UEFA and Football Governance A New Model

CENTRE INTERNATIONAL
D’ETUDE DU SPORT
UEFA and Football Governance: A New Model
Adaptations for the challenges of modern football
Final Project Work
International Master (MA) in Management, Law and Humanities of Sports

2002/2003
30/06/03
By
Pierre Ducrey, Carlos Eduardo Ferreira, Gabriel Huerta, Kevin Tallec Marston
Note: This document has been updated since 30/06/03 but only takes into account information public up to 31/12/03.
Copyright © 2003 Ducrey, Ferreira, Huerta and Marston
All Rights Reserved
TABLE OF CONTENTS
ACKNOWLEDGEMENTS ------------------------------------------------------------------------------------------- 5
PROLOGUE ------------------------------------------------------------------------------------------------------------- 6
INTRODUCTION ------------------------------------------------------------------------------------------------------- 7
I. Aim --------------------------------------------------------------------------------------------------------------------- 7
II. Paper Structure and Scope -------------------------------------------------------------------------------------- 7
III. Research Methods and Constraints --------------------------------------------------------------------------- 8
CHAPTER ONE: BACKGROUND -------------------------------------------------------------------------------- 11
1.1. STRUCTURE OF E UROPEAN FOOTBALL -------------------------------------------------------------------- 11

1.1.1. Governance and Football – The Pyramid Structure-------------------------------------------------- 11
1.1.2. The European Football Industry --------------------------------------------------------------------------- 14
1.1.3. Stakeholders’ Map -------------------------------------------------------------------------------------------- 22
1.1.4. Professional Football Competition Calendar ----------------------------------------------------------- 26
1.2. MODERN ISSUES ----------------------------------------------------------------------------------------------- 29
1.2.1. Football and Globalisation ---------------------------------------------------------------------------------- 29
1.2.2. Football and the European Union ------------------------------------------------------------------------- 32
CHAPTER TWO: THE ACTORS ---------------------------------------------------------------------------------- 35
2.1 UEFA AND NATIONAL ASSOCIATIONS --------------------------------------------------------------------------- 35
2.1.1. The Birth of UEFA -------------------------------------------------------------------------------------------- 35
2.1.2. UEFA’s Mission ----------------------------------------------------------------------------------------------- 36
2.1.3. UEFA’s Organisation ----------------------------------------------------------------------------------------- 39
2.1.4. The Relationship with National Associations ----------------------------------------------------------- 41
2.1.5. Solidarity – “We Care About Football” ------------------------------------------------------------------- 42
2.1.6. UEFA’s Finances --------------------------------------------------------------------------------------------- 43
2.1.7. UEFA’s Latest Developments------------------------------------------------------------------------------ 46
2.2 NATIONAL L EAGUES ------------------------------------------------------------------------------------------------ 51
2.3 THE CLUBS ----------------------------------------------------------------------------------------------------------- 53

2.3.1. Clubs and the Demand for Football ---------------------------------------------------------------------- 54
2.3.2. The Pursuit of the Goals ----------------------------------------------------------------------------------- 56
2.4 G-14 ------------------------------------------------------------------------------------------------------------------ 60

2.4.1. The Legal Form of G-14 ------------------------------------------------------------------------------------- 60
2.4.2. The Creation of the Grouping ------------------------------------------------------------------------------ 61
2.4.3. Objectives ------------------------------------------------------------------------------------------------------- 62
2.4.4. Structure of G-14 ---------------------------------------------------------------------------------------------- 62
2
TABLE OF CONTENTS
CHAPTER THREE: THE CONFLICTS --------------------------------------------------------------------------- 65
3.1 CONVERGENCES AND DIVERGENCES OF INTERESTS ---------------------------------------------------------- 65

3.1.1. UEFA and the Leagues ------------------------------------------------------------------------------------- 66
3.1.2. UEFA and Clubs ---------------------------------------------------------------------------------------------- 68
3.1.3. Leagues and Clubs ------------------------------------------------------------------------------------------- 70
3.1.4. G-14 and Other Clubs --------------------------------------------------------------------------------------- 71
3.2 PAST CONFLICTS B ETWEEN TOP CLUBS (G-14) AND UEFA ----------------------------------------------- 73
3.2.1. Competition ----------------------------------------------------------------------------------------------------- 73
3.2.2. Revenue Distribution ----------------------------------------------------------------------------------------- 75
3.2.3. Other Areas of Conflict -------------------------------------------------------------------------------------- 77
3.2.4. Representation ------------------------------------------------------------------------------------------------ 80
3.3 SCENARIOS OF P OTENTIAL D EVELOPMENTS OF THE CONFLICTS ------------------------------------------- 82
3.3.1. The Cold War of European Football --------------------------------------------------------------------- 83
3.3.2. Competition ----------------------------------------------------------------------------------------------------- 85
3.3.3. Revenue Distribution ----------------------------------------------------------------------------------------- 86
CHAPTER FOUR: CONFLICT MANAGEMENT OUTSIDE EUROPEAN FOOTBALL ------------- 88
4.1 CASE STUDIES ------------------------------------------------------------------------------------------------------- 88

