June 2024 Roundup
A roundup of football law news and decisions from June 2024:
Manchester City FC bring claim against the Premier League
Manchester City FC (“MCFC”) has brought a claim against the Premier League (“PL”) in respect of the PL’s rules on associated party transactions, and, in particular, it is understood, those rules that were introduced in February 2024, as explained in Football Law’s March 2024 Roundup.
Full details of the claim are unknown, although news reports from The Guardian, BBC Sport, The Times (£) and The Telegraph (£) provide some insight.
It is understood that the hearing of the claim started on 10 June 2024 and was to last two weeks. There is no provision in the PL rules for a public announcement in respect of, or publication of, any decision (see PL Rules, r. X.31).
Reading FC Women
Reading FC Women (“RFCW”) has withdrawn from the Barclays Women’s Championship (“the WC”) for the upcoming 2024/25 season and will instead play in the Women’s Football Pyramid at Tier 5.
An announcement from the WC explained that RFCW will ‘not be able to meet the ongoing compliance requirements needed to continue to operate in the Barclays Women’s Championship next season’.
The announcement further explains:
‘[…] following the club’s decision to withdraw from the Barclays Women’s Championship, the Women’s Football Board has subsequently accepted the club’s application to re-enter the Women’s Football Pyramid, and they will do so in the Southern Region Football League Premier Division [Tier 5] from the start of the 2024/25 season. This decision has been made by the Women’s Football Board in order to protect the integrity of the Women’s Football Pyramid and the welfare of the players and staff members at the club’.
The requirements for competing in the WC are explained in Football Law’s overview ‘The FA Women’s Super League and the FA Women’s Championship’.
Oxford United FC
Oxford United FC (“OUFC”) successfully appealed against the imposition of a sanction automatically imposed by EFL Regulations, reg. 52.6.3(b) and (c) relating to late payment of money owed to Sunderland AFC.
The automatic sanction imposed on OUFC was a fine of £3,500 and a three-transfer-window Fee Restriction (as defined in the EFL Regulations).
OUFC was permitted to appeal against the automatic sanction pursuant to EFL Regulations, reg. 52.6.4:
‘Where a Fee Restriction is imposed under this Regulation 52.6 the Club may appeal to a Disciplinary Commission (within 21 days of the Fee Restriction being applied) such sanction in circumstances where it can prove:
(a) any debt counting towards the Persistent Default was not due and owing at the time; or
(b) the sanction applied to it is disproportionate taking into account all the circumstances’.
OUFC appealed and was successful in reducing the three-transfer-window Fee Restriction to one transfer window, suspended for two years on condition that there is no further breach of EFL Regulations, reg. 52.6.3 in that two-year period. OUFC was still required to pay the £3,500 fine.
The written reasons for the decision are available here and, at paragraphs 24 to 25, demonstrate an application and consideration of the approaches seen earlier this year in similar appeals made by Swindon Town FC and Doncaster Rovers FC (as explained in Football Law’s January 2024 Roundup).
Significant points in OUFC’s favour were:
OUFC’s breach of EFL Regulations, reg. 52.6.3 was caused by an ‘administrative oversight’ (see paragraph 28 of the written reasons);
OUFC addressed the breach as soon as it was notified of the same (see paragraph 33 of the written reasons); and
A Fee Restriction for three-transfer windows or even one transfer window would ‘significantly [hamper OUFC’s…] ability to compete in the EFL Championship for the 2024/24 Season’ (see paragraphs 35, 39, 44 and 45).
Southend United FC
Southend United FC (“SFC”) has received a request from the National League (“NL”) to deposit £1 million into an escrow account following concerns the NL has about SUFC’s ‘ability to fulfil its financial obligations for the forthcoming National League Season’.
The NL’s statement identifies that the sum will be held in escrow until the sooner of:
‘(i) an ownership agreement with the consortium currently in talks with the Club being successfully concluded, to the satisfaction of the National League and the FA; or (ii) the Club demonstrating, to the satisfaction of the National League, that is has sufficient financial resources within its own means to meet its financial obligations for the forthcoming Season’.
