FFP no longer under threat from legal cases – if it ever was!

By Tony Attwood

It is interesting that on this day – 23 July – we should be back to news about Uefa and FFP, for today is the anniversary of  the birth of Lt Col Sir Henry Norris, the man who financially rescued Woolwich Arsenal in 1910, offered the club debt free back to the fans in Plumstead and Woolwich, and when the fans chose not to support the club, built the Gillespie Road Stadium with his own finances, and moved the club there three years later.

Sir Henry has, as every Arsenal supporter knows, had a rotten press.  The fact that he replaced the previous benefactors who felt they could no longer support the loss making club, using his own finances, is ignored, as is the risk he took in building the new stadium on land he had obtained on a lease, meaning that had the landlord wished it to be happen, the club could have been thrown out at the end of the lease.

The true extent of his financial contribution (including paying off Archi Leitch, whose bill for the work on the Manor Ground was mysteriously missing when Sir Henry arranged to take over the club) is rarely considered.   Likewise his support for abandoning the maximum wage in football, and his opposition to the match fixing exploits of Man U and Liverpool in 1915, is rarely recognised – although the anti-Norris rhetoric was greatly enhanced by this affair.

Instead the story of Sir Henry as often told told today is that relayed by Arsenal’s most unsuccessful managers of all time – Leslie Knighton – in his series of scurrilous Sunday newspaper articles written 20 years after he was sacked by Sir Henry, and with Sir Henry long departed from this world, and unable to reply.  Tales of Sir Henry in some bizarre and unexplained way fixing the promotion of Arsenal in 1919 abound, even though for several years there has been a reward on offer for anyone who could come up with any evidence of any wrong doing at all.  The memoires of one of Arsenal’s most successful managers – George Allison – in his autobiography, (published simultaneously with Knighton’s story)which painted an utterly different picture of Sir Henry, were ignored.

What links Sir Henry Norris and FFP is the question of where Arsenal would have been post-1910 if FFP had existed then.  The answer is well within the rules.  Stadium building is still included as exempt from FFP, as is paying off old debts to stave off bankruptcy.  Post 1913 Arsenal were self-sufficient financially.

Now I thought of all that not just because today is the anniversary of Sir Henry’s birth but also because of the ruling today by the EC about FFP.

You might remember the headlines such as …

Financial Fair Play under threat: Brussels court case could potentially lead to rules being scrapped

Such headlines were all over the papers a short while back as, in the words of the Independent, “Manchester City’s hopes that Financial Fair Play  might be ruled illegal rest on a potentially hugely significant court case which opens in Brussels…”

The challenge, which we have touched on before, was put forward by Daniel Striani, and according to the press, was aided by supporters of both Man City and Paris Saint-Germain.

The group was represented in part by Jean-Louis Dupont, one of the lawyers who secured the landmark Bosman ruling.  The argument was that FFP infringes competition law and should therefore be declared illegal.

It was a curious case, not least because it became clear from the off that Uefa had the
support of the European Commission, which in October decided not to consider Striani’s case.  The EC’s overriding rule on sport is that sport is different and so has its own rules.  The Striani case seemed to want to overthrow this fundamental view.
Gleefully some of the press talked about years of stalemate and uncertainty in football citing the somewhat different case of the Portsmouth landlady who took on the Premier League, and how that went on and on and on.  But in reality there was so little chance of success in this case, none of it took very long at all.
On 23 September 2014, MCFC Supporters Club (1949) voted unanimously to join the legal actions against FFP led by lawyers Dupont and Hissel.  .

The legal argument in the Striani case was thus that the break-even requirement of FFP is in breach of article 101.2 of the EU Treaty.   The Man C fans argument stressed that because of FFP no new owner could develop a club as Man C had been developed.

The Court of First Instance in Brussels considered the case and were asked to refer the case before the Court of Justice of the EU.  They then requested a “provisional measure” to prohibit Uefa from moving into the second phase of the implementation of its “break-even requirement” keeping last year’s financial limits as absolute.
Among the complainants was Louis Smal, a former Belgian senator and former president of the Standard Liege football club supporters’ association who called FFP “a double punishment for major clubs in small countries who have been first penalized by the small size of their domestic market (which is the area of economic life imposed on them by the statutes of UEFA), and now see themselves deprived of a possible source of investment (i.e. the equity of their owners) and therefore potential sporting growth, thereby discouraging any prospective buyer from undertaking any ambitious plans”.
In the first hearing the Belgian Court found in favour of the plaintiffs.  As anticipated UEFA then appealed, an action which allowed them to continue with their current plans (something the newspapers seemed to have missed in their excitable discussions of potentially years of hiatus).
But yesterday Associated Press announced that UEFA was stating that the European Union’s Court of Justice had agreed with UEFA’s comment that a Belgian court’s request for a preliminary judgement was “manifestly inadmissible.”

