Uefa could ban debt-ridden clubs

[Dellas]

Uefa general secretary David Taylor has warned that football clubs with heavy debts could be excluded from future European competitions.
Entry to the Champions League and Uefa Cup is subject to licences issued by European football's governing body.
And Taylor says clubs must address debts or face the "ultimate sanction".
"There would be forms of communication, even warnings or reprimands, before one got to a situation of exclusion but it is absolutely possible," Taylor said. Taylor was speaking at the Leaders in Football conference at Stamford Bridge.



On Tuesday, Football Association chairman Lord Triesman estimated the total debt of English clubs to be about £3bn.
Lord Triesman said the Premier League's four top clubs - Manchester United, Liverpool, Arsenal and Chelsea - are believed to account for a third of that debt.
However, Chelsea say their "unique ownership structure" means that monies owed are "internal and in the form of interest free loans from the owner that have no repayment time frame attached".

Taylor believes clubs with such huge debts are putting their future in jeopardy and feels they have to bring their finances under control.
"There is concern about these numbers, particularly in an era of financial crisis," Taylor told BBC Sport.





Uefa general secretary David Taylor

"Debt in itself is not necessarily a bad thing. Just because I have a mortgage it doesn't mean I'm bankrupt. But the debt does have a requirement to be properly serviced.

"Clubs must work within all available means and they must not expose themselves to such an extent that the whole future of the club is jeopardised unless some white knight comes over the horizon with millions and millions of pounds.
"That is a very dangerous and risky financial strategy for any organisation and as far as football is concerned we have to consider whether we should take further measures to regulate against that."

Taylor says making Uefa's licensing system more robust, and preventing some clubs from playing in Europe, could be one way of regulating their finances.
"We are looking at strengthening the minimum financial criteria and other forms of self regulation that may impose greater standard on clubs that want to compete in European competitions and, beyond that, club football," Taylor explained. "A situation where a club would not be allowed to compete in Europe would arise if a club didn't obtain a licence from their national football association.




"Club licenses are awarded every year and it's a requirement for clubs to have such licences before they compete in European competitions."
Improving the financial stability of Europe's leading clubs is one of Uefa's aims but Taylor admits it may take time for plans to achieve that to be initiated.
"It certainly won't happen next season but we've started with a working group to look at some of these issues," he said.
"Let there be no doubt that we're not sitting idly by, we're looking at increasing these requirements at some stage in the future."



Lord Triesman says the FA might consider enforcing a salary cap on Premier League clubs to help bring their debts under control.
"In the current climate it could be that we have to work out (wage) restraints and what they might be," Triesman added.
"A sensible form of (wage) restraint would make sense and it is not inconceivable. It's very hard to do anything unless all parties want to do it and everyone needs to want to do it. Preferably without being compelled."
But Taylor believes it would be almost impossible for Uefa to implement a similar system across Europe.

"A wage cap would be a very difficult challenge in Europe given all the different tax regimes and everything else that goes around that," he told BBC Sport.





"It's one of a whole number of ideas that needs to be more seriously looked at than ever before but I think that would be one of the most challenging things to do."

Chelsea chairman Bruce Buck told the BBC that he thought the level of debt in football requires "a proper debate".
"I don't think you can, just by definition, say 'debt is bad'," Buck told BBC Radio 5 Live.
"Personally I don't think it's bad. Companies big and small borrow money and it is an appropriate business tool and I think football clubs are also entitled to use that tool.
"Debt per se is not bad but it's certainly has to be appropriate and reasonable in the circumstances."
Crystal Palace owner Simon Jordan believes working out a club's indebtedness is not a straightforward matter.
"How you judge the solvency of a club's balance sheet is very, very difficult because technically, most clubs could be perceived to be on the borders of being insolvent," he said. "Their assets are players. Sometimes the value of those players on the balance sheet is zero but the next day they could be worth £50m."

source: BBC SPORT | Football | Uefa could ban debt-ridden clubs

I'm not sure about this...does a debt ridden club have such a massive advantage that they should be blocked from playing in Europe? I personally don't know much on the subject but I think it would be a bad idea. How do you prove a club is in debt? By kicking out the big English teams surely you lose revenue etc.?

Is debt that bad? When you have an owner like Abramovich who can clear it all for you?

I don't know but lets get some more opinions and see..

[Dragoen]

I say yes kick the teams out how have massive debts. In Germany clubs have really tight restrictions on how much debt they can make and most are reducing them or they don't even have one. Whereas some spanish teams like Valencia have massive debts and the spanish federation doesn't give a shit.

Of course they loose money if they are thrown out of CL and in a less way out of the Uefa Cup/ Euroleague. But then they have to sell players reduce wages and actually start thinking about what they are doing instead of just throwing around money they don't have. Also Fifa should introduce a rule on debts so that there is equal rights in every league.The way it is now it is disadvanting teams who think before doing something.

[azzurri]

Originally Posted by Dragoen

I say yes kick the teams out how have massive debts. In Germany clubs have really tight restrictions on how much debt they can make and most are reducing them or they don't even have one. Whereas some spanish teams like Valencia have massive debts and the spanish federation doesn't give a shit.

Of course they loose money if they are thrown out of CL and in a less way out of the Uefa Cup/ Euroleague. But then they have to sell players reduce wages and actually start thinking about what they are doing instead of just throwing around money they don't have. Also Fifa should introduce a rule on debts so that there is equal rights in every league.The way it is now it is disadvanting teams who think before doing something.

I agree. It's the same in Italy, and clubs get deducted points or relegated every year because of it.

All club's live off credit and take on a certain amount of debt, but what is happening now is much larger. Clubs are living well beyond their means, signing players with money they dont have. This is obviously an unfair advantage.

[Oliver_Kahn]

Originally Posted by Dragoen

I say yes kick the teams out how have massive debts. In Germany clubs have really tight restrictions on how much debt they can make and most are reducing them or they don't even have one. Whereas some spanish teams like Valencia have massive debts and the spanish federation doesn't give a shit.

Of course they loose money if they are thrown out of CL and in a less way out of the Uefa Cup/ Euroleague. But then they have to sell players reduce wages and actually start thinking about what they are doing instead of just throwing around money they don't have. Also Fifa should introduce a rule on debts so that there is equal rights in every league.The way it is now it is disadvanting teams who think before doing something.

I agree with everything you said, but I just had to vote 'no' because if this rule is created, it would mark the end of Portuguese football, seeing as the big 3 have massive debts (Porto ~ 90m, Benfica ~ 130m, Sporting ~ 190m) and rely on the CL money to make some profit every year. if that money stopped coming, they'd have to sell all their best players to be able to pay the salaries every month, the stadium, and all the other expenses a football club has.

as a neutral, I'd say yes. but this would destroy Portuguese football, so I say no.

[Evertonscouser]

G14 or whatever there called now would never ever allow this. The majority of their clubs would go bust if this was introduced. Its a nice idea in theory, but it would be really impossible to implement.

[azzurri]

I voted yes, but only because I agree with the idea of tighter financial regulations, and because it acts as a check on football management. None of us should trust people who handle big money. Their passion for the club is purely financial, and they could care less if it folds as long as they get their paycheck. Outright banning is a good deterence for new owners who look at football clubs solely as an investment.

[cianl1]

Well speaking from the Irish perspective, half the clubs in the Irish league can't afford to pay the player's wages, mostly because of the global finance trouble, and if a market implosion warrants preventing down-on-their-luck clubs from competeing in European competitions then I think I may have to resign my support in UEFA.