"The conclusions are that the Club Financial Control Body monitoring activity is having a clear positive effect," said Mr Infantino, "and that financial fair play is now well under way. There is only way – and this is forward."