4.1.1. “Clube dos Treze” in Brazil --------------------------------------------------------------------------------- 88
4.1.2. The GPWC and Formula One ----------------------------------------------------------------------------- 90
4.1.3. The IOC Athletes’ Commission ---------------------------------------------------------------------------- 93
4.1.4. The Professional Cycling Council ------------------------------------------------------------------------- 95
4.2 GENERAL LESSONS LEARNED ------------------------------------------------------------------------------------- 97
CHAPTER FIVE : A POSSIBLE SOLUTION ------------------------------------------------------------------- 101
5.1 STRUCTURAL PROPOSAL ------------------------------------------------------------------------------------------ 101

5.1.1. Convergence of Key Stakeholders ----------------------------------------------------------------------- 101
5.1.2. The Proposed Model – An Expanded Dialogue ------------------------------------------------------- 102
5.1.3. The European Professional Football Council ---------------------------------------------------------- 105
5.1.4. The New European Club Forum -------------------------------------------------------------------------- 106
5.1.5. Advantages of the New Model ----------------------------------------------------------------------------- 107
EPILOGUE --------------------------------------------------------------------------------------------------------------- 109
ABOUT THE AUTHORS --------------------------------------------------------------------------------------------- 110
3
TABLE OF CONTENTS
REFERENCES ---------------------------------------------------------------------------------------------------------- 111
I. LIST OF G RAPHS AND TABLES -------------------------------------------------------------------------------------- 111
II. BIBLIOGRAPHY -------------------------------------------------------------------------------------------------------- 112
III. INTERVIEWS -------------------------------------------------------------------------------------------------------- 116
IV. PRESENTATIONS --------------------------------------------------------------------------------------------------- 116
V. SPEECHES ---------------------------------------------------------------------------------------------------------- 117
VI. W EBSITES ----------------------------------------------------------------------------------------------------------- 117
APPENDICES ----------------------------------------------------------------------------------------------------------- 119

a. List of National Associations Members of UEFA ----------------------------------------------------------------- 119
b. UEFA Solidarity Programmes ---------------------------------------------------------------------------------------- 120
c. G-14 European Football Clubs listed on the Stock Exchange ------------------------------------------------ 122
d. G-14 Voting structure ---------------------------------------------------------------------------------------------------- 123
4
ACKNOWLEDGEMENTS
As a group we would like to express our gratitude to all those who contributed to this work and
especially those directly involved in generously giving of their time to share their views and experience
which proved to be an essential part of this project.
Jaime Andreu-Romeo - Head of European Sport Unit, European Commission

