Is the FFP system justified?

[Thunder Bolt]

I must admit I do not know the full details. What happened to all those loan players they had last season? Did they sign them all on permanent contracts?

I'm not sure how many they signed, tbh, a couple of them I think.

 

[Surf's Up]

I guess the original concept was fine, it helped to protect clubs from their own instincts to piss money up against the wall. It only works effectively if there is a level playing field and all clubs obey the rules and hence the problem because with parachute payments and clubs like Forest and Watford finding ways around the rules they've agreed to the only mugs are the clubs genuinely applying FFP!!

 

[Surf's Up]

So they now 'buy' their players from Granada and Udinese, for a knock down nominal price. All with the rules, of course.

I think Watford "purchased" about 12 players (market value probably in excess of £10m) from their Chairman's other clubs Granada and Udinese for nothing!

 

[KZNSeagull]

FFP was set up as a means of trying to restrict the growth in player wages in the Championship, L1 and L2.

In the PL and Champions League the intention is to preserve the self perpetuating cartel who qualify for the Champions Lseague each year, and prevent another Manchester City being created that upsets the applecart.

There will be legal challenges, both to FFP, but perhaps more intriguingly to the existence of the transfer system.

Pray tell us more, Sir!

 

[nwgull]

I guess the original concept was fine, it helped to protect clubs from their own instincts to piss money up against the wall. It only works effectively if there is a level playing field and all clubs obey the rules and hence the problem because with parachute payments and clubs like Forest and Watford finding ways around the rules they've agreed to the only mugs are the clubs genuinely applying FFP!!

Lets get this straight: Forest have not found a way around the rules; they're blatantly contravening the rules regarding fair value of a sponsorship deal between the club and a related party. It remains to be seen whether or not they are punished, along with any other clubs who break the rules. Only then can we say whether or not it's an effective system, not 2 months into the first season!

Edit to add: I think it's a bit harsh to call club owners mugs for not wanting to pour £8m+ out of their own pockets season after season!

 

[Herr Tubthumper]

I think Watford "purchased" about 12 players (market value probably in excess of £10m) from their Chairman's other clubs Granada and Udinese for nothing!

Given the FFP rules I presume the value of these players will be investigated when Watford publish their accounts then.

 

[seagullsovergrimsby]

I think Watford "purchased" about 12 players (market value probably in excess of £10m) from their Chairman's other clubs Granada and Udinese for nothing!

The players will have been signed for nominal fees and not their true value. One loophole is closed and another one is found.

 

[nwgull]

The players will have been signed for nominal fees and not their true value. One loophole is closed and another one is found.

As tub thumper has suggested: you'd hope that these players fair market value will be assessed when it comes down to the nitty gritty of clubs submitting their accounts for 13/14 in December next year.

 

[Urchin]

The easy response is that in theory, it sounds good and should work. But it won't ever work whilst teams receive parachute payments.

 

[nwgull]

Moaning that teams receive parachute payments is like moaning that Wigan will have a few extra million to spend for winning the FA cup last year. The rules are there and clear for all teams to see; parachute payments are effectively a very good bit of prize money for achieving promotion to the premier league.

How would everyone feel if you got your wish and they were abolished the season that we got promoted?

 

[El Presidente]

Pray tell us more, Sir!

The lawyer who worked on the Bosman case has indicated that he wishes to take a case on behalf of a client to court. The rationale is that under EU law an individual is free to work wherever (s)he wishes as there are no employment barriers.

UEFA have argued that the football industry is a special case, and the business model upon which many clubs depend would be destroyed, sending many clubs under, if they could not generate income from transfers.

 

[Thunder Bolt]

I think Watford "purchased" about 12 players (market value probably in excess of £10m) from their Chairman's other clubs Granada and Udinese for nothing!

It's worse than I thought.

 

[Triggaaar]

I think Watford "purchased" about 12 players (market value probably in excess of £10m) from their Chairman's other clubs Granada and Udinese for nothing!

If that's allowed, all clubs need to do is use a small intermediary club - for example, Brighton could own Hassocks FC (or the equivalent abroad if necessary), buy a player for market value, and then sell him to Brighton for £1. Hassocks wouldn't even need to be in a league, so no rules for them to follow.

 

[Herr Tubthumper]

The lawyer who worked on the Bosman case has indicated that he wishes to take a case on behalf of a client to court. The rationale is that under EU law an individual is free to work wherever (s)he wishes as there are no employment barriers.

