- Uefa looking to set cash limit on amount spent on wages, transfers and agents’ fees
- Move aims to address English clubs’ financial dominance
If approved, the cap would run alongside Uefa’s new Financial Sustainability Regulations (FSR), under which teams in European competition are only permitted to spend 90 per cent of revenues on wages and transfers in 2023. This will drop to 80 per cent next year and 70 per cent in 2025.
Uefa is reportedly favouring a fixed cap every season, setting a cash limit on the amount that clubs can spend on wages, transfers and agents’ fees. The Times adds that the transfer cost is assessed by Uefa on amortisation, which is the transfer fee spread out over the length of the contract up to a maximum of five years.
It is understood that no absolute level for a cap has been discussed by Uefa but, if approved, it would mean that a club could not spend more than the cash limit, even if it was within the 70 per cent of total revenue.
Uefa is said to be working on the proposal to ensure it would get European Union (EU) approval, though that may result in having to secure the agreement of European soccer’s stakeholders. The European Club Association (ECA), which represents leading clubs, is said to be in broad agreement, though the European Leagues and the FifPro players’ union reportedly have concerns.
The plan has been submitted to a working group, which includes representatives from Uefa, the ECA, the European Leagues and FifPro players’ union, set up to examine how to increase the sustainability and competitiveness of European soccer, including exploring the potential cap.
According to The Times, the working group is also looking at the impact of different corporation tax levels in different countries, given that could have an effect on how much clubs have to spend. The newspaper notes that, for example, the tax large companies have to pay is 13 per cent in Switzerland, 25 per cent in the UK and 27.5 per cent in France.
Speaking to US media outlet Men In Blazers back in April, Uefa president Aleksander Ceferin said he wanted to introduce a salary cap in European soccer “as soon as possible” in order to protect competitive balance, adding that talks with clubs were underway. The 55-year-old deems a cap as “the solution” to ensure wages are kept under control.
The move is partly in response to concerns from continental teams that English sides, with their mega-rich owners and Premier League broadcast rights money, could become even more financially dominant under FSR. Uefa knows it has to try and level the playing field as the financial gap between the Premier League and other European leagues widens.
Should the plan be approved, Uefa’s club competitions, including the Champions League, would join other elite leagues with spending caps. The National Football League (NFL) has a hard cap meaning teams can spend a maximum of US$224.8 million on player contracts, while the National Basketball Association (NBA) has a soft salary cap of US$123.7 million per franchise.