John W Henry: Newcastle made a hell of a deal. We felt the same way

[Tinto]

[quote author=Asbo link=topic=44054.msg1278725#msg1278725 date=1296914419]
Someone made the point (somewhere today maybe on here?) that it will be IMPOSSIBLE to regulate.

One example given is Abramovich or Citys owners sponsoring Chelsea with one of his own companies for an unrealistic amount, but how can FIFA stop them?

The name on the shirt would be legit, the sponsorship deal unbeleivable
[/quote]

According to the Swiss Ramble UEFA won't allow this:-

http://swissramble.blogspot.com/2010/10/how-manchester-city-could-break-even.html

I'll quote the relevant bit from that blog as I would imagine not everybody would want to read through it all:-

This is the area where those fans who have not bothered to plough through UEFA’s regulations (and who can blame them?) see an easy way to reach the target. Why doesn’t the Sheikh sign a £200 million sponsorship deal? Or pay £50 million a season for a super-VIP executive box?

Unfortunately, that simply will not fly, as UEFA have introduced the concept of “fair value†so beloved of tax authorities when reviewing inter-company transactions. In short, if an owner over-pays for services, this will be adjusted down to market value, i.e. what the club would have received if the transactions were conducted on an “arm’s length†basis. Obviously, there is still some scope for manipulation, but the most blatant excesses should be prevented.

 

[Asbo]

[quote author=Tinto link=topic=44054.msg1278796#msg1278796 date=1296921077]
[quote author=Asbo link=topic=44054.msg1278725#msg1278725 date=1296914419]
Someone made the point (somewhere today maybe on here?) that it will be IMPOSSIBLE to regulate.

One example given is Abramovich or Citys owners sponsoring Chelsea with one of his own companies for an unrealistic amount, but how can FIFA stop them?

The name on the shirt would be legit, the sponsorship deal unbeleivable
[/quote]

According to the Swiss Ramble UEFA won't allow this:-

http://swissramble.blogspot.com/2010/10/how-manchester-city-could-break-even.html

I'll quote the relevant bit from that blog as I would imagine not everybody would want to read through it all:-

This is the area where those fans who have not bothered to plough through UEFA’s regulations (and who can blame them?) see an easy way to reach the target. Why doesn’t the Sheikh sign a £200 million sponsorship deal? Or pay £50 million a season for a super-VIP executive box?

Unfortunately, that simply will not fly, as UEFA have introduced the concept of “fair value†so beloved of tax authorities when reviewing inter-company transactions. In short, if an owner over-pays for services, this will be adjusted down to market value, i.e. what the club would have received if the transactions were conducted on an “arm’s length†basis. Obviously, there is still some scope for manipulation, but the most blatant excesses should be prevented.

[/quote]

Well the Shiek (or whoever) could just point to Man U's massive sponsorship deal and say its exactly the same as thiers, so it IS feasible?

 

[Sunny]

[quote author=Asbo link=topic=44054.msg1278808#msg1278808 date=1296922168]
Well the Shiek (or whoever) could just point to Man U's massive sponsorship deal and say its exactly the same as thiers, so it IS feasible?
[/quote]

I don't even think £20m a year is going to cover their overheads mate. That's the Man Utd deal. If Chelsea wanted to cover the losses they would need a sponsorship deal worth £80-100m a year. That's unheard of.

 

[Asbo]

Yeah I know, but its a huge chunk from just one thing.

Add to that corporate boxes, pitch side advertising, it all adds up, and its all a way for them to keep injecting cash lawfully into the club.

 

[Sunny]

[quote author=Asbo link=topic=44054.msg1278816#msg1278816 date=1296922511]
Yeah I know, but its a huge chunk from just one thing.

Add to that corporate boxes, pitch side advertising, it all adds up, and its all a way for them to keep injecting cash lawfully into the club.

[/quote]

Yeh I understand what your saying but surely it has to fall in line with 'fair value'. Mind you, who am I kidding. It's UEFA they're as corrupt and inept as they come

 

[FoxForceFive]

[quote author=Asbo link=topic=44054.msg1278816#msg1278816 date=1296922511]
Yeah I know, but its a huge chunk from just one thing.

Add to that corporate boxes, pitch side advertising, it all adds up, and its all a way for them to keep injecting cash lawfully into the club.

[/quote]

But they can't, not at higher than market value prices anyway. That's why the legislation is written like that.

What I'm not sure on is more underhand ways, for instance one of Romans companies making Torres a director & paying him 200k a week yet Chelsea paying him 20k a week.

 

[Judge Jules]

Depends how badly UEFA want to enforce their regs. If they're serious about doing so, I'm sure a hotshot lawyer could find a way of attacking such bogus dealings.

 

[King Binny]

[quote author=Asbo link=topic=44054.msg1278725#msg1278725 date=1296914419]
Someone made the point (somewhere today maybe on here?) that it will be IMPOSSIBLE to regulate.

One example given is Abramovich or Citys owners sponsoring Chelsea with one of his own companies for an unrealistic amount, but how can FIFA stop them?

The name on the shirt would be legit, the sponsorship deal unbeleivable
[/quote]

Yeah, Wenger was the one who spoke about it. He's got an

[quote author=Binny link=topic=43861.msg1278543#msg1278543 date=1296876802]
Regarding the financial fairplay rule:

Wenger, though, is mindful of clubs trying to exploit a potential loophole in their sponsorship deals.

“If it is a private company they can decide how much money they put in — it can be a disguise sponsorship,†he said. “Will that sponsorship on the shirt be at the level of the price of the market?

"For example, if [Roman] Abramovich has one of his companies and the usual price is £10million on the shirt, if he puts £50million in, can you go against that?â€

Wenger has voiced doubts over Uefa's ability to implement its Financial Fair Play regulations. Uefa plan to prevent teams from spending beyond their means in future, but the Arsenal manager expressed his fear that the details had not been fleshed out.

"[Uefa] are just now building the committee which is in charge to elaborate the whole system," Wenger said. "Nothing is being decided on the Uefa side. They are putting the rules into place for 2013 and don't know how to do it."

[/quote]