Home sweet home: City's ground was renamed the Etihad
Stadium following their bumper sponsorship deal
Clubs such as Manchester City should be prohibited
by UEFA from being sponsored by companies closely associated with
their owners, a Council of Europe committee has
stated.
The estimated £400million partnership deal between City
and Etihad airline has been described as an 'improper transaction'
in a report by the Council's culture, science, education and media
committee.
It also highlights Real Madrid's sale of its training
ground to the city for more than 400million euros (£334m today) as
possibly giving the club an unfair
advantage.
The Council of Europe cannot impose any rules however - it
is separate from the European Union and acts as a watchdog
body.
Their report says UEFA will have to take care to ensure
their financial fair play rules, where clubs must only spend what
they earn, are not circumvented.
'Clubs will no doubt try to supplement their income if
possible. They could for example call on sponsors to invest more so
as to reduce or eliminate their deficits,' says the
report.
'Care will have to be taken to prevent any circumvention
of the financial fair play rules in this way.
'A case in point is Manchester City, which has entered
into a contract estimated at £400million with the airline Etihad.
Etihad belongs to the Abu Dhabi royal family, and the Abu Dhabi
United Group, which is led by Suleiman Al-Fahim, owns Manchester
City.
'In order to avoid improper transactions of this kind,
UEFA should prohibit clubs from sponsoring themselves or using
associated bodies to do so.
'There is also a need to monitor the "purchases" of
sponsors, who should not overpay for the rights they
acquire.'
Manchester City are by no means the only leading European
club with such a deal. Paris St Germain, owned by one of the
members of Qatar's ruling family, last month announced a major
sponsorship deal with the Qatar National Bank.
The committee warned that public authorities can
indirectly give financial help to clubs - and that is part of the
problem.
The report adds: 'This poses the question at which point
competition between clubs can significantly be distorted, and some
clubs enjoy an undue advantage, as a result of the financing of
sports infrastructure, its sale to sports companies or placing on
loan to teams, the granting of subsidies, loans, tax breaks or
other financial benefits, gifts, the purchase by public authorities
of advertising space or, indeed, facilities belonging to clubs, or
other measures to support sports companies.
'For example, in the early 2000s Real Madrid was able to
sell its training ground back to the city for more than 400million
euros.
'There is a need for strict application of the ban on
state aid for professional sports companies.'
The committee is against the introduction of a salary cap.
It says to do so would lead to a reduction in pay of less
well-known players 'especially young players or players from
African or Asian countries' and the temptation for clubs to enter
'into secret deals or to reach arrangements with sponsors to
transfer part of the costs to them'.
