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Football luxury tax could be blocked by EU


Uefa is becoming increasingly concerned about competitive imbalance in European football with the emergence of super clubs, state surrogates in the case of Paris Saint-Germain.   They think that a situation in which only a small number of clubs could win the Champions League could reduce the appeal of the game and hence broadcast income.

Financial Fair Play was never intended to level the playing field.  It was about clubs living with their means and making sure that football was sustainable without disruptive bankruptcies,  It seems to have worked in the sense that in five years the aggregate losses of European clubs dropped from about £1.66bn to about £262bn, a 84 per cent drop.  However, it has also had the unintended effect of reinforcing the elite status of the top clubs.

What Uefa is thinking of is a 'luxury tax'.  This means that if a team spends beyond a certain amount on wages and transfers, it pays money into a central pot which is then redistributed among other clubs.  It's a common practice in US sport, but illegal under EU competition law.

Clubs who are owned by profit-seeking investors such as Manchester United may favour it to bring down their costs.  Public trusts such as Barcelona and Real Madrid or free spenders like Paris Saint-Germain are likely to oppose it.

The next step would be to overcome the European Commission's objections.  Political forces often produce a negoiated deal on such issues as happened with the introduction of the transfer window.

Meanwhile, perhaps Uefa should put in a call to Charlton Athletic chief executive Katrien Meire.  She is the only known example of a competition law specialist who is also chief executive of a football club.