Showing posts with label financial fair play. Show all posts
Showing posts with label financial fair play. Show all posts

Wednesday, 26 November 2014

Bent joins Brighton on loan

One time Addicks striker and so-called 'transfer misfit' and 'bit part player' Darren Bent is to join Brighton and Hove Albion on loan, initially for 28 days: Darren Bent

Whether or not one thinks Bent is a shadow of his former self or can still weave some magic, it is doubtful whether we could have afforded his wages. This raises a bigger question.

Roland's strategy has been built around the arrival and enforcement of financial fair play (FFP), enabling a prudent club to compete on a reasonably level playing field. I always had my doubts about it because it seemed to me that FFP was susceptible to a legal challenge on competition law grounds, as a recent case in Spain has emphasised: Court decision .

In any case, FFP has now been substantially diluted. The club that changed their minds at the last minute to provide the required 75 per cent majority? Brighton and Hove Albion.

While I think that Roland has edged away from a formal break even strategy, it is difficult to see how the club can be run at a small loss and still compete. There are dangers in going down a 'player farm' route and in any case it has been our declared intention to hold on to our Academy talent. We don't have the sophistication or resources of Southampton as far as such a strategy is concerned.

Last season we made £1.7m on player sales and got a £900k bonus out of our cup 'run', but still made a loss of £5.7m. One implication is that we badly need a cup run, or at least a match against a top club, which would be good news for fans as well as financially.

Monday, 22 September 2014

Trustworthy

I think the CAS Trust is doing a good job given the constraints they face, but it is evident from conversations that some supporters are still suspicious of them. It is difficult to see what alternative representative structure there is or might be. I suppose some fans might say they don't want to be represented by anyone, but then it is difficult to see how the club can have any kind of dialogue with fans.

Some of the difficulties that can arise in that relationship are evident in Richard Murray's remarks at the Trust annual general meeting which can be read here: Richard Murray

The latest Trust News was also very good value, particularly considering it was given out free! I particularly enjoyed the article on how the Second World War affected the club.

The interview with Katrien Meire was also very interesting, not surprising that she came across as charming but steely. It was interesting to learn that she had approached Roland about a job, given her love of football, and that he had already certain her a number of e-mails on the day of the interview, which shows that he is very 'hands on'.

Interesting also that she is a competition law specialist, an area of law that has particular relevance for football and has brought about many changes in the game, e.g., the Bosman decision. However, given that, I am a little surprised that she and Roland place so much faith in financial fair play delivering a more level playing field for clubs like Charlton.

I am not a lawyer, let alone a sports lawyer, but I have talked to a number of them and read some of their papers and they are doubtful whether the Uefa scheme as drafted is compatible with European Union law, and by extension whether the Football League scheme has also has a sound legal basis. QPR may, of course, mount a court challenge, but one could also be initiated by a player, as in the case of Bosman.

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.

Tuesday, 4 March 2014

Late Kick Off

Before I got the watch the segment about Charlton on I-Player I was interested in these comments from an Addick which reflect my thinking about Roland:

'Well I’ve just read the BBC website story and watched the video and I don’t see anything to be worried about. Given the relative level of Standard and us we’re more likely to get players that aren’t quite good enough for their first team coming to us.'

'And since when have we not had to sell our better players to balance the books? We’ve done it throughout my time as a supporter going back to before the return to The Valley.' [It was certainly happening in the 1950s under the Glikstens].'

'This really does smack of the BBC trying to find a story when one doesn’t exist. The video appears to me to have been edited in such a way as to reflect negatively on both Duchatelet and de Sart. Duchatelet has said on multiple occasions that he’s not going to throw money at any of his clubs and that they need to stand on their own feet. Makes sense to me. It might also help us attract good young talent in this country if they know that, should they outgrow Charlton, they’ve got a potential shot of going to a Champions League team. Of course, time will tell.'

I have now watched the clip on I-Player which started with dramatic and gloomy music playing to set the tone. I suppose if nothing else it got a BBC reporter a trip on Eurostar to Liege. The independent coffee shop analogy amused me as the main consequence of my local coffee shop being taken over would be that I would no longer have to struggle with my order in Portuguese. (The broader point here is that we do live in a Europeanised environment). The most interesting revelation in the programme which no one else has mentioned is that there is going to be a meeting of all Roland's clubs in the next week to discuss how they are going to work together. That could be an important meeting.

The Liege fans were clearly very fed up with Roland when he arrived and staged demonstrations of a type consistent with the history of the city. However, they have all been mollified now that SL are top of the league, although they have lost their last two matches and could fall foul of Belgium's curious play off system (see Chicago Addick for more details).

One Liege fan said that he thought that Roland was out to make money, but he is too shrewd a businessman to think that you can make money out of clubs. He certainly doesn't want to lose money, and may sell Charlton players if that is necessary to balance the books, but his real inspiration is his 'grand projet'. Like all experiments, that could succeed or fail.

Jean-Francois de Sart struck me as a bit of a plonker in need of some media training, but his English is reasonably good and almost certainly better than Chris Powell's French.

I don't think we needed someone from Millwall to tell us that fans should be worried, particularly when he claimed that his team was playing well, just not getting the points.

If I have a reservation about Roland's strategy, it is its reliance on financial fair play working. I am certain there are going to be legal challenges at international and domestic level and some of them might succeed given a possible incompatibility with competition law. Even if the legal challenges do not succeed, it is going to take some time for the full benefits to be felt.