The fact that the case went through a local Brussels court after the European Commission decided it had no merit had two implications, UEFA argued.  One was that yes the Belgium court to rule on the matter, but two, that had no impact on the workings of the EC.  If it had then “first instance” courts across Europe could cause havoc.


Here is a translation from the Belgium press today supplied by Walter…

The European Court of Justice will not investigate the rules of FFP that Uefa has implemented on European football clubs. A Belgian civil court from Brussels had sent the case to Luxembourg a month ago.

The European court of Justice has found the request manifestly inadmissible because the court in Brussels declared itself incompetent in this case. On top of that the Belgian court didn’t give the needed evidence to support the case. Therefore the European court in Luxembourg has scrapped the Striani-case from their agenda.

And so, one may say, that’s that, at least until someone else has more money to throw at the case.

If you are interested in the case of Henry Norris at Woolwich Arsenal you might enjoy

which covers the period from 1893 to 1915 and examines the takeover of the club in 1910 in more detail than published in any other book, as far as I know.



21 Replies to “FFP no longer under threat from legal cases – if it ever was!”

  1. Hasn’t UEFA giving up on ffp now. If so it’s very disappointing as it actually looked like they were serious and it would work.

  2. Ragingclue84, some adjustments have been made for possible new owners but for the rest things stand as before. Now even more.

  3. I wonder how much space, if any the UK media know everything there is to know gods will give to this important news.

  4. Fantastic article.

    It is clear that the press, as much as anyone, want FFP to fail.

    The argument that FFP is monopolistic comes from supporters of some of the biggest oligarchs in the (football) world and this irony seems to have escaped them, and the press. What is more restrictive, everyone spending within their means (with some leeway for investment) or more and more of the talent in the world of football, goes to a select few.

    By the way, if sport weren’t different, I don’t see how we could have 25 man squad limits, transfer windows, homegrown quotas, and above all the structures of PGMO, PL, FA, UEFA, and FIFA themselves. The fact is sport is different to other industries, and while there is no perfect system, a system that caps spending is more democratic than the other option. The option that, unfortunately, all City fans seem to think is ‘just’. The Billionaire’s oligarchy.

  5. The bottom line is: would people prefer a situation where:

    1. All clubs live – more or less – within their means; or

    2. New owners can come in and spend (invest is the wrong word) money significantly beyond the club’s means out of their own pocket?

    Under 1 it means the existing hierarchy will evolve very slowly but that, provided the existing differential is not too big, the clubs in positions 2,3,4… will have a sporting chance of success on any given day or even season. Although Man Utd are the biggest beast in England they have not been historically dominant with the partial exception of the (mid) Ferguson years. Scotland/Spain/Germany are slightly different situations with either a monopoly or duopoly.

    Under 2 it means the hierarchy can be temporarily upset (temporary in that the rich backer may cease to support the club – but that attracting new supporters so enabling organic growth is a very long-term thing), often in an extreme way.

    Prior to their benefactors, Chelsea and Man City were of a middling-PL size. Certainly behind Man U, Arsenal, Liverpool, Sp*rs – and possibly behind the likes of Everton, Newcastle and Aston Villa.

    Even after several years of significant success I don’t think their support base, particularly substantive support in the UK (i.e. those who attend games) has grown that much. Chelsea and Man City don’t always fill their stadiums.

    Clearly the press prefer the rich benefactor model as it means far more money is thrown around and, I suppose, the overall quality of players in the Premier League is higher.

    Obviously the supporters of clubs like Arsenal, Man U, Liverpool and Spurs would prefer a self-sustaining scenario – but I am not sure about the supporters of clubs like Aston Villa, Swansea, Norwich and so on. My sense is they don’t like the benefactors as it knocks them further down the pecking order, but I’m not completely sure.

