Friday 14 March 2014

The flaw in Roland's model

There are lots of rumours floating around about the nature of Roland Duchâtelet's takeover, whether he is part of a larger consortium and whether he will stay for long. I have no independent or verifiable evidence relating to those rumours, although up to now he has been a purchaser rather than a seller of clubs. Given that he buys relatively cheap, money is not an issue, as is evidenced by the fact that he has not accepted what he saw as an inferior offer for the mother ship.

What I can say something about is the European dimension of his plan. I don't suppose for a moment that he has read our 2011 book The transformation of European football: towards the Europeanisation of the national game but it is certainly consistent with his model. Unfortunately, Manchester University Press have not issued it in paperback. The responsible editor is a mad keen Rochdale fan (yes, really) and took umbrage when he came to The Valley for our cup tie with them some years ago and heard my name being read out as match ball sponsor. What is worse, we could end up playing them in the league again next season! Crawley, Stevenage, Rochdale. Oh the glamour!

In our book we argued that the Commission had an agenda in relation to football as they saw it as a Europeanising force that could reach EU citizens. However, in our view UEFA was even more important in this respect which is why we asked a senior UEFA official to contribute a chapter (in a personal capacity, and he has now left). He argued that a European public space might be emerging 'which describes the direct transactional interaction between citizens from different member states who share the same concerns; it would be an essential step towards the creation of a European demos.'

After discussing the Champions League as one of the most effective European symbols, he discussed the need for a 'Europeanisation' of football so as to promote 'greater sensitivity to a common European identity'. He acknowledged the presence of strong local identities in football, but also thought that it placed people in an enlarging European framework. The challenge was how to link clubs across Europe. Well, Roland has an answer.

However, his answer does depend on the success of financial fair play of which he is a great supporter. It is been my view for some time that UEFA's scheme is open to challenge in the courts under European competition law. I consulted two sports lawyers yesterday, and although I am yet to read the materials they sent me in detail, they agreed with me.

How this affects the Football League's domestic financial fair play scheme is a more complex problem. British competition law has its own particular features, some of them borrowed from the US. However, the Commission was given strong powers in the original Treaty of Rome over competition law (rather broadly defined) and this should prevail over member state law in the event of a conflict.

QPR (and other clubs) are understood to have already instructed solicitors (Brabants) and a warning letter has been sent to the Football League. If the matter goes to court, as it surely will if the Football League does not modify its plans, and the English court found in the League's favour, the matter could then be referred to the European courts. At the very least, this would lead to substantial delays in implementation.

2 comments:

Anonymous said...

Thanks Wyn. Very interesting post.

Even if FFP is successfully upheld by the courts, there is still an uneven playing field as demonstrated by Manchester City and PSG. The extremely wealthy clubs can hire the best lawyers/advisors etc. to circumvent the rules and create enough arms length in their deals to make dubious sponsorship agreements with the owner's affiliated businesses comply with the regulations.

Any rules creating a slightly more level playing field seem healthy for the game overall. It seems plausible to agree to industry wide regulations concerning the levels of expenditure/debt relative to turnover, particularly when you consider industries such as banking are regulated regarding capital ratios and other financial health indicators.

The question for both football as a whole and the EU will be where you draw the line between sensible regulatory benchmarks and the creation of a system that leads to a restriction of trade and competition. Another job to keep the lawyers busy.

Always enjoy your blog as it often offers a slightly different perspective to some of the others. I don't always agree but its usually very balanced. I actually studied politics at Warwick a decade back but was never on your courses which was a shame as I'd heard of you pre-Uni from your VOTV days. I did manage to bore Shaun Breslin with my Charlton chat for a few years though (sure he's enjoying this season more than us).

James

Wyn Grant said...

Derby are a bit up and down, but in a better place than we are. I think the problem for the EU is that different parts of the institutions have different perspectives. The Competition Directorate-General in particular is known for sticking to the letter of the law. I'm not against a regulatory framework, but the Uefa one allows the existing big clubs to pull up the ladder behind them. The one thing I am sure of is that it is a good time to be a sports lawyer!