Due to the critical economic and financial conditions of many clubs, UEFA was required to establish any rules that could encourage more rationality and discipline in clubs’ management. The first step has been represented by the Club Licensing that first aimed to promote higher standards in European football by verifying compliance with any different criteria, which examine all main aspects of the business and, in particular, focus on the economic and financial situation of the firms. In a second time, UEFA intervened again to introduce the new Financial Fair Play regulations: they join the Club Licensing Criteria in order to improve the standards of football in Europe and guarantee sustainability for the entire business and long-term benefits for clubs. This paper aims to discover the main innovations of these new rules and, in particular, the importance the break-even requirement is assuming in the new discipline: all licensees, in fact, have to comply with the monitoring requirements in order to take part in UEFA club competitions. First of all, we tried to describe the new model by focusing on how to calculate the break-even result: this is not simply a comparison between operating costs and revenues, but the FFP regulations define it as the difference between relevant expenses and income. We discuss on the different costs and revenues that compose the two categories: the discipline identify exactly the relevant items to determine to result in the period over which the club is assessed, called measurement period. It also states that the break-even requirement will apply gradually starting from 2011/2012 season: the mechanism defined could include from two to five years depending on the economic results achieved by the clubs in the years before the competition start. Furthermore, the clubs don’t necessarily have to achieve a positive or at least null break-even result, but they’re allowed to spend more than they earn on the condition that the deficit stay within the maximum aggregate break-even deficit possible for a club, defined as acceptable deviation. Starting from balance sheets’ historical data, the paper simulates the application of the new break-even requirement to top Serie A Italian clubs showing how many of them comply with the new rules and how the others could eventually operate to fulfill the monitoring requirements. The last paragraph discusses on the goodness of this model that is first of all an important step forward to a progress in European football business and concentrates on any critical features, which can be improved to build a more solid model of business in this peculiar sector.

Il break-even requirement nella disciplina sul Financial Fair Play dell'UEFA

MANCIN, Moreno;Vezzaro, Paolo
2013-01-01

Abstract

Due to the critical economic and financial conditions of many clubs, UEFA was required to establish any rules that could encourage more rationality and discipline in clubs’ management. The first step has been represented by the Club Licensing that first aimed to promote higher standards in European football by verifying compliance with any different criteria, which examine all main aspects of the business and, in particular, focus on the economic and financial situation of the firms. In a second time, UEFA intervened again to introduce the new Financial Fair Play regulations: they join the Club Licensing Criteria in order to improve the standards of football in Europe and guarantee sustainability for the entire business and long-term benefits for clubs. This paper aims to discover the main innovations of these new rules and, in particular, the importance the break-even requirement is assuming in the new discipline: all licensees, in fact, have to comply with the monitoring requirements in order to take part in UEFA club competitions. First of all, we tried to describe the new model by focusing on how to calculate the break-even result: this is not simply a comparison between operating costs and revenues, but the FFP regulations define it as the difference between relevant expenses and income. We discuss on the different costs and revenues that compose the two categories: the discipline identify exactly the relevant items to determine to result in the period over which the club is assessed, called measurement period. It also states that the break-even requirement will apply gradually starting from 2011/2012 season: the mechanism defined could include from two to five years depending on the economic results achieved by the clubs in the years before the competition start. Furthermore, the clubs don’t necessarily have to achieve a positive or at least null break-even result, but they’re allowed to spend more than they earn on the condition that the deficit stay within the maximum aggregate break-even deficit possible for a club, defined as acceptable deviation. Starting from balance sheets’ historical data, the paper simulates the application of the new break-even requirement to top Serie A Italian clubs showing how many of them comply with the new rules and how the others could eventually operate to fulfill the monitoring requirements. The last paragraph discusses on the goodness of this model that is first of all an important step forward to a progress in European football business and concentrates on any critical features, which can be improved to build a more solid model of business in this peculiar sector.
2013
113
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10278/38993
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