Leonardo Nascimento de Araújo - AC Milan and FIFA World Cup Champion ‘94
John Barton – T.E.A.M. Marketing
Geneviève Berti - Communications Manager of G-14
Marco Brunelli - Lega Calcio and our tutor
Richard Bunn - TV and Media consultant
Michele Centenaro - Senior Product Manager, Club Competitions, UEFA
Jérôme Champagne - Deputy Secretary General, FIFA
Jean-Paul de la Fuente - Founding Director, Deureka
Peter Gilliéron - General Secretary, Association Suisse de Football
Michel Guénaire - Head of Sport-Law Division, Gide, Loyrette et Nouel, Paris
Rodolfo Hecht - President, Media Partners Group
Jonathan Hill – Head of EU Representative Office, UEFA
Gianni Infantino - General Counsel Commercial Legal Services, UEFA
Thomas Kurth - General Manager of G-14
Antonio Marchesi - Senior Partner, Deloitte and Touche Sports, Italy
Lars-Christer Olsson - Director of Professional Football and Marketing, UEFA
Denis Oswald - IOC member and President of FISA (International Rowing Federation)
Alex Phillips- Senior Product Manager, Professional Football, UEFA
Arnaud Rouger- Legal Advisor, LFP (Ligue de Football Professionnel – France)
Freddy Rumo- President of Executive Board of Neuchâtel Xamax FC and former UEFA Vice President
Jefferson Slack- Director, Inter Active, FC Internazionale Milano
Stefan Szymanski - Professor of Economics, The Business School, Imperial College London
Alain Rumpf – Coordinator of the Professional Cycling Council, International Cycling Union (UCI)
Additionally we would like to thank UEFA -Divi sion of Services, especially Barbara Rodel, Division of
Professional Football and Marketing, especially Marion Haap, Lucia Castelli at Atalanta Bergamasca
Calcio, Ruth Beck-Perrenoud from the Olympic Museum for her help in research, our professors at
DeMontfort University (Leicester, UK), SDA Bocconi (Milan, IT) Université de Neuchâtel, (Neuchâtel,
CH), the CIES and FIFA, sponsor of the International Master, especially Vincent Monnier.
Finally we thank our families and friends for their patience, support and inspiration, especially during
the last phase of this project.
5
PROLOGUE
The headlines of sport news sections have been filled with tension-riddled declarations from football
club managers toward football’s organisers about too many matches, national team call-ups at key
points in the season and concern over players victim of injuries during “useless international
friendlies.” The response is sometimes swift, sometimes harsh, but always illustrative of the conflicts
between the members of the so-called football family. We recognise that all families have conflicts,
some tragic, others trivial, but we were struck by the intensity of this banter internally sewing a frown to
football’s countenance while still outwardly presenting a naïve smile. We began to analyse the
relationships and gradually realised that there were some family members with serious concerns who
were not addressing each other.
We heard the uproar from major club figureheads when UEFA took the nth decision to change its prize
event, the Champions League. We also felt the inescapable force of commercialised-globalisation
when Brazilian international players flew half-way across the world to China for 90 minutes of football
worth US$ 1 million. We shed a tear when Italian legend AC Fiorentina were dissolved and Angelo
DiLivio, a FIFA World Cup finalist, voluntarily descended to the fourth and final professional division
and set out to paint the second Florentine renaissance, this time named Florentia Viola. We love
football and we have a great interest to see the beautiful game continue to flourish to the ends of the
Earth. Thus when we saw these unresolved dissonances spreading through the game, we made the
decision to throw ourselves into the melee and clarify who the actors were, what their interests were
and how they were relating to each other. After surveying the field we chose to focus on the clubs and
UEFA, and then more specifically on the group of clubs creating the most commotion, the G-14. Their
name seemed to pop up everywhere from the headlines, to the European Commission but never from
UEFA.
We found the door, brushed aside the coats and stepped into the magic wardrobe of UEFA, G-14 and
European Football. . .
6
INTRODUCTION
I. Aim
The final aim of this project is to propose some adjustments to the current governance model of
European football in order to address the conflicts arising from the pressures of the modern sport.
In order to do that we began our work by narrowing to one overriding question about governance “How
do international sport governing bodies adapt and respond to the pressures of lobby groups?”, looking
specifically to the case of UEFA and G-14. With this overriding question in mind, we structured our
project to answer the following questions:
1. What are the conflicting circumstances within the governance of European football that are
bearing the rise of such lobby groups?
2. How efficiently are those conflicting circumstances being addressed by the pertinent actors?
3. What are the main risks to the sport that can arise from the process in which the conflicts are
being managed, and how can those risks be mitigated?
II. Paper Structure and Scope

The structure of this paper is sub-divided in five chapters: In the first chapter we present the field of
play and provide some background information on the stage and scenario in which the main actions
take place. We will demonstrate the current governance structure of European football, briefly touch
on the peculiar dynamics of the football industry, present the major relevant stakeholders, their
interests and inter-relationships and illustrate the complexity of the competition calendar of
professional football in Europe. This information will be relevant for the complete understanding of the
issues treated in the paper.
The second chapter presents the major actors involved in the production of the spectacle of European
football. Although we recognize that the media and the major sponsors are important enablers in the
distribution and popularisation of European football and its influence over the shaping of the game has
been growing along the years, we have chosen to focus the scope of our analysis on the clubs (and
with them, the G-14), the national associations, the leagues and UEFA, as we believe those are still
the most influential actors in the design of football as a product.
After presenting the major actors, in the third chapter we analyse the convergences and divergences
of interests among them, the main areas of conflict and the potential risks that such conflicts can
impose to the future of European football.
We then take a break at chapter four and look outside European football in the search for examples of
conflict management at similar sporting contexts. Our objective with chapter four is to learn some
lessons that could be applied in the process of defining our final recommendations for the present
case.
7
Finally, in chapter five we present a model with recommendations for adjustments to the current
governance of European football, with the aim of minimizing the conflicts and tensions among the
members of the Football Family.
Although UEFA has a broad range of activities touching on every discipline of association football in
Europe, the scope of this paper is limited to elite professional men’s football, as this is currently the
only form of the game that has achieved significant commercial potential. And it is not until significant
flows of money begin to pour over a sport that the major conflicts among different stakeholders start to
surface.
III. Research Methods and constraints

