Organisation also set to overhaul FFP rules to curb excessive spending.
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- Plans include access to funds at lower borrowing rates and restructuring debt over longer periods
- Salary cap and luxury tax on transfers purportedly being considered
- Uefa had previously said it expects clubs to miss out on €9bn in revenue due to Covid-19
Uefa, European soccer’s governing body, is close to putting together a rescue package worth as much as €6 billion (US$7.1 billion) to help clubs in their recovery from Covid-19, according to Bloomberg.
The organisation’s plan reportedly consists of a funding facility of €2 billion (US$2.4 billion) to €6 billion, an emergency pot of money to guard against future crises and new rules on financial fair play (FFP).
The three-pronged strategy by Uefa, purportedly set to be outlined in the coming weeks, is designed to help clubs after more than a year of decimated matchday income and falling broadcast revenue.
Under the proposals, according to Bloomberg, clubs will have access to funds at lower borrowing rates and be able to restructure existing debt over longer periods of five to seven years. The report says Uefa has also been in talks with London-based investment firm Centricus Asset Management over financing the plans.
Since the arrival of the pandemic, various reports and studies have highlighted the heavy financial impact on clubs. In June, Uefa itself said teams across all tiers of European soccer are forecast to miss out on €9 billion (US$10.6 billion) in revenue for the 2019/2020 and 2020/2021 financial years due to Covid-19.
In the same month, finance company Deloitte’s 30th Annual Review of Football Finance revealed the combined soccer market across the ‘big five’ European leagues contracted by 13 per cent in 2019/20, down to €25.2 billion (US$29.7 billion). It represents the first fall in revenue for more than a decade.
According to Bloomberg, one of Uefa’s aims with its impending plans is to prevent clubs with hugely wealthy owners, such as the Premier League’s Manchester City and Chelsea, as well as Ligue 1’s Paris Saint-Germain, from gaining an even bigger advantage over less affluent teams. The organisation will reportedly partly look to achieve this by introducing new caps on player salaries.
The current FFP regulations, which were first agreed in 2009, are designed to encourage clubs to at least break even and not spend beyond their means. However, critics have argued the rules are ineffective and unenforceable.
Uefa temporarily adjusted its rules in June last year to reflect the revenue lost by teams as result of the pandemic. This includes sides being able to make losses greater than the permitted €30 million (US$35.4 billion) over a rolling three-year period.
However, amid mounting concern within Uefa that spending on wages and transfer fees is getting out of hand, further regulations are expected to be introduced. As well as a potential salary cap, the organisation is also reportedly mulling a luxury cap on transfers.
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