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SBD Global/July 23, 2013/FinancePrint All
Execs of Premier League clubs Chelsea and Liverpool said that they "are not confident" that UEFA "can administer new cost-control regulations amid lavish spending by clubs backed by wealthy owners," according to Tariq Panja of BLOOMBERG. Starting next season, clubs that breach UEFA Financial Fair Play rules will face sanctions that the governing body said "will include fines, transfer embargoes and even suspension from the elite Champions League." Liverpool Managing Dir Ian Ayre said, "We have to see the application by UEFA, we have to wait and see how fair they really play it. I have to say my level of confidence in it isn’t very high." Even "amid the rules aimed at taming" Europe-wide football losses of more than $2B, Man City and Ligue 1 Paris St. Germain, both owned by Gulf royalty, and Monaco, backed by a Russian billionaire, "have continued to spend while losing money." Chelsea CEO Ron Gourlay said the team, which announced its first profit in the Abramovich era last year, is "focused on complying with the rules even though it was 'among the clubs targeted'" by UEFA when the changes were announced in '09. Gourlay: "It’s UEFA's competition so we want to make sure that we comply. All we’ve asked for is that UEFA police and manage the process with a clear, even playing field." Gourlay said that he was "concerned about teams boosting their balance sheets through 'arm’s length' contracts with companies connected to their owners." UEFA said in a statement that its Club Financial Control Body, responsible for administering the rules, will "benchmark" all deals and "only the fair value will be taken into account for the purpose of the break-even reporting." UEFA's statement said, "If clubs do not abide by the rules, the CFCB will use the list of sanctions at its disposal, irrespective of which clubs are not in line with the regulations" (BLOOMBERG, 7/22).
Spanish second division side Deportivo La Coruña's official daily publication is leaving kiosks after more than eight years to move online, according to the EFE. The paper will be available to readers for free on the club's website immediately. The format change coincides with a delicate period for the club, which has been in bankruptcy proceedings since January. On June 11, a judge ordered that the club turn its political rights to its subsidiaries to bankruptcy administrators. These rights included the publishing of Deportivo's publication, the Galegas Sporting Edition. The debt the publishing of the publication presented in June had risen to €1.5M ($2M), with more than €400,000 ($527,680) owed to employees and more than €20,000 ($26,384) to contributors (EFE, 7/22). In Barcelona, Ríos & Segura reported the story "is simple:" if Deportivo President César Lendoiro does not pay the club's €10.9M ($14.4M) debt, Deportivo will go directly to the Spanish third division -- second division B. It could be worse, "of course, if bankruptcy administrators did not see the viability of the club, which would mean the club would immediately disappear." Deportivo bankruptcy administrator Julio Fernández Maestre said, "If I have to sign the request for liquidation I will do so with pain in my heart, but without fear." The "numbers do not deceive." Moving down from La Liga to the Spanish second division means earning €3M ($4M) instead of €18M ($24M) (MUNDO DEPORTIVO, 7/22).
Spanish province Cantabria President Ignacio Diego has joined former Spanish third division side Racing Santander players in asking the club's Administrative Council to step down because "it will be the only solution for saving the club," according to the EFE. Diego, who was joined at a press conference by former Racing player Quique Setién, assured that the club's future also depends on "legal and administrative circumstances," but insisted "convincingly and clearly that the current Administrative Council should resign first." Setién explained that former players who "already asked for the Council's resignation 15 days ago" do not want to control the club, they "just want to get it running and let the football fall in the hands of footballers, not in those of people who have never kicked a ball in their life." Setién rejected the Council's claim that stepping down would be impossible. Diego recognized that "the future of Racing Santander does not only depend on wills because the club is also facing legal processes," but he said that "the first step for a solution is the departure of the Council and everyone in the club's 'leadership circles'" (EFE, 7/22).