Our research was carried out during May and June 2003. It has been structured around a hypothesis-
driven approach, a methodology commonly used by management consulting firms. The approach
consists in five major steps as shown in Figure I:
Figure I – The hypothesis-driven

approach
1 2 3 4 5
Overriding Analyses &
Issue tree Hypotheses Research
question Conclusions
1. Overriding question
The Overriding question is the ultimate question the project aims to answer. As mentioned before, we
have defined it as: “How do international sports governing bodies adapt and respond to the pressures
of lobby groups?”
2. Issue tree
The second step consists in identifying the relevant issues that need to be addressed in order to
answer the overriding question. The issue tree is a hierarchical structure of questions that will be
answered during the project leading to the final answer to the overriding question. For this paper we
have defined three main issues and a set of 24 sub-issues in two different levels as shown in Figure II.
3. Hypotheses
Once the issue tree has been defined we have generated the hypotheses for the project. The
hypotheses are tentative answers to the issues based on the authors’ intuition and background
knowledge on the subject. They may be proved right or they may be discharged after the research and
the analyses are conducted. The importance of generating a sound set of hypotheses is that it
provides the group with a comprehensive overview of the project’s main messages at its very
beginning.
4. Research
8
In this step we have designed the analyses that needed to be conducted to prove or discharge our
hypotheses. Based on that set of analyses, we defined the input data to be gathered and determined
their potential sources.
Input data was collected through the following methods:
• Preliminary interviews with representatives of UEFA and G-14 to validate the soundness of the
initial list of hypotheses.
• Interviews with representatives of sport governing bodies, football clubs, national associations,
national leagues, governmental bodies, sports mark eting companies, media companies, lawyers,
economists, players and industry analysts to capture the different views on the subject and its
potential developments.
• Review of official documents provided by G-14 and UEFA, besides books and papers from
academics on matters concerning the scope of our project.
• Search and review of websites of official governing bodies, clubs, and specialized sport press for
relevant news and archive materials.
• Final interviews with UEFA and G-14 to discuss and validate our preliminary findings.
5. Analyses and conclusions
After finishing the process of data gathering we have conducted the analyses necessary to prove or
discharge the hypotheses and have drawn our final conclusions .
Research Constraints
Although the hypothesis-driven approach adds focus and drive to the project, speeding up the problem
solving process, this project was conducted along six weeks of full-time work and there is some
limitation to what can be achieved in such a reduced time frame. Notwithstanding, we have been
fortunate by the fact that some of the major exponents in the European football industry were
extremely collaborative and candid about the subject, allowing us to conduct twenty three high-level
interviews across four different countries covering representatives of and experts on all main
stakeholders involved in the subject.
Precisely because of time constraints, we have not been able to directly interview executives from TV
companies or sponsors, nor have we been able to conduct quantitative analyses on the opinion of
fans as far as the issues touched by this paper are concerned. Our conclusions with regards to those
groups of stakeholders are based on interviews with industry analysts and any available research
material published on the subject.
With respect to research materials we have been able to obtain the majority of information needed to
prove or discharge our set of hypotheses, perhaps with the exception of conclusive empirical data
about the determinants of demand for sport. This would be particularly useful in allowing the design of
more precise scenarios for the future of the game, and further research in this area might prove
valuable.
9
Figure II – The original project issue tree
(as designed in the first group meeting)
Overriding question
How do international sport governing bodies adapt
and respond to the pressures of lobby groups? The
case of UEFA and G14
Issue A
What are the conflicts within the internal structure of European
Football and why are they arising?
A1 A2 A3 A4
What are the interests of What are the general How do those interests What additional factors
UEFA? interests of the clubs? interplay? could be creating /
amplifying conflicts?
How does UEFA pursue How do top clubs pursue What are the areas of
A1.1 those interests? A2.1 those interests? A3.1 convergence?
How do those interests How do other professional What are the areas of
A1.2 represent the views of the A2.2 clubs pursue those A3.2 divergence?
member associations? interests?
How do amateur clubs

A2.3 pursue those interests?
Issue B
How efficiently are those conflicts being managed?
B1 B2 B3
How have past conflicts What are other examples What lessons can we
been managed? of conflict management in learn from those
sports? examples?
Issue C
What risks can arise for the sport from the management of such
conflicts and how can those risks be mitigated?
C1 C2 C3
What if UEFA rigidly fixes What if UEFA adopts a How can UEFA adopt a
its position against the reactive role towards the proactive model to solve
Lobbying group? conflict? conflicts?
What are the threats for What are the most

