Friday, 16 May 2014
How will UEFA's Financial Fair Play sanctions affect MCFC?
We all know FFP is an abhorrent policy, as explained here, yet the sanctions UEFA have imposed upon Manchester City Football Club, does not impact the Citizens too much.
THE €60M FINE
Most media outlets have reported a €60m fine for the Blues, but the punishment is much different. In fact, City lose €20m (combined) of its share of income from UEFA for competing in the their competitions during the 2013/14 and 2014/15 seasons. The remaining €40m withheld is also prize money, but is expected to be handed back to the Blues this time next year, when they show they have complied with FFP regulations during the 2013/14 season.
So in essence, City have lost €20m, whilst almost certainly regaining the other €40m since the Blues expect to comply with the regulations and break-even in 2013/14.
ALLOWANCE OF LOSSES
This won't affect the Blues really. City have announced they expect to break-even after 2013/14 and operate in profit thereafter. As such, the allowance of losses doesn't even matter.
CHAMPIONS LEAGUE SQUAD LIMIT
It's just a squad limit of 21 players and has no bearing regarding home-grown talent. City used only 21 players in the Champions League last campaign and so the sanction doesn't really affect them.
TRANSFER BUDGET LIMIT
If City's rumoured transfer exploits are to be believed, then Sheikh Mansour's club will spend £41m on Porto pair Eliaquim Mangala and Fernando whilst Arsenal defender Bacary Sagna is expected to arrive at the club on a free. Therefore, the Blues will not be affected by the £49m limit imposed upon them.
Should players such as Scott Sinclair, Micah Richards and Costel Pantilimon leave for a monetary fee, then that can be added onto the limit. If City sold the trio for £10m, then they will have a £59m limit.
For reference, the Blues spent £67m net last summer and therefore, don't expect the limit to be too much of a problem.
THE WAGE BILL
UEFA say that the Citizens' wage bill must not increase during 2014/15. With players such as Joleon Lescott, Gareth Barry, Scott Sinclair and Micah Richards expected to be off the wage bill, City again will not be affected. UEFA say they ignore bonuses too, which is heavily featured in contracts drawn up by CEO Ferran Soriano.
As such, the Blues again should not be affected.
ADDITIONAL
Furthermore, if players are signed this campaign, their transfer fees are not all piled in to one season's FFP report. They are divided between however many years that signing's contract lasts for. For example, Martin Demichelis joined the Blues for £3.5m and has a two year deal. Therefore, £1.75m is incorporated into 2013/14's financial report and a further £1.75m into 2014/15's.
Hope that clears a few things up.