What La Liga financial regulations are plaguing Barcelona? -Sports News, Firstpost
Spanish club football has strict rules on spending on transfers and squads, which has almost kept Barcelona from signing up players. But what are the rules and the implications?
Athletic Club and Real Madrid players during their Spanish La Liga soccer match at San Manes stadium in Bilbao, Spain on Sunday July 5, 2020 (AP Photo / Alvaro Barrientos)
In a largely moderate transfer window for Spanish football clubs, Rafa Mir became the third most expensive signing of the summer on Friday. The striker joined Sevilla from Wolves for € 16million. The two most expensive La Liga signings this summer have been: Rodrigo de Paul joining Atletico Madrid from Udinese for € 35million and Arnaut Danjuma to Villarreal from Bournemouth for € 23.5million.
There are a lot of moving parts in a transfer: an interested club comes to an agreement with the parent club, with the player himself, with representatives, third parties on image rights to name a few -a. And if that’s not complicated enough, there is also a potential struggle for a player’s services with other competing clubs.
Behind the scenes, there’s a lot going on even after all the deals are done. First post explains how a player is officially registered to compete in a top league such as La Liga and what economic controls are in place to ensure the financial security of clubs.
How are players registered in the Spanish First Division?
Since 2016, Spanish clubs have been using software called “LaLiga Manager” to carry out transactions for new or departing players. Over the past five years, more than 2,000 transfers have been managed using this digital tool.
LaLiga Manager provides club managers (and lawyers) making transfers with all the documents they need to complete or upload to the system. The tool also contains all FIFA, UEFA and La Liga regulations that must be observed, regardless of the nature of the transfer: free agent, with payment of a fee or by triggering a clause. release.
If the transaction is between two Spanish clubs, then the selling club must remove the player from its lists on “LaLiga Manager”.
Some of the details that must be entered include: the amount paid to the selling club, the terms of the players’ contract, the agents involved and the relevant taxes. The information is then ratified at LaLiga offices for accuracy and subject to Economic Control and Team Cost Limitation (SCL) rules. Economic control aims to keep spending on sports personnel within limits.
What is economic control?
Economic controls and the team’s cost containment rule prevented Barcelona from handing Lionel Messi a new contract as the club’s salary-to-turnover ratio stood at 105%. Amid a € 1.35 billion debt, Barcelona have reportedly been unable to register new signings from Memphis Depay, Sergio Aguero and Eric Garcia. That has changed with Gerard Pique suffering a pay cut and more and more senior players – Sergio Busquets, Jordi Alba and Sergi Roberto – are also expected to give up their pay.
Economic control is a regulatory framework that was introduced in 2013 with the aim of keeping clubs afloat and thus keeping competition (leagues) sustainable. This decision came following multiple financial irregularities that affected clubs such as Deportivo La Coruña, Racing Santander, Valencia, Real Zaragoza, Real Mallorca, Albacete, Real Betis.
What is the difference between economic control and UEFA’s financial fair play (FFP)?
The fundamental difference lies in the application of the rules. Where FFP later acts against stray clubs for breaking regulations, Spain’s economic control acts before things get out of hand (to some extent). Clubs know how much they can spend up front, making it easier to stay within limits and avoid creating unsustainable debt.
What does Squad Cost Limit (SCL) mean?
This is the amount each club can spend on their squad. The definition of a team extends to registered players, non-registered players and coaches (head coach, assistant coach, physical trainer and others). And when it comes to payments, it includes aspects such as salaries, variable payments, image rights payments, agent fees, amortization of transfer rights, social contributions, allowances. , license fees, etc.
Formula for calculating the SCL: Budgeted non-sporting expenses are subtracted from budgeted income, with debt repayments taken into account.
For the 2020/21 season, Real Madrid were eligible to spend € 468m, while Barcelona’s stood at € 382m and € 252m for future champions Atletico Madrid.
What happens if a club exceeds its authorized SCL?
COVID-19[female[feminine has resulted in a drastic reduction in the income of football clubs across Europe. With that in mind, expenses have remained largely the same, if not increased for security reasons. In situations where a team exceeds the SCL, clubs are allowed to spend no more than 25% of a cost that has been reduced beforehand.
Called the “1/4 rule”, two exceptions have been introduced in the 2020/21 transfer window: if a club above the limit realizes a transfer gain, then 25% of this gain will be added to “1/4”. calculation. In addition, if a saving is made through a player who represents more than 5% of the SCL, a “1/2” rule will be applied instead of a “1/4” rule. In other words, 50% of that savings can be spent.