C1.1 UEFA coming from G -14? C3.1 sensitive areas to be
considered by this model?
What are the threats for What are the key success
C1.2 G-14? C3.2 factors for the model?
What would be the How should the model be

C1.3 consequences of those C3.3 designed?
threats if carried out?
10
CHAPTER ONE: BACKGROUND
1.1. STRUCTURE OF EUROPEAN FOOTBALL
1.1.1. GOVERNANCE AND FOOTBALL – THE PYRAMID STRUCTURE

The governance of association football resembles a pyramid where each layer takes on different
responsibilities in different geographical scope. The formation of this pyramid has historical roots in the
early stages of organized football in Britain and it has not been a uniform process.
th
As Britain changed from an agrarian to an industrial society in the late 18 century, the games played
in the open fields of the countryside were adapted to suit the narrow streets and hard surfaces of the
new urban communities. The leisure time determined by sun, seasons, and feudal obligation was
replaced by the much more restricted leisure hours decreed by the artificial light of the factories and
the needs of the owners. Improvements in roads and transportation allowed games to be played
outside the local village, and as steam trains started to link the ever growing towns of Britain, it
became possible to play on a national basis the games that the middle class favoured and promoted.
1
This expanding scope involved agreement on rules and the formation of a national governing body.
And that is where the pyramid begins to be formed. With the spread of the sport around the world, the
pyramid started evolving from a local and national to an international scope and finally reached its
current form as shown in Figure 1.1:
Figure 1.1: The pyramidal structure of European football
FIFA
UEFA
National National
Leagues Associations
REGIONAL ASSOCIATIONS
CLUBS
The clubs
The clubs are the basic cell and the foundation of the pyramid. Originally founded as local associations
their initial objective was to offer the local community the possibility of engaging in the sport, thereby
promoting the idea of “sport for all”. With the introduction of a regular competition, The FA Challenge
1
MURRAY Bill, The world’s game – a history of soccer, University of Illinois Press, 1998, p.2
11
Cup in 1871, spectator crowds in England began to increase dramatically and in 1901 a crowd of
2
110,820 turned up to see Tottenham Hotspur and Sheffield United contest the final of the trophy .
These crowds were increasingly giving birth to the popularisation of football as a spectator sport.
Today, the main objective of top professional football clubs has shifted from the offer of opportunities
to engage in the practice of the sport, to the offer of the spectacle of the game and all the attached
psychological, emotional and social benefits for the fan. But the clubs still remain the basis and the
primary link of contact with the communities.
Regional associations
Regional associations form the next level; although this form of association is not present in all
countries. Clubs are usually affiliated to these organisations. Their scope of action is limited to a region
within a country in which they are responsible for organising regional championships or coordinating
the sport.
National associations
The first national association to come into scene was the English Football Association, or simply the
FA as it is known today. It emerged from the London FA that became virtually the sole authority for the
game in England after different regional associations in England came to a compromise agreement in
1877. By 1905 it had achieved the mark of 10.000 local clubs affiliated to it. The success of the
London FA in establishing its control over other regional associations came with the popularity of the
3
Challenge Cup, instituted in 1871, a competition that is still played today. Also helping to secure the
4
success of the dribbling game was the regular match with Scotland which began officially in 1872.
Today, national associations besides organizing club competitions and being responsible for the
coordination of a national team to represent the country in international competitions are also the
supreme regulatory and disciplinary body of the sport within the national boundaries, although, as we
will see later, they have limited autonomy and have to abide by the rules of UEFA and FIFA. By doing
this they are granted a monopolistic position in the national organization of the game, as FIFA as the
ultimate body in the pyramid will only recognize one association per country.
National Leagues
5
Some countries such as France, Italy or England know another form of organisation with the
introduction in the structure of national leagues. The origin of leagues dates back to the England of the
th
end of the 19 century. In 1885, after a series of complaints about athletes accepting money and the
creation of committees to deal with them, followed by threats of serious punishments, the FA legalized
professionalism. This meant that players had to be given a regular income. The Challenge Cup was
still the main competition. Being a knock-out competition, even the best teams could be eliminated in
an early round being left with nothing to do. The answer was the Football League. The league was
2
: Ibid, p.9
3
Ibid, p.6
4
Ibid, p.7
12
made up of selected teams that agreed to play one another on set dates, on a home and away basis,
and promised to field their strongest teams and to give league matches preference over all others. The
individuals engaged in the discussions about the new league were essentially self-made men, small
business owners and industrialists who came from a social category different from that of the men of
the FA. With the FA watching anxiously, discussions were held by those in favour of the league. On 8
September 1888 the new football league kicked off competition with twelve teams. A constitution
would be drawn up determining issues such as points scoring system, how to share the gate money,