    However I believe that a significant majority of English fans do NOT like the rich benefactor model as practiced at Chelsea and Man City (and briefly at Blackburn before them).

  6. Let the soul of Arsenal bailer, Lt Col Sir. Henry Norris rest in total peace. Amen. If it hadn’t been for his bailing out Woolwich Arsenal from financial problems, the Wooliwich Arsenal which later became the Arsenal FC of today wouldn’t have been existing. The FFP amendments are now making it possible for the Heavy weight money sponsored clubs to start buying players they want all over again under the guise of new investors ploy. Those big cash sponsored clubs can afford to throw in money into the transfer market to get any player they want no matter the cost. Arsenal cannot afford to throw in that kind of £50m – over £60m of money into the transfer market lavishly to buy a target. We all know why they can’t afford that kind of over the odds market price. No billionaire owners give their own money to AFC to buy players. The 2 Arsenal majority share holders don’t do that and are likely not to do such. AFC are making their money purely as a business liability company, Plc. This handicap of not been able to compete at the market along with the rest of the top or giant clubs is now showing as the Boss is yet to sign 2 top quality players of a left back and a right winger which I have suggested to him to buy through the internet press media. Can one imagine, PSG are now rumourly reported to be interested to sign Arsenal RW target, Aubameyang. I wouldn’t know if at all he’s been targeted by Arsenal. But if Arsenal have, PSG may get him because Arsenal may not afford his likely over hyped price tag which PSG wouldn’t mind to pay. I think the Gooners should take note of this financial factor before they start accusing the Boss of not buying big caliber players yet in this summer. However, I believe the Boss will manage to pull the buying trigger soon.

  7. Pete

    In my view, any football fan should support a self financing model. Failing which it has to be the US model where it’s billionaire bankrolled, but with capped salaries, and owners making profits. Those two are the only models that can be sustainable in the long run.

    With the billionaire model, it does not open up the hierarchy, except in the immediate term, as it’s done now. If allowed to continue, no club can ever hope to live with that kind of expenditure. Not that that’s the only reason, but look at AC Milan, a storied club, selling players in their prime, to the Qatar funded PSG some years ago.

    Now, sure, its supporters point to that as a sign of ‘fresh blood’. Except, the bigger clubs are not just suffering, they are also forced to compete and go ever further in their spending. At least for a while, the big clubs can hope to live with them. But this entails higher ticket prices because clubs can legitimately claim they need the money to pay the ever increasing players wages and agents fees etc.

    Even in the immediate term, the billionaires haven’t broken up any hierarchy. They’ve muscled their way into it, expanded it and taken it even further away from the rest of the clubs. They’ve exacerbated the problem that exists, not solved it. And this will only get worse if unchecked.

    Now that’s not to say that the current self financing model works perfectly. ie, the CL money has grown big enough to cause its own disparity. However, a) the new EPL TV deal should make this slightly less of an issue for English clubs, because the gap isn’t as high in percentage terms (or absolute terms)

    and b) there should perhaps be a discussion on the distribution of CL funds.. Maybe give a percentage to the leagues directly, based on performance of the clubs. So if English clubs don’t do well in the CL, the whole league gets paid less. (Does this already happen? German and French leagues help their CL clubs with scheduling)

    In the end, we want a competitive league, with stable clubs, quality players, at affordable prices. All of it is a balancing act. The billionaire model doesn’t just upset the current balance. It destroys any chance at finding balance, with its reliance instead on chaos as the provider of fairness and poor management as basis of reward of being taken over by a billionaire.

  8. Pete

    Fundamentally, nobody likes 2 until they have one of there own.

    I get the impression a lot of people DO see it as basically unfair. The problem they have is they either, don’t see there Club ever breaking into the ‘elite’ without a benefactor themselves, or they don’t like the idea of how much hard work, and more over, how much time it will take, to get there without it.

    I think a lot see it as a catch 22 situation. Basically they don’t like it, they see it as fundamentally unfair, but deep inside they wish it was there Club that had the money. That to my mind is why they don’t jump up and down in disgust as much as they might, in deed as much as some of us do, because deep down they harbour dreams that one day it might be them.

    That’s where we differ, at least here on Untold, we DONT want it. That’s largely because we’ve already done the REALLY HARD part, the part everyone else is wary of. And we are fiercely proud and defensive of that.

