Messi signing rekindles debate on fair play
Paris St Germain’s signing of Lionel Messi has reignited a debate over the effectiveness of UEFA’S Financial Fair Play (FFP) rules, which were designed to curb excessive spending but have been relaxed in the last year due to the coronavirus pandemic.
The rules were introduced in 2009 to prevent clubs spending beyond their means and distorting the market, requiring teams to break even and keep wages and transfer fees in line with income.
PSG and Manchester City were among clubs to fall foul of the rules, although both teams avoided excessive punishment after winning appeals through the Court of Arbitration for Sport.
A softening of rules to help clubs cope with the financial shock of the pandemic, however, means neither PSG nor City — who last week broke the Premier League transfer record to buy Jack Grealish for 100 million pounds (US$138 million) — have had to worry about new investigations into their spending.
“We know the rules of Financial Fair Play and we will always follow the regulations,” said PSG chair Nasser Al-khelaifi at Messi’s presentation on Wednesday.
“Before we do anything, we check with our commercial, financial and legal people. We have the capacity to sign him. If we sign Leo, it’s because we can, otherwise we would not have done it.”
PSG’S revenue for 201920 was 541 million euros ($795 million), according to a report from KPMG, while their wage bill stood at 405 million euros. Their spending on salaries has soared in the last year, however, since signing Georginio Wijnaldum, Sergio Ramos and Gianluigi Donnarumma on free transfers, allowing them to offer bumper wages in lieu of transfer fees.
PSG have also splashed out 60 million euros on fullback Achraf Hakimi from Inter Milan while the signing of Messi — who will pocket a reported 25-million-euro signing-on fee and annual salary of 63 million euros — has inflated their wage bill even further.
The club’s revenue, meanwhile, has fallen due to the pandemic and the French league’s television rights deal collapsing, but for now they have no obligation to break even.
Another key rule change from UEFA was allowing owners to spend their own money to alleviate losses, which played into the hands of Qatari-backed PSG and Abu Dhabi-funded City but provided little relief to fanowned Barca. The Catalans were also at the mercy of Laliga’s financial fair play rules, which sets each club a maximum budget each season according to their expected income.
Barca’s budget for the 2019-20 campaign was 671 million euros, dropping to 347 million euros last season due to the pandemic. It is reported to fall to between 160 million and 200 million euros for the next campaign, making it impossible to give Messi a new deal.