The NL statement also identifies that SUFC may be subject to sanctions if they fail to comply with the request.
SUFC responded acknowledging the NL’s request, and recent reports identify that the proposed takeover is nearing completion, and that a winding-up petition against SUFC has recently been dismissed.
SUFC has the right to appeal against the NL’s request pursuant to rule 4.3 of the FA Standardised Membership Rules.
FA Governing Body Endorsement
The FA has released its Governing Body Endorsement criteria and application forms for the 2024/25 season, which are available here.
PL to trial alternative financial regulations
As indicated in Football Law’s April 2024 Roundup, the PL has taken an initial step in considering changes to its current Profitability and Sustainability Rules. On 6 June 2024, the PL announced that at its annual general meeting PL clubs had:
‘… agreed to trial an alternative League-wide financial system next season (2024/25) on a non-binding basis.
The existing Profitability and Sustainability Rules (PSR) will remain in place, but clubs will trial Squad Cost Rules (SCR) and Top to Bottom Anchoring Rules (TBA) in shadow.
This will enable the League and clubs to fully evaluate the system, including the operation of UEFA’s equivalent new financial regulations, and to complete its consultation with all relevant stakeholders’.
PL swap deals
Several clubs have conducted significant player transfer “swap deals” ahead of the 30 June which appear to be for PSR-compliance purposes (see Football Law’s article ‘Seeing the Wood for the Trees’ for the significance of the 30 June deadline).
As explained in this BBC Sport article, deals worth £185 million have already been completed (with the transfer window having only opened on 14 June 2024).
Concerns have arisen as to whether such swap deals are being constructed by and between some clubs to avoid breaching the PSR’s upper loss threshold of £105 million over the relevant three-year assessment period. This BBC Sport article from Dan Roan and featuring Kieran Maguire provides a very helpful explainer of these concerns.
On 27 June 2024 it was reported that the PL had written to PL clubs to ‘explain its rules regarding the fair valuation of players involved in transfers’ (see PL Rules, rr. A.1.19, A.1.243, and E.60-E.64, and Appendix 19).
It should also be noted that PL clubs are under an obligation to act with 'utmost good faith', which includes not engaging 'in conduct that is intended to circumvent these Rules or obstruct the Board’s investigation of compliance with them' (PL Rules, r. B.15.2).
There is no suggestion and there has been no announcement that any PL clubs are being investigated and/or that there is any suspected breach of the PL Rules.
EFL to consider alternative financial regulations
On 7 June 2024 the EFL announced that it will be considering revisions and changes to the Championship Profitability and Sustainability Rules and the League One and League Two Salary Cost Management Protocols.
Legality of FIFA Club World Cup 2025 challenged
On 13 June 2024 FIFPRO announced that its member unions the Professional Footballers’ Association (“PFA”) and the Union Nationale des Footballeurs Professionnels have, with support from FIFPRO Europe, submitted a legal claim against FIFA ‘challenging the legality of FIFA's decisions to unilaterally set the International Match Calendar and, in particular, the decision to create and schedule the FIFA Club World Cup 2025’.
In a lengthy statement, FIFPRO explained that the challenge alleges that FIFA’s decisions ‘violate the rights of players and their unions under the EU Charter of Fundamental Rights while also potentially violating EU competition law’.
FIFPRO’s statement also provides the following helpful summary of the questions sought to be referred to the European Court of Justice:
‘Does FIFA, by unilaterally and discretionarily imposing an International Match Calendar, and, more specifically, a new competition entitled ‘FIFA Club World Cup 2025’, infringe the rights that workers and trade unions derive from the CFREU and EU competition law? More specifically, does the unilateral imposition of such decisions on the players violate the right enshrined in Article 28 of the CFREU for those players to collectively bargain their terms and conditions of employment, via their trade unions?’
The PFA’s statement on the announcement of the legal challenge is also available here.
FIFA Integrity Handbook
FIFA has released its second edition of the FIFA Integrity Handbook, which is available here.
FIFA Statutes updated
FIFA Circular no. 1889 dated 7 June 2024 identifies that the updated FIFA Statutes come into force on 16 July 2024 and attaches a copy of the same.
1 July 2024