When the UEFA Executive Committee approved the financial fair play concept at its meeting in Nyon on 21 September 2009, it intended that new regulations would improve not only financial fairness in European competitions, but also the long-term stability of European club football.
The results to date show how important that decision has been. Losses across European club football are down by two-thirds since the introduction of financial fair play, overdue payables are down by over 90%, and in a marketplace where the revenues of top-tier clubs have doubled since 2002, revenue growth is now ahead of salary growth for the first time, according to the figures for 2014 (5.8% compared with 3%).
Additionally, with European clubs now generating the highest-ever combined operating profits, there has been a reduction in net debts within the sport, matched by substantial investments in youth development and infrastructure. Thus, financial fair play has put European club football on a more stable footing, and the regulations governing the principles are now part of every club's decision-making process.
Equally, the regulatory framework needs to keep pace with developments in the football sector. Thanks to a thorough consultation process involving UEFA member associations, clubs and leagues, the new UEFA Club Licensing and Financial Fair Play Regulations provide the platform for both an expansion and the strengthening of the financial fair play process for the future.
The updated regulations include a reduction in the maximum aggregate break-even deficit or acceptable deviation from €45m to €30m, an easier determination of related parties, persons and entities, and a more stringent implementation of overdue payables criteria.
However, football needs to remain an attractive investment proposition, especially in relation to clubs undergoing a business restructuring. The introduction of the voluntary agreements will further allow clubs to develop a long-term business plan under the conditions set by the UEFA Club Financial Control Body and its monitoring process.
Overall, financial fair play rules have been strengthened and the reach of club monitoring expanded, and the new voluntary agreements mean clubs will be subject to club monitoring and must submit break-even data earlier and more often than previously.
Given its huge impact in improving business transparency and efficiency in only five years, a reinforced financial fair play regimen will ensure that European club football can build a more sustainable operating model for the future.