Manchester City could spur a salary cap if they win the Champions League UEFA is brewing a new FSR for the Premier League
News on June 1, if Manchester City win the Champions League, a predictable result is that it will stimulate UEFA to quickly introduce a salary cap system.
A year ago, in the summer transfer window, Premier League spending totalled €2.24 billion, almost equal to spending on the other four major leagues, La Liga, Bundesliga, Serie A and Ligue 1 combined (€2.297 billion).
It is predictable that something similar will happen with transfers this summer. After all, in the list of the richest football clubs, there are six giants in the Premier League in the TOP10 and 16 Premier League clubs in the TOP30.
Manchester City reached the final of the Champions League and West Ham United reached the final of the UEFA Europa League this season, after many previous seasons in which Premier League teams had performed well in European competitions.
Other leagues and UEFA are worried that if this development continues, the European competition will be dominated by Premier League teams! (When people talk about this topic, they tend to deliberately ignore the monopoly of the Bundesliga Bayern, Ligue 1 Grand Paris, and Premier League Manchester City on their respective leagues).
UEFA introduced the Financial Fair Play Rule FFP in 2010, which stipulates that a team's maximum loss between 2013 and 2015 can be 45 million euros, and the maximum loss between 2015 and 2018 can be 30 million euros.
UEFA has fined Manchester City and Paris Saint-Germain. The suspension penalty imposed on Manchester City was overturned by the Court of Arbitration for Sport, and in the end, a fine of 10 million euros was hastily imposed.
The implementation of FFPs weakened during the pandemic and have since been gradually abandoned and replaced by new controls.
UEFA's latest financial management method, the Financial Sustainability Regulations (FSR), can be called the "Sustainable Finance Rules", the core of which stipulates that the proportion of team transfers and salary expenses in the team's income decreases year by year until it reaches 70%.
2023 90%
2024 80%
2025 70%
But people found that there are also huge loopholes in this rule.
In the case of Manchester City, total revenue in the last financial year (2021-22 season) reached £613 million, an increase of £43.2 million over the previous year, and a net profit of £41.7 million. Among them, the matchday revenue is 55 million, UEFA broadcasting rights are 90 million, the Premier League broadcasting rights are divided into 160 million, and the most shocking is the commercial sponsorship income, which exceeded the 300 million pound mark!
Commercial sponsorship revenue is the problem, which includes the Premier League's 115 FFP violations against Manchester City. An affiliate of the Abu Dhabi Consortium coincidentally became a Manchester City sponsor, entering into a sponsorship agreement at a price above market value, and then realizing the blood transfusion of the Abu Dhabi Foundation to Manchester City Club. Manchester City has a wide range of sponsorship products, with as many as 49 sponsors!
Therefore, even if UEFA stipulates that team transfers and salary expenses account for 70% of team revenue, there are still loopholes for local clubs.
If Manchester City continue to expand commercial sponsorship revenue, such as reaching 350 million, and this season's Champions League goes further than last season, it is expected that the total revenue in 2022-23 may exceed 700 million pounds!
When Manchester City's total revenue reaches £1 billion (which is likely to be achieved in 2025 if left unchecked), and 700 million will be paid in salary (300 million now and even if it increases to 400 million in the future), Manchester City still have 300 million pounds for transfer operations. This is definitely unfair to clubs with absolutely low total revenue!
Manchester City has actually operated very smart in the transfer market in recent years, did not spend money indiscriminately, and sold players can be sold at high prices, such as Sterling, Zinchenko, Jesus, etc., and the net investment is actually positive. But Haaland's transfer fee figures are dubious, and it will take years to unravel.
Even if Manchester City has reached an absolute height through primitive accumulation, there is no need to spend money indiscriminately, but there is Chelsea behind!
Chelsea have spent almost £600 million over the last two transfer windows, and it could be crazy to leave it alone.
Therefore, UEFA is now learning from some professional leagues in the United States to try to introduce a salary cap similar to the NFL and NBA, that is, on the basis of FSR, add a total limit on team transfers and salary expenses, but a specific figure has not yet been negotiated.
The NFL salary cap per team is $224 million, and the NBA's salary cap is $123 million.
Chelsea's way of evading FFP controls is amortisation. For example, Enzo has a £100 million contract for 8 years, which is amortized to £12.5 million a year.
UEFA has also responded to this, with the new FSR rules stipulating that amortization is possible, but the maximum year is 5 years.
UEFA has been extremely cautious in introducing a salary cap rule, as it is likely to encounter opposition from players' unions.
England's lower leagues also experimented with a salary cap system, which was killed by the players' union. The lower leagues already earn less, and with a salary cap, the players will not be able to live!
When we watch from afar the formulation and implementation of a series of management rules of UEFA and the Premier League, it is inevitable that we will think of our own league Chinese Super League.
I advise all friends that you can learn some good experience, but it is better not to draw analogies and not to apply them.
Frankly speaking, Chinese football has been professionalized for 30 years, and today the Chinese Super League is still a pseudo-professional league, let alone learn advanced experience from other leagues!
Have you seen any club in the Chinese Super League announce its financial results for the 2020 season, 2021 season and 2022 season? Or, three seasons ahead, the most prosperous years of the Chinese Super League transfer?
No one has told fans what the club's share of broadcast rights, commercial sponsorship, matchday revenue is, at most it is to calculate the transfer expenses and income through the German transfer market website.
Take the current Dalian Renren Club as an example, who the shareholders are, who injected operating funds into the club, how much money the club earns, where the money is spent, and whether it owes wages or not, no one can give an answer.