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FFP Query


t_b

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Apologies if that has been covered before.  Tried searching but not found it.
Sure it has but hopefully that just makes the answer easier to share :)

Scenario proposal-

Bristol City are as they are now from a FFP perspective. Steve Lansdown is tiring of the long term project and would fancy a big time adventure before stepping aside. 

Steve wakes up and decides to go BIG and just bank roll a massive summer investment, with the sensible consideration of at least buying mainly players who could have resale value rather than aging mercenaries who have no value to sell on.
Everyone is by default on a 5 year contract to spread their depreciation. 

Two outcomes, promotion or staying in the championship.

If we flopped and stayed in the Championship what would be the likely FFP breach outcome? 

At what point can a club gamble that any FFP punishment is not a risk? 

 

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In our current position, we will be under some form of reporting / monitoring, so going gung-ho this summer isn’t an option, not in terms of fees anyway.  And by fees I mean total spending £30-40m with contracts over 5 years.  EFL would probably decline registrations.

It is expected that new FFP regs are coming in for next season, but real-time / more regular reporting of finances will be part of it.

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10 minutes ago, tommy_b said:

Has this happened previously for anyone yet? I mean actually putting clubs on an effective transfer embargo without notification? 

But it is a notification. The clubs know the rules, and if they break them then they know the likely outcomes. We are in constant dialogue with the EFL and the financial reporting unit. 

As to being unable to register a player that a club has "signed". It happens commonly. Two recent high profile examples (admittedly not in this country) are Ronaldo at his Saudi club, and I think it was Lewandowski and a couple of others at Barcelona in the summer. Different reasons for those two examples, but the are examples of national federations refusing to process a registration because the club has breached local financial or other rules.

Edited by ExiledAjax
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7 minutes ago, ExiledAjax said:

But it is a notification. The clubs know the rules, and if they break them then they know the likely outcomes. We are in constant dialogue with the EFL and the financial reporting unit. 

As to being unable to register a player that a club has "signed". It happens commonly. Two recent high profile examples (admittedly not in this country) are Ronaldo at his Saudi club, and I think it was Lewandowski and a couple of others at Barcelona in the summer. Different reasons for those two examples, but the are examples of national federations refusing to process a registration because the club has breached local financial or other rules.

Kristian Pederson (Birmingham) is a more relevant example.  Signed for Brum but they weren’t allowed to register him!!  Brum knew they had to agree all signings with the EFL and they chose not to, didn’t they.

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Others will correct me if necessary but as I understand it there are limits to how much owners can put into a club in that they can only cover cash losses up to the upper loss limit (£13m). This has to be in the form of equity and not for instance loans. Steve's practice is to convert loans to shares.

So Steve cannot give Nigel, say, £20m to spend and tell him to go for it regardless of FFP. Money for signings has to be generated by the club.

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40 minutes ago, Davefevs said:

Kristian Pederson (Birmingham) is a more relevant example.  Signed for Brum but they weren’t allowed to register him!!  Brum knew they had to agree all signings with the EFL and they chose not to, didn’t they.

He eventually was allowed but I am sure that the EFL have tightened up that loophole since. Possibly the League didn't handle that aspect of it well...there's s few aspects of that slam dunk case that they didn't handle well.

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It's easy with hindsight but they should have pushed for a suspended deduction as with Reading linked to non adherence to the Business Plan. Birmingham at that point in time were under a full 100 pct embargo so the League might have used that when thrashing out the Business Plan..

Edited by Mr Popodopolous
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Referring to FFP he can put in as China says, the equity limit but he can put in as much cash flow as required but short of solvency that isn't really an FFP requirement.

1 hour ago, tommy_b said:

Has this happened previously for anyone yet? I mean actually putting clubs on an effective transfer embargo without notification? 
 

There was a new rule that came in which Dave and EA refer to back in February. This is a bit of a gamechanger and I'm unsure how much it has been used in past seasons. There is more detail on the EFL FFP, Championship P&S regs.

I assume that it is currently biting with us and others.

Screenshot_20230113-185643_Chrome.thumb.jpg.ca0fae5bd186ee9f7888ed9bfa1afe62.jpg

https://www.efl.com/-more/governance/efl-rules--regulations/efl-regulations/appendix-5-financial-fair-play-regulations/

2.9 to 2.10.3.

Edited by Mr Popodopolous
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I think this is the correct thread for it.

I'll just post one or two snippets and leave the stage to others.

For me it's an unknowable but what will the CFRP deem appropriate, compliant and proportionate? I'll leave to others.

https://www.sportresolutions.com/images/uploads/files/CFRP_Rules.pdf

I don't pretend to know the answer on that one.

Edited by Mr Popodopolous
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