Leaders
Dallmeier

Business Directory

Browse the Directory

Sign Up to the Directory

FC Business Twitter
FC business Linked in
FC Business facebook
FC Business Youtube

Premier League to enforce stronger financial controls

Mon 19th Apr 2010 | Football Governance

The financial collapse of Portsmouth Football Club has prompted the Premier League to consider instituting stronger financial regulations reports the Telegraph. The new rules were discussed at the shareholders meeting on Thursday and they involve putting new owners through a "means testing." This is to make sure that the clubs are in the hands of people who have the necessary funds to keep the clubs in financial strong positions. "The League just want to make sure that it is much more vigilant in future about the finances of those coming in," said a person who attended the meeting.

The "means and abilities test", will involve the owners providing proof of funding and a sustainable long term plan. The League is also going to insist on new owners meeting League officials to avoid the kind of situation that developed with Ali al Faraj when he was owner of Portsmouth and never once visited Fratton Park. The new rules will also allow the League to assess a clubs affairs whenever it changes ownership. Such a rule in the last season may well have helped Portsmouth's problems from steadily increasing. Earlier this season the League adopted rules that require a club to provide a financial plan for the year ahead but the League cannot actually intervene unless independent auditors raise any red flags.

During the Thursday meeting there was also discussion of the increased parachute payments. Premier League has seen a dramatic rise in income from overseas rights and sponsorship and in distributing the money among the clubs it has been decided to give clubs which are relegated four years of parachute payments totalling around £48 million. The clubs will get £16 million in the first two years and £8 million in the next two. Solidarity payments to the rest of the Football League are also going to be increased if FL agrees to a set of steps intended to reduce the gap between the divisions. These steps include declaring club ownership publicly and some improvements in the infrastructural facilities of Championship clubs.

Richard Scudamore, chief executive of the Premier League, also spoke about the League challenging the Ofcom ruling that Sky Sports should reduce the price it charges for distributing content to its rivals. "By forcing Sky to sell its sports channels to its competitors at a discount, Ofcom will reduce the incentives of all broadcasters, Sky included, to invest in the acquisition of sports rights. This can only have a negative impact on the ability of sport to attract a fair return on its content in an open market, which is necessary to ensure appropriate investment in maintaining the highest quality of that content."

Rugby and cricket organisations will support Premier League's appeal to the Competitions Appeal Tribunal, while Sky plans to challenge the ruling on its own also. If these efforts fail, there is the possibility of a judicial review.

Add to: Google Google | Yahoo Yahoo | Live Live | del.icio.us del.icio | Digg Digg |

Related Articles

FC Barcelona Appoint New Strategic Advisor In America

Thu 13th Jul 2017 | Football Governance

Former U.S. Ambassador to Spain and Andorra signs agreement with the club to serve in the new role. FC Barcelona and James Costos, the former United States Ambassador to Spain and Andorra, have signed...

Career Platform Launched For Elite Sports Professionals

Mon 19th Jun 2017 | Football Governance

Pro-footballer Robbie Simpson launches careers platform for sports professionals Sports professionals and elite athletes can now find new careers after sport with the help of a recruitment platform...

LaLiga Strengthens MLS Ties

Wed 24th May 2017 | Football Governance

LaLiga and Major League Soccer (MLS) are establishing closer ties and stepping up their collaboration. Academy directors, coaches and officials from several franchises in the highest tier of the...

A significant moment for The FA, as governance reforms confirmed by shareholders

Fri 19th May 2017 | Football Governance

The Football Association has agreed a new set of corporate governance reforms which will meet and comply with Sport England’s Code for Sports Governance. On Thursday afternoon, FA Shareholders...