UEFA to finalise new spending limit for European football clubs

A revamp of financial limitations in European soccer will be considered by top teams at a conference on Thursday, with spending caps rather than wage ceilings.

After more than a decade, UEFA is ready to alter its Financial Fair Play rules, which imposed losses restrictions.

Instead, teams in competitions such as the Champions League will eventually be limited to spending up to 70% of their income on soccer-related activities, according to sources familiar with the plans. The individuals spoke on the condition of anonymity because they were not allowed to disclose the plans, which are still in the works.

At an executive board meeting on Thursday, the European Club Association will evaluate the suggestions developed in collaboration with UEFA. The final guidelines are expected to be finalised at a meeting of the UEFA executive committee in April.

There are still concerns regarding inequalities in Europe, such as domestic tax regimes and social payments that could benefit clubs.

According to the New York Times, some clubs have been lobbying for the ability to spend up to 85 percent of their earnings. While the spending limit may be set at 90 percent at first, it would be reduced to 70 percent after that.

Overspending teams may be relegated from UEFA competitions ranging from the Champions League through the Europa League and the third-tier Europa Conference League.

If they are in good financial condition, they may be able to spend an additional $10 million above the cap for what is known as a sustainability bonus.

The modifications are intended to produce a sort of competitive balance and more sustainability for clubs while still providing a built-in advantage to the wealthiest clubs rather than closing the gap.

UEFA had been investigating pay caps, but their validity under European law was called into question.

Despite a decade of expensive player expenditure, Abu Dhabi-funded Manchester City and Qatar-owned Paris Saint-Germain have failed to win the Champions League.

The true worth of possibly inflated sponsorships tied to state-backed ownership will be key to laws relating expenditure to income, with both City and PSG benefiting considerably from partnerships linked to their Gulf ownership.

Nasser Al-Khelaifi, the president of PSG, is also the chairman of the prominent European Club Association, which has been negotiating with UEFA on new financial restrictions.

The Qatari is also a member of UEFA’s executive committee, which has yet to finalise plans for admission into the expanded Champions League, which will be increased from 32 to 36 teams beginning in 2024.

Two seats were planned to be allocated to teams based on prior accomplishment in Europe if they did not qualify through their domestic leagues, but that plan is currently in flux as a result of the wider ramifications from the Super League’s demise last year.