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Ontheminute.com: Malaga ban a test of UEFA’s new rules

Malaga ban a test of UEFA’s new rules

Published: 13.01.13 / Written by: David Gold

UEFA’s recent decision to ban Malaga from European competition for a season did not meet with much of a reaction.

It is fair to say the football world was underwhelmed. The Andalucian club certainly are not taking the punishment lightly however. They are furious at being targeted and penalised by UEFA for the perilous state of their finances. In particular, they are aggrieved at being kicked out of Europe because they see qualification for the Champions League as the financial lifeline they need to keep themselves afloat.

Yet that is the point of UEFA’s new financial fair play rules. They are an attempt to force clubs to cut their cloth according to their incomings, and are meant to project some kind of financial sanity onto teams. The idea that a club’s financial destiny can ride on qualification for Europe’s elite tournament is not a million miles away from taking the remaining silver and throwing it all on red on a roulette wheel.

Therefore UEFA have taken the stand they have in what can be called the first major battle of the new financial fair play rules. And the battle has only just begun, if Malaga’s threats to take UEFA to the Court of Arbitration for Sport are to be believed. The legal test of UEFA’s ruling will be an important one with the new financial fair play rules set to come into force properly from next season. The two seasons with losses no more than £43 million ends this campaign. From next season, UEFA could in theory ban teams whose accounts do not add up. Manchester City may be looking on with interest, given they lost more than double the permitted amount for two seasons last year alone. UEFA do allow for positive trends to mitigate the punishment a club can receive, but it will still be intriguing to see their reaction to City’s finances, which presumably will not improve to the extent that they make a £50 million profit in the 2012-13 season. Unless that unlikely circumstance happens, City are almost certain to fail the new financial tests brought in by UEFA.

So Malaga are in many ways fighting the battle for billionaires around the continent. Not just those in Manchester, but Roman Abramovich, the Chelsea owner, will have his eyes intrigued by what happens in Switzerland if Malaga carry through on their legal threat. Paris St Germain too will be interested. Their owners are linked to Malaga’s, both through Qatar’s royal family, and they may be giving hints and tips to the Spanish side as they fight their battle. The Parisians have, it should be noted, hired the son of Michel Platini as a lawyer.

Malaga’s fight should therefore be one of the most intriguing stories of the months to come in the financial world of football. This is a club who have spent huge sums to get into the position they are, but who have then failed to pay up to some of their creditors in full, thus finding themselves now in dire financial straits. Their ability to haul themselves out of the mess they find themselves in will be tested to its very limit, and the fight they are about to take on could have ramifications across the continent in the years to come.

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