and later, a system of promotion from and relegation to a second division. According to its founder and
guiding spirit, the Scottish-born Birmingham businessman William McGregor, the aim of the league
was to protect the interests of the clubs taking part in its competition. He openly declared that “the
league should never aspire to be a legislating body… by the very nature of things the League must be
a selfish body.” The English Football League conceded the right of the FA to control football in all
areas but the organisation of league competition. This meant that the FA was left to control the
Challenge Cup, internationals, amateur football and certain matters concerning the rewards and
6
disciplining of the professionals.
Today, the relationship between national leagues and national associations throughout Europe is very
th
similar to the one verified in England in the late 19 century. While the national association is
responsible for the control and development of all aspects and disciplines of football within the national
boundaries, the league’s main interest is the commercial development of its major product, a league
competition. Although there are tensions from time to time, the two bodies co-habit in relative peace
given their share of common interests on the game.
UEFA
The next level of the pyramid is formed by the continental confederations, or more specifically in the
case of Europe, UEFA – The Union of European Football Associations. As the name suggests, UEFA
7
is formed by 52 national associations . It is the governing body of football on the continent of Europe
and has as its core mission to safeguard the development of European football at every level of the
game and to promote the principles of unity and solidarity, as we will detail later. Along the same lines
of the national associations UEFA enjoys a monopolistic position on the organisation of the game in
Europe, guaranteed by the pyramid structure.
It is relevant to notice that unlike the reality at the national level, where a league takes from the
national association the responsibility of organizing and commercially developing an elite competition
among clubs, the figure of the league does not exist at the continental level. The task of organizing
and commercialising European club competition falls into UEFA’s direct jurisdiction.
5
The elite club competitions are respectively organised in these countries by the ‘Ligue Nationale’, ‘Lega Calcio’ and the
‘Premier League’.
6
MURRAY Bill, The world’s game – a history of soccer, University of Illinois Press, 1998, p.11
7
See a complete list of UEFA’s member associations at appendix a.
13
FIFA
FIFA, is the supreme authority of football in the world. Its creation, in 1904, precedes that of the
continental confederations, and thus, its membership structure is also formed by national associations.
Technically, the continental confederations, like UEFA, are not members of FIFA, but are recognized
bodies and have the right to elect the vice presidents and members of FIFA’s Executive Committee.
FIFA’s purpose is to promote and develop the game of football throughout the world, and to be the
guardian of the regulations of the game. Unlike national associations, national leagues and continental
confederations, FIFA currently does not organise club football competitions, although it regulates over
matters that impact club football reality, such as transfer systems, and the coordinated international
calendar. FIFA’s activities as far as competition organisation is concerned are currently limited to
international competitions among national teams.
FIFA is responsible for holding the whole pyramid together. The ownership of the FIFA World Cup,
8
the most important single sporting event in the world, and a large and universal membership base are
its main sources of power. By making use of regulations such as the need for a national association to
9
be a member of a continental federation for two years before being granted membership to FIFA , and
by obliging continental confederations to comply with and enforce compliance with the FIFA statutes,
regulations and decisions, and to ensure that international leagues or any other such combination of
10
clubs or leagues shall not be formed without its consent and approval of FIFA , or by prohibiting
affiliated national associations and their clubs to play matches or entertain other sports contacts with
11
associations which are not affiliated to FIFA or with clubs belonging to them without FIFA’s consent ,
it guarantees that the layers and the monopoly of the pyramid in the organisation of football are
respected.
1.1.2. THE EUROPEAN F OOTBALL INDUSTRY
Definition of the Football Industry
Many people resent the use of the term ‘business’ to describe the activities performed by the main
actors in the European football scenario. However, it is undeniable that European football has
undergone an accentuated process of commercialisation, especially in the last fifteen years, which has
brought significant amounts of money into the game.
Instead of engaging in an emotional and semantic discussion to determine if football is a game, if it is

a business or if it is as much a business as it is a game, we will define as football business the group
of commercial activities performed by the actors in the football industry, and we will define as football
industry the group of legal entities whose commercial activities are rooted in the game of football.
However, such a definition of the football industry is a very broad one and for the purpose of this paper
it needs to be narrowed down as proposed in Figure 1.2.
8
FIFA has currently 204 member associations (one per country), which represents a larger membership base than the UN.
9
FIFA Statutes, art 4, par. 1
10
FIFA Statutes, art. 9, par. 3
14
Figure 1.2 – The structure of the football industry12
Sports Industry
Football Other Sports
Facility Sport
Sporting goods dependent consultation
sports services services
Spectacle Hybrid Participant