    To me, the following is what lies at the root of why so many of us feel like we do about the arrival of the oil money, and that is because it was us it hit by far the worst.

    Under Wengers stewardship we had moved into 2nd spot behind United in the Premiership pecking order. We where the only Club who where really competing with them, either for the title or indeed the FA Cup.

    With a mind to mounting an even bigger challenge to Uniteds dominance we had committed to the building of a new stadium.

    Then the money arrived and it was us that took the hit. We dropped to 3rd, then 4th in the pecking order. We where now struggling to compete for the league OR Cups.

    When the money arrived nobody else suffered a downturn in there fortunes as we did, because hardly anyone else was winning anything anyway.

    I’m convinced where it Liverpool going head to head with United when the money arrived, and it was them that took the ‘hit’ in the way we did, the reaction the Chelseas spending would of been completely different.

    The media loved OUR noses being put out of joint. History tells us they would of been far less accommodating had there darlings Liverpool been on the receiving end.

  9. If, as appears likely, the demise of the FFP Regs is on the cards,(even before they could have started to bite) I wonder how this will eventually affect Arsenal FC with Messrs Kroenke and Usmanov, plus the African oligarch et al.
    I use the word “eventually” advisedly.

  10. FFP is here to stay.

    In the very short time the regulations have been in existence across Europe, club bankruptcies are down and the overall level of debts is way down.

    Although the latest regs have been portrayed as a relaxation of the rules, that’s far from the truth. Yes, more inward investment is now allowed. However, clubs will only be able to do so under strict conditions, and with constant monitoring. Also, clubs like Man City and PSG who have been sanctioned will NOT be able take part in these schemes.

    Lastly, a number of other regs have been tightened. The most interesting one is the tightening of the definition of inter-party transactions.

    Sounds boring, yeah? Well, it could have a lot of bite. Some examples:

    1. Man City transferred hundreds of employees from Man City to Man City Group.
    2. Man City transferred fixed assets (could be buildings, cars, equipment) also to the group.
    3. Man City and PSG have commercial income deals with Abu Dhabi and Qatar state-owned entities, respectively.

    1 and 2 reduce Man City’s costs. 3 significantly raise income. And ALL commercial income can be used to buy players – which is why such deals will be favoured by cheating clubs.

    A bit of crystal ball gazing now. I suspect that UEFA will introduce rules to prevent clubs gaining a significant competitive advantage by taking state aid of any form when building a stadium.

  11. @Robert,
    I wish I shared your optimism about the future of the FFP Regs.
    Unfortunately I feel that the whizzkid lawyers of the Big Boys will have the knowhow and financial muscle to ride roughshod through the Regs whenever they choose.
    I only hope I’m wrong. 😉

  12. nicky

    100% agree with you regarding your comment:

    “the Big Boys will have the knowhow and financial muscle to ride roughshod through the Regs”

    Because all I know is, when it comes to the ‘big boys’, the more they earn the less Tax they pay ! And if they can find loop holes, within loopholes, within loopholes, to avoid paying there dues to Her Majesties Government, I don’t see how a few FFP regulations are going to get in there way.

  13. Nicky, I agree that some clubs will try and get round the FFP regs. In fact, some have already tried. And they failed. And they were sanctioned.

    PSG is owned by the government of Qatar. They tried to get round the rules by having another government owned company give PSG a huge sum of money to be a commercial sponsor. UEFA sanctioned them.

    Man City, owned by a minor member of the Abu Dhabi ruling family, tried the same trick and a few others. They even hired the same major accountancy firm that drew up UEFA’s FFP regs. It didn’t work. They were sanctioned.

    Best of all, one of the Moscow clubs has been banned from participating in the next 4 UEFA competitions they qualify for.

    Now that a club has actually been banned, not just sanctioned, I’m sure the likes of PSG and Man City will tread very, very carefully. Bans would damage their egos in incalculable ways.

    As for Arsenal, the club has always managed its financial affairs in a sensible, sustainable fashion. Today, one of its directors told the Daily Mail the club has 200m quid in the bank, and Wenger can spend 100m on players if he wishes. I’ll bet there’s a reason behind the timing of the announcement.

    Check it out: http://www.dailymail.co.uk/sport/football/article-3172642/Arsene-Wenger-sign-wants-200m-bank-m-glad-didn-t-buy-Raheem-Sterling-says-Arsenal-director-Lord-Harris.html?ITO=1490&ns_mchannel=rss&ns_campaign=1490

  14. Robert

    “As for Arsenal, the club has always managed its financial affairs in a sensible, sustainable fashion.”

