Checks and balances needed in football

  • Business
  • Thursday, 14 Jul 2011

FOOTBALL fans from Malaysia and other parts of South-East Asia will be spoilt for choice when they are treated to three games by a trio of England's most popular clubs. Arsenal, which played last night, Liverpool, on Saturday, and Chelsea, in the middle of next week, play the Malaysian national team in a series of exhibition games in preparation for the upcoming season of the Barclay's Premier League.

Those games will certainly be important for both the fans and the teams. Watching their favourite teams and players live is an opportunity most people in this part of the world will not have.

For the clubs, pre-season training in this part of the world is also driven by commercial reasons.

In Asia, there are millions of English football fans, many of whom are fans of Manchester United, Liverpool and Arsenal. The reason for such strong support is that those teams are steeped in history and have built their fan bases over decades.

But the game has somewhat changed with the entry of sugar daddies who have poured in hundreds of millions of British pounds into the nouveau riche teams. The most famous sugar daddy has been Roman Abramovich at Chelsea and now, Manchester City following the entry of Abu Dhabi royalty as its owner. Qatar Sports Investment, controlled by the country's crown prince, has bought a controlling stake in Paris Saint-Germain from France and there are examples elsewhere in Europe of rich sheikhs buying clubs.

Their entry into the sport has shaken the equilibrium of what constitutes the traditional big club. No longer is it just about fan support and commercial appeal but includes what financial backing by rich investors from Russia and the Middle East will bring to the teams they control.

The latest controversy over such financial muscle has been Abu Dhabi's purchase of shirt sponsorship and the naming rights for the City of Manchester Stadium, the homeground of Manchester City, for a reported 400mil.

In football, the richest jersey and stadium-naming right sponsorship was Arsenal's 15-year, 100mil deal with Emirates. But Manchester City's stadium and shirt sponsorship deal obliterates that of by Arsenal and its shirt deal dwarfs than even of Barcelona's, setting the benchmark in terms of such sponsorship even though the history and the fan size of the club is no where near that of its more illustrious rivals.

Calls have now been made to Union of European Football Associations (UEFA) to examine the Etihad deal with Manchester.

The call for greater scrutiny comes as money and success are seen as going hand-in-hand. Clubs with deep pockets can buy the best players and compete for titles. The limit on senior player registration by English clubs have stopped the richest clubs from hoarding top talent but inexhaustible wealth will allow such clubs with sugar daddies to offer wages few others can match.

Calls as to the fairness of the Etihad deal has reached football's top governing body in Europe, in particular relating to UEFA's financial fair-play rules which states that relevant income and expenses from related parties must be adjusted to reflect the fair value of any such transactions.

Compliance of such rules, which seeks to ensure clubs are financially sound, is needed before clubs are allowed to participate in European competition and such lucrative sponsorship deals are viewed suspiciously, given the massive losses Manchester City have registered in building up the team since its Abu Dhabi owners took over. The quantum of City's current losses, if it is replicated next season, could have disqualified the team from European competition once the financial fair-play rules kick into effect for the 2014/15 season.

Financial fair play is, however, not new in the arena of sport. Professional sports in America generally have what is known as salary cap, hard or soft depending on the sport, which acts as a leveller for small teams to compete in a franchise structure in North America.

It doesn't stop the big clubs and the more established franchises from spending over the salary cap but there are financial penalties if they do so. Even though the rich teams still dominate championships in such an environment, such salary caps have helped small clubs compete and occasionally win championships they would otherwise have a hard time winning.

Such salary caps will not work in European football as its structure is based on promotion and regulation but allowing swathes of money to be spent freely without checks and balances will eventually ruin the fun of the sport.

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