sport Sport Sport
National team Participant

Club Football
Football services
Spectator Sponsorship Media Licence

services services services services
Scope of this paper

Outside the scope of this paper
The product-based typology proposed in Figure 1.2 divides the sport industry into three main
segments: Sporting goods, Facility dependent sports services and Sport consultation services.
• Sporting goods: companies producing apparel, shoes, equipment, team and/or league
merchandise, ‘sport’ licensed products. Examples of companies in this segment include Nike,
Adidas and Reebok.
• Sport consultation services: companies supplying advice in areas such as management, medical,
design, building and maintenance, programming, among others. Examples include IMG, Octagon,
and InFront.
• Facility dependent sports services: organisations offering sport as their end product be it as
spectacle (matches, competitions) or as access to participation. This segment, like the others, can
be further subdivided in three categories: spectacle, participant and hybrid sport.
– Spectacle sport: the most prominent feature of organisations in this category is the ability to
generate substantial revenues directly or indirectly from spectators. Here, athletes are usually
professionals. Examples of organisations in this category are Manchester United, Juventus and
the English Premier League.
11
FIFA Statutes, art. 57, par. 1
12
Adapted from WESTERBEEK & SMITH, Sport Business in the Global Marketplace, Palgrave, 2003, p.87
15
– Participant sport: this is the category of entities providing opportunities for people to engage in
sporting activities, usually on a non-professional basis, like gyms, community sports centres
and amateur sport clubs.
– Hybrid sport: in this category, sports organisations offer a mix of spectacle and participant
13
sport. As Westerbeek and Smith point out, governing bodies are likely to be hybrid sport
organisations as they are charged with developing a mass participation base for the sport with
the ambition of securing its longevity, while encouraging and promoting the few outstanding
athletes that can perform in elite spectacle sport, providing the sport with the exposure so
essential to its popularity, while developing the basis for spectacle sports’ revenue streams.
Once the segmentation is understood, we can then define the European Football Industry in this paper
as the group of legal entities acting in the facility dependent sports services, specifically within the
boundaries of the spectacle and hybrid sport category in the territory covered by the fifty two member
associations of UEFA.
It is important to remark that this industry is built on two main pillars, club football and national team
football, that ultimately have to “share” part of the same resources: top-level players, spectatorship,
calendar time, among others.
Dimension and Growth of the European Football Industry
There is no reliable data about the size of the European Football Industry as defined above. Deloitte &
14
Touche estimates that, in the season 2000/2001, it should be close to €10 billion. A possible
breakdown of this number is shown in Figure 1.3. We reckon that the split between club football and
15
national team football in Europe is in the range of 90-10% respectively.
Another important consideration is the fact that domestic football (in top and lower divisions) is by far
the most important segment of the industry. As we can see from Figure 1.3, the lion’s share of the
industry is represented by top-division club football in the domestic leagues, amounting to €6.6bn,
thereof the so-called ‘big-five’ leagues (England, Italy, Spain, Germany and France) dominate 78%.
Put in perspective, those numbers are not very impressive, as the entire European Football Industry
16
would not even feature in the ranking Fortune Global 500 in 2002. What is impressive though, is the
consistent fast pace with which this industry has been growing over the past 10 years. The top-division
clubs at the ‘big-five’ leagues all grew at similar rates from the mid-1990s to 2001 – between 18% to
17
24% per annum, while UEFA’s consolidated revenues grew at an impressive rate of 29% per annum
18
during the nine-year period comprised between the seasons 1992/1993 and 2001/2002 mainly
13
WESTERBEEK & SMITH, Sport Business in the Global Marketplace, Palgrave, 2003
14
Deloitte & Touche Annual Review of Football Finance – June 2002 – p.16
15
A priori, by looking at Figure 1.3, this proportion might sound counter-intuitive but we must not forget that a share of UEFA’s
and the European federations’ revenues is based on club football.
16
The Fortune Global 500 ranks the 500 largest companies in the world based on their global revenues. In the 2002 ranking,
Wal Mart appears as number 1 with global revenues around US$220 billion, while Takenaka, a Japanese company in the
construction business ranks 500 with global revenues slightly above US$10bn.
17
DELOITTE & TOUCHE Annual Review of Football Finance 2001/2000 – p.4
18
UEFA’s consolidated revenues including amounts paid beforehand – UEFA CEO Annual Report 2002 p.33
16
driven by the growth of the UEFA Champions League as we will show later. And although these
growth rates are recently giving sign of slowing the pace, we believe it is more a matter of an internal
adjustment of the industry than the apocalyptical actualisation of the burst of a bubble as many
analysts like to put it. Most of the economic fundaments supporting the growth of the European
Football Industry are solid, as notwithstanding the latest downsizing in the value of broadcast rights
paid for some properties and the breakdown of companies like ISL and KirchMedia, we do not see
signs of an actual decrease in the demand for European Football. Much on the contrary, as we have
seen that the TV audience for the 2002/03 UEFA Champions League grew by 9% in relation to the
previous year, meaning that the competition produced an average live audience of 46 million viewers
19
per match-week in the larger markets.
Figure 1.3 - Estimated market size of the European Football Industry

