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Manchester United have emerged in the media over the past year as one of the major supporters of the new Financial Fair Play rules, arguing that it will remove the advantages currently enjoyed by clubs with billionaire owners – such as Manchester City and Chelsea- and return power to those who generate the most cash through their own efforts.
Ex chief executive David Gill was a particular supporter of the plan, arguing earlier this year that the Premier League should operate, immediately, what is essentially a salary cap for most clubs. “The impact of the new TV money has clearly focused the minds. Seven or eight clubs are going to have to abide by UEFA’s regulations in any case.” he said.
Yet it appears that the positive view of the football club board is not shared by either the owners of the club nor its lawyers.
A little-known filing with the New York Securities Exchange, linked to the recent flotation of part of the club on the New York Exchange, was required to warn investors about foreseeable risks.
The club was clear that FFP was one of the more serious. It informed investors. “These rules are intended to discourage clubs from continually operating at a loss. However, the implementation of the financial fair play rules, and in particular the potential punishment for non-compliance, remains uncertain.
“There is a risk that application of the financial fair play initiative could have a material adverse effect on the performance of our first team and our business, results of operations, financial condition and cash flow.”