How many times have we heard about FFP? But more importantly, how often have we tried to discuss it without really understanding what it entailed? Well, now we might still be left with some questions, but we’ll need to shift our reference point. With the official announcement on Thursday, April 7, UEFA decided to overhaul the system that monitors European clubs’ finances, reforming it in a significant and substantive way and even changing its name. It will now be referred to as the “UEFA Club Licensing and Financial Sustainability Regulations.”
As explained by UEFA itself, this reform is focused primarily on the financial sustainability of clubs, without (for now) affecting competitive balance among them.
The new regulations will come into effect on the 1st of June and will be gradually implemented over a three-year period.
Curious about what will actually change? Let’s delve into the details of this reform.
To stabilise a system that was dangerously wavering in the post-pandemic context, UEFA has introduced three fundamental principles in its new financial plan: 1. solvency, 2. stability and 3. cost control.
1 – Solvency refers, as everyone now knows, to the timely payment of debts. The pandemic resulted in an estimated €7 billion loss for the European football sector, and many clubs were forced to increase their debts further. Now, to ensure creditors are repaid (and to facilitate sustainable and less risky investments than in the recent past), UEFA will conduct quarterly checks on the financial position of clubs every March, June, September, and December, allowing a maximum of 90 days to settle any new debt.
2 – Stability pertains to the classic concept of “balance of accounts.” Under FFP, clubs were allowed a deficit of up to €30 million over three years. Now, this limit has been doubled to €60 million. However, unlike previously, these deficits now include expenses that were once considered “virtuous,” such as investments in stadiums, youth development, women’s teams, and donations, which were often used to balance the accounts. New rules also apply to net worth: if it appears negative on a club’s balance sheet, it must improve by at least 10% in the following year. Additionally, this calculation will now be based on the calendar year rather than the season.
3 – Cost Control involves analysing each club’s expenses (player salaries, coaches, staff, agent fees, transfer spending…) in relation to revenue. Over the calendar year, clubs may spend up to a maximum of 70% of their revenue. The implementation will be gradual, with the percentage set at 90% for 2023/2024, 80% for 2024/2025, and 70% for 2025/2026. Cost control is often confused with the concept of a Salary Cap, a typically American system that limits player and coach salaries and mandates a maximum spending limit, which is not part of UEFA’s reform.
Penalties for failing to meet these standards can range from progressive fines to sporting sanctions (banning players from playing, exclusion from tournaments, or relegation to a lower competition).
But for Italian clubs? What can we expect?
Given the current debt situation and considering that Serie A was one of the leagues most affected by the pandemic in terms of revenue decline, maintaining expenses within 70% of revenue will be very challenging for our top clubs, especially since revenue in Italy is generally significantly lower than in other countries, like the Premier League, or top-tier clubs like Bayern Munich or PSG.
These challenges should prompt our clubs to control wage budgets, develop home-grown talent, and invest in facilities that ensure steady, clean, and lasting revenue streams—all areas where Serie A has struggled to gain traction.
Top European clubs, on the other hand, may find these regulations less restrictive: with high revenues, often boosted by substantial sponsorships, teams like Manchester City or PSG can continue to spend heavily on player acquisitions while managing high operating costs.
By Gianluca Zaghis
BOCCONI STUDENTS FOR SPORT MANAGEMENT 
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