UEFA made a ruling on the case of the penalty of AC Milan’s Financial Fair Play violations last Friday. Milan will have to be “break-even compliant” at the end of June 2021 or it will be excluded from two UEFA club competitions.
Milan will also have a limited squad size for the next two seasons, should Milan qualify, and will also have €12 million withheld from this season’s prize money as a penalty.
Uefa sanctions on AC Milan for FFP breaches.... pic.twitter.com/Orz7oHfMBl— Henry Winter (@henrywinter) December 14, 2018
Milan got to this point because the previous ownership groups of Yonghong Li and Silvio Berlusconi spent more than the club earned in profits over the past three seasons. Li’s ownership also submitted business plans to UEFA that were, quite frankly, embarrassing. Marco Fassone had originally submitted a plan that forecast Milan’s revenue from China at €90 million, when in reality, Milan earned a total of €606,000 in revenue from China. Yikes.
Elliott Management has the ability to absorb some losses, unlike the Li ownership group, who borrowed the money to buy the club from Berlusconi from Elliott in the first place. It is not surprising to see such a dim view of Milan’s finances right now, given the circumstances in which Elliott took ownership of the club. Li couldn’t make scheduled capital investments in Milan, borrowed the money from Elliott, and then defaulted on those loans. Elliott took ownership as the largest creditor and in lieu of being paid back for those loans.
The problem, as always when it comes to UEFA, is the selectivity of the enforcement of FFP rules. Other clubs, such as Paris Saint-Germain, Manchester City, Real Madrid, Barcelona, etc, have all run afoul of the rules in the not-so-distant past with little, if any, consequences for their actions.
If FFP is meant to keep clubs solvent, then this is a silly fine to dish out. Elliott has the funds to keep Milan from going bankrupt, just as the petrodollar fueled clubs do. If FFP is meant to “level the playing field” then is an even sillier fine to dish out, as there have been a great number of clubs that have flouted the rules with absolutely no repercussions.
Withholding prize money as a fine? Whatever.