McHale & Co. Solicitors Blog


Football lawyer Andrew McHale says the Deloitte report into football is masking a massive change in the way clubs conduct transfer deals.

"Everything says the game is awash with money, or the availability of money, but it's deceptive. The effects of 'Financial Fair Play' are really affecting the market," said Andrew McHale, managing partner of McHale and Co, with bases in Cheshire and London.

"Fans of every Premier League club may see their team in the top 40 globally, but, in extreme cases, a Premier League club breaking FFP rules could even find itself demoted to the Conference if it can't pay fines associated with overspending or big debts.

"This has resulted in one of the weirdest transfer windows I've experienced, there are owners who want to spend money being prevented from doing so, with their finance executives and agents having to look at loan deals as an alternative to permanent transfers.

"If the Financial Fair Play shackles were taken off, then it would go completely mad from the top of the Premier League to the bottom. As it is, we'll never see an owner/investor-fuelled rise like Manchester City or Chelsea ever again, but, equally hopefully, never a Portsmouth-style fall either.

"There's a massive amount of money swilling around, but clubs are not splashing the cash because of the Financial Fair Play rules - which is confusing fans of the clubs which believe they can or should buy their way up the Premier League. Investors come into clubs sitting outside the elite half-dozen - who quite possibly have the resource to 'do a Man City' - but then discover they can't invest their own money in fulfilling their dreams and the dreams of the fans.

"People think FFP, and they think of Manchester City. But FFP applies right into the Premier League relegation zone, with some clubs fighting not just to avoid relegation, but also to avoid penalties for overspending or financial losses incurred in the Championship, and which come back into play if they drop back into the Championship.

"Fans are commenting on some of the seemingly weird deals going on, and are mystified by some of the decisions made. But quite often those deals and signings are the result of a combination of FFP spending limits and agents flexing their muscles by pushing up the wages for fringe players as part of a deal for a top player who the agent also represents. It also explains the number of loan deals with a future 'option-to-buy' - which is actually anything but optional.

"The upside is that clubs are now fast recognising the FFP ceiling is genuinely restrictive, and are developing academies aimed at nurturing home-grown talent. Money spent on academies doesn't count for FFP, and so whilst FFP was not designed to help the England team of the future, it could well end up doing more good in that regard than any number of FA initiatives."

Categories: Sports Law

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