    That statement is certainly true but:

    “I’ll bet there’s a reason behind the timing of the announcement.”

    The only thing that can come from making a statement like that is that any player we may of had our eye on has just had another £10/£20 Million added to his price.

    What was he thinking of?

    Apart from the increased price of potential targets, all it does is heap more pressure on Wenger to ‘Spend the f***ing money’.

    The fact is, even if we do have that amount of money available for transfers, it wont change Wengers/Arsenals basic principles of not paying over the odds for players.

    It doesn’t suddenly make us Chelsea, City or United. We still have to balance books. We still have to think of ‘sell on’ value. We still cant just pay £40 Million for a player in his late twenties early 30’s without considering the fact that the money spent is almost certainly a write off on such a player.

    I’m not saying we cant, or in fact Wenger wont spend £40 Million, even £50 Million on a player, but he has to be the right player.

    Take for example Benzema, is HE the right player?

    Firstly, is he for sale?

    Secondly, if he is we are unlikely to be the only ones in for him. I believe the media are suggesting he might be the ‘mysterious’ target of LVG.

    Thirdly, does he want to leave Madrid?

    Fourthly, would he want to join Arsenal, given United would probably be in for him, and they are, like it or not, still a bigger draw than us.

    So in a bidding war would £40 Million get his signature? Probably not, so how far should we go? After all we’ve got £100 Million burning a hole in our pockets and you know what people are like.

    SPEND THE ******* MONEY.

    But Arsenal WILL NOT pay over the odds.

    That’s what makes your 1st statement above so relevant.

    Lets say all the criteria above are met. IE He wants to leave, he wants to come to us etc. and we can get him for say £40 Million then perhaps it would happen. But Wenger will NOT just pay whatever it takes, and you know that’s just what some of the more vociferous of our fans think SHOULD happen.

    All statements such as Lord Harris’s do is arm our many detractors with the bullets to fire at Wenger when we don’t land one of the many targets they say we have.

    Anyway, having seen Wengers press conference today it doesn’t look like Benzema is going anywhere anyway, least of all us. Apparently Benzema stated he is 1000% certain he is staying at Real Madrid, to which Wenger said ,”that sounds pretty certain to me”. And Rafa Benetez also said Benzema is going nowhere.

    Just one more little point:

    Season 2014 2015, all competitions:

    Benzama: Played 46 scored 22

    Giroud: Played 36 scored 19

    League only.

    Benzema: Played 29 scored 15

    Giroud Played 27 scored 14

    Girouds stats stack up pretty well against Benzemas, especially as Giroud is playing in the ‘toughest’ League in the World.

    But as we all keep getting told, Giroud is not ‘World Class’ where as Benzema is.

    Perhaps if Giroud had cost £40 Million as opposed to just £10 Million then he would be World Class.

  15. Jambug, if Harris made that statement without the prior knowledge of the rest of the board, then no doubt he’ll get a royal rollicking.

    However, Arsenal are normally very careful when it comes to dealings with the press, so it remains possible that the full board were aware in advance – and saw an advantage. Wenger didn’t dismiss the statement outright, he merely toned it down.

    No matter what, Wenger won’t be pressurised by anybody, and the club won’t pay over the odds for any player.

    As for Giroud, I agree that he’s hugely underrated. His stats also compare favourably to Lacazette once you take penalties scored out of the equation.

  16. Robert

    We have had this kind of statement before from a member of the board, namely Dennis Hill Wood, and all it did then was to give ammunition to the ‘spend the f**ing money’ brigade.

    As then I doubt very much it has anything to do with ‘Miss Direction’ or ‘vapour trails’ or any such machinations, but of course you could be right. In fact I really hope you are, otherwise it’s just a glorious, and totally unnecessary own goal.

    Either way I agree it wont effect Wenger. He’s had far worse than this to deal with, it’s just if it is a ‘faux pa’ it is one he could of well done without.

    I’m pleased you agree about Giroud, but apparently the stats mean nothing.

  17. Will,

    You’re not kidding. I’m looking forward to the day that Tony or Walter pen an article about FFP that is accurate but there’s less chance of that happening than me getting a nosh off Kim Kardashian!

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