UEFA have argued that the football industry is a special case, and the business model upon which many clubs depend would be destroyed, sending many clubs under, if they could not generate income from transfers.

The Bosman lawyer is looking into the UEFA FFP, not the FL FFP. The two are different, the crucial difference being the FL rule is a self-imposed rule. The UEFA rule is not. A group of clubs voting themselves to adhere to contain loses is no different to a boardroom voting to do the same thing. Perfectly acceptable and within EU law and goes on every day across the EU.

Also, UEFA FFP does not affect us.

 

[Triggaaar]

The lawyer who worked on the Bosman case has indicated that he wishes to take a case on behalf of a client to court. The rationale is that under EU law an individual is free to work wherever (s)he wishes as there are no employment barriers.

What about the music industry, where artists sign a contract for a record label - should they be able to just leave and work somewhere else? What about when someone works for one company, and signs an agreement that they won't work for a competitor for a certain length of time - should none of these agreements mean anything?

 

[Herr Tubthumper]

If that's allowed, all clubs need to do is use a small intermediary club - for example, Brighton could own Hassocks FC (or the equivalent abroad if necessary), buy a player for market value, and then sell him to Brighton for £1. Hassocks wouldn't even need to be in a league, so no rules for them to follow.

See posts 26 and 28.

 

[El Presidente]

What about the music industry, where artists sign a contract for a record label - should they be able to just leave and work somewhere else? What about when someone works for one company, and signs an agreement that they won't work for a competitor for a certain length of time - should none of these agreements mean anything?

Performing artists have contracts to deliver a product, usually X albums, which must be deemed to be of a commercial quality.

 

[El Presidente]

The Bosman lawyer is looking into the UEFA FFP, not the FL FFP. The two are different, the crucial difference being the FL rule is a self-imposed rule. The UEFA rule is not. A group of clubs voting themselves to adhere to contain loses is no different to a boardroom voting to do the same thing. Perfectly acceptable and within EU law and goes on every day across the EU.

Also, UEFA FFP does not affect us.

My understanding is that the Bosman lawyer is working on behalf of an individual player, and has nothing to do with FFP.

 

[Goldstone Rapper]

Much has been discussed about the effects of FFP on the behaviour of clubs and what further measures need to be taken to achieve real FFP.

What I haven't seen is much discussion as to whether or not the system itself is justified and whether or not it infringes on individuals rights to run the clubs they own in the way want.

If I decided to set up a business making and selling widgets as a hobby then there is nothing to stop me buying an existing widget company, spending as much as I want to buy the best possible manufacturing processes, offer as high a pay structure as I want in order to get the best possible production staff and the best possible sales force.

I could sell those widgets at a loss, undercutting the opposition and becoming the biggest and best widget seller in the country - nobody can turn round and say you can't do that. So long as I have the financial substance to carry this out then I can pursue my hobby without interference.

Surely that's not strictly true? The Monopolies and Mergers Commission (now the Competition Commission) is meant to have a say in this. We may agree or disagree to the extent that it's a powerful body or not, but to say 'nobody can turn round and say you can't do that' is a stretch of the truth.

Of course, laws are sometimes flouted. Even so, everyone is subject to the laws of the land - no one can run a business in the UK exactly as they please (e.g. You can't use torture in the workplace and reasonably claim that anyone trying to stop this is infringing upon your individual rights).

The principle of FFP is a good idea, because it stops clubs running a massive loss to get an unfair advantage. The problem comes when clubs aren't reducing their spending to manageable levels but try to maintain existing levels by fleecing fans of more of their money to balance the books.

 

[Creaky]

What about the music industry, where artists sign a contract for a record label - should they be able to just leave and work somewhere else? What about when someone works for one company, and signs an agreement that they won't work for a competitor for a certain length of time - should none of these agreements mean anything?

Does the music industry, or any other for that matter, have a system whereby employees contracts are routinely transferred from one company to another for a negotiated fee? - I can't think of any.

Football, and some other team sports, have a strange employment system. Fixed term contracts mean that the club knows what it will cost them to terminate the contract but the player doesn't know how much the club can demand if they want to terminate it or even if the club will be willing to allow the player to do so. That seems intrinsically unfair and leads in some cases to exorbitant transfer fees. If the cost of terminating a contract was the same for both parties this would end some of the more ridiculous transfer fee demands, it would also close the "feeder" club loophole in the FFS.