The impact of the UEFA implementation of the Fair Play Financial Regulations could have a ripple effect that hurts soccer teams around the globe.
The Zimbalist article entitled, “Sport as Business” (2003) also brings up a good point about the socialization of sports leagues. Before the UEFA regulations take effect, the league operates in a relatively capitalist manner. Certainly many of the monetary imbalances that exist are not readily apparent when officials audit the books of the different teams, but as a business model, the new UEFA regulations may very well hurt the revenues of the entire league, not just certain teams specifically (Zimbalist, 2003). This would occur as club owners looking to turn a profit would be severely limited by financial restrictions put in place that force owners to stay debt-free. Owners will have less opportunity to attract talented players, especially owners of teams whose revenue is rather small. And as the gap between the richest and poorest teams widen, this problem will become exacerbated with time. But at the same time, the owners themselves will be pleased that they will no longer be legitimately able to offer their most talented and most expensive players the same exorbitant salaries afforded to them before. The owners will undoubtedly be happy that less of their revenue will go to salaries and more of the profit will be returned to the club as a business.
This very same result occurred in the MLB leagues in the United States after salary caps were introduced to try to create a more balanced league relative to competitive advantage.
Certainly the current UEFA teams are by no means operating on equal footing. Many of the most popular and most profitable teams have a distinct advantage over smaller teams, yet the larger teams deficits continue to soar as more and more money is demanded by top players. The new UEFA regulations will help to reduce the direct debt obligations of the leagues teams, but in fact, the regulations will hurt the league in many ways, and these effects will likely not be limited to European soccer alone.
Conte, Niccolo. 2010. “UEFAs Financial Fair-play and why we should care.” Soccer Lens
Homepage. Found Online August 15, 2010 at < http://soccerlens.com/uefas-financial-fair-play-and-why-we-should-care/52314/>.
Ducrey, Pierre; Ferriera, Carlos Edward; Huerta, Gabriel; and Kevin Tallec Marston. 2003.
“UEFA and Football Governance: A New Model.” Centre International DEtude Du Sport.
Rottenberg, Simon. 1956. “The Baseball Players Labor Market.” Journal of Political Economy,
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