Barcelona may be on brink of failing FFP – no wonder they still back doomed Super League
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The story of Barcelona’s financial decline has been one played out in stages, through the vast transfer spending of the last decade to the most recent summer’s final dribble of funds to acquire Oriol Romeu and now, finally, a reckoning is coming.
In July, the Telegraph reported that Uefa had declared inadmissible in financial fair play compliancy the profits banked from the sale of future income streams – a new variation on an old form of revenue generation that sells the future to sustain the present. The line was finally crossed when Barcelona submitted their FFP calculation for the 2021-2022 season.
Uefa did not just reject the calculation – it fined Barcelona for submitting it. The club’s appeal against that €500,000 sanction was rejected in November. The club only passed FFP because the total consideration was based on aggregate losses over four years but the episode suggested problems in the future.
Now comes the first suggestion that Barcelona have indeed failed to meet Uefa FFP compliancy for 2022-2023, this from the German newspaper Welt Am Sonntag, a claim they are yet to respond to. A rather bitter dessert course to the serving of European Super League triumph that followed the ruling in the European courts this week.
How much of Barcelona’s revenue simply had a line struck through only time will tell but judging by the amounts drawn down from those future revenue sales for the year in question it could be as much as €608 million. The club have already admitted an operating loss without the inadmissible FFP revenue of around €200 million.
Should Barcelona fail Uefa FFP, a fragile club will take a grievous blow. Expulsion from the Champions League next season and perhaps beyond would deprive them of a crucial revenue stream. The club is already drowning in debt, around €1.35 billion accumulated on operation losses over the years. A further €1.5 billion is committed on Espai Barca, their new stadium project. The old Nou Camp has already been knocked down, broken up and carted off.
The club clings to its dream of the Super League and wrestling power from Uefa – although it feels like the longest of long shots. Barcelona has sold 25 per cent of its future television income from La Liga for the next 25 years to the US investor Sixth Street. It has booked profits on the sale of the media subsidiary Barca Studios, although there remains serious doubt over what the market might pay. The club has cut costs to the extent that last summer it effectively stopped paying transfer fees for footballers.
This, it bears repeating, is the club that seeks, along with Real Madrid, to lead European football into a new dawn of competition. A new dawn that includes a new format skewed in favour of established powers and – remarkably it is claimed – a firmer hand on financial regulation. Barcelona, along with Real, and their various advisors on the Super League project, wish to tell everyone else what good financial management looks like and how best to apply it.
Where the Super League goes from here is not yet clear – although the wholesale rejection by the six Premier League clubs who signed up in 2021 suggests that is no obvious path to victory. Its legal case is being run by A22 Sports, an advisory company set up for that purpose by two US financiers close to Florentino Perez, the Real president. For all its obvious disadvantages, the Super League still has contractual obligations from its 12 original members that stipulate €300 million exit penalties.
In an interview this week on Spanish radio station COPE, A22’s chief executive Bernd Reichart would give no guarantee that those penalties will never be enforced. That is the dynamic at the heart of the Real-Barcelona playbook and one card they are unwilling to give up. It is embarrassing for those other 10 clubs who bear the liability. They have already committed €2 million as an initial entrance fee and some clubs have already written that off as a loss.
Under the new Super League format, clubs finishing for the first time in the top four – such as potentially Aston Villa or Girona – would not join the elite division. Instead, they would go into the third tier and would need two further promotions before they were permitted to play the likes of Real and Barcelona. In the same interview, Reichart argued that would be a good thing – that it would allow them time to adapt. You can imagine how that suggestion went down.
The campaign that accompanied the European Court of Justice ruling, from the ESL and A22, was based upon a notion of “freedom” – that football was free, as they saw it, of the tyranny of Uefa’s competition monopoly. Indeed, Uefa is far from perfect and it has largely accepted that it acts at the behest of the biggest clubs. Power is in the hands of those who played the April 2021 breakaway the most shrewdly, and that turned out to be Nasser Al-Khelaifi, the Paris St-Germain chairman.
Yet freedom cannot also mean, for Barcelona in particular, freedom from the potential FFP catastrophe that is heading its way. For years it has spent itself into an astonishing debt and now all those chickens are coming home to roost. Major figures connected to the club, such as its former Champions League winning defender Gerard Pique, have suggested that the only solution is a transition to a private company – although how that might work, no-one has said. Even Perez has promised a “corporate restructure” at Real.
A Uefa FFP sanction now would have far-reaching consequences for Barcelona, coming on top of the club’s many other issues. A sad demise but one of their own making. They tried to blow up Uefa and its competitions and failed. Now it seems Uefa is coming for Barcelona. The consequence of just one more miscalculation from the club.