2000/2001 - € billion
1.3 10.0
0.2
0.7
1.2
6.6
‘Big-5’ Leagues 10 year average

England 24% growth > 20% p.a.
Italy 17%
78%
Spain 14%
Germany 13%
France 10%
Top division Lower division UEFA Annualized Revenues of Total1

domestic club domestic club Club EURO Cup2 National
football1 football3 Competitions2 Associations,
Leagues, UEFA,
others3
Sources: 1) Deloitte & Touche, 2) UEFA , 3) Authors’ estimates
It is important to notice though, that if the industry has experienced significant growth in revenues in
the last decade, profitability has not kept pace. This is mainly because of the rise in the spending on
players in a phenomenon known as the ‘prune juice’ effect, which refers to the tendency for revenues
generated by football clubs to simply pass through the clubs’ accounts on the way to players’ pockets.
Just to illustrate that point, as already mentioned, the consolidated revenues of the top-division clubs
in the ‘big-five’ leagues grew at an annual rate between 18% and 24% between the seasons 1995/96
and 2000/01. In the same period the ratio wages/revenues went from 47% to 60% in England, and
20
from 57% to 75% in Italy, just to mention two of the major markets. The result is a plunge in the
21 22
profitability of the industry in the major markets with the most accentuated cases being Italy going
23
from –1% to –19% in six seasons and Spain going from –7% to –28% in four seasons.
19
UEFA’s champion audience, Sportbusiness.com, June 3 2003
20
Analysis of the authors based on the Deloitte and Touche Review of Football Finances – 2002
21
Measured as Operating Profits / Revenues
22
The exception is Germany that managed to keep its profitability between 8% and 10% during the period
23
There are no available date for Spanish top-division clubs in the seasons 1999/00 and 2000/01
17
Business Model of the Football Industry
The current business model of the European Football Industry relies on four main revenue streams:
1. Match day revenues – Expenditure of fans on-site, mainly derived from gate receipts (including
season tickets).
2. Media rights – Value paid by media companies to acquire the rights of broadcasting a specific
sport property.
3. Sponsorship – Mainly derived from brand/name placing on team shirts and around stadia.
4. Other commercial revenues – Mainly revenues from licensed merchandise, but also includes
conference and catering services.
Figure 1.4 gives an overview on the proportions of these revenue streams for a sample of domestic
leagues.
Figure 1.4 – Breakdown of top-division clubs revenue streams – 2000/01
16% 18% 16%

25%
31% 34%
42% 40%
54% 45% 51% 12% 4%

39% 51% 20%
41% 43%
18%
13% 22% 18%
9%
30%
17% 15% 15% 20%
14% 12% 13%
England Italy Spain Germany France Portugal Netherlands Norway

(97/98)
Matchday Sponsorship (includes all commercial revenues for England)
Key:
Source: Deloitte & Touche Broadcast Other commercial
As we can see from the graph above, TV is in general the single largest contributor to clubs’ revenues
in the ‘big-five’ leagues. According to Deloitte & Touche in the season 2000/01, TV responded for €2.4
billion, or 46% of the €5.2 billion total revenues of the top-division clubs in the ‘big-five’ leagues.
However, this proportion will vary significantly according to the size of the TV market in which the club
is located. There is a clear difference between the relevance of TV monies for the top-division clubs in
the ‘big-five’ leagues and the top-division clubs in other mid-size or small leagues like Portugal,
Netherlands and Norway, as shown in the graph.
The Fan: The Heart of the Football Industry
Although the importance of television and sponsors is clear in the current business model of the
European Football Industry, which might lead us to conclude that those are the most important actors
in this industry, the dynamics of the industry rely ultimately on the interest of spectators. Figure 1.5
shows a simplified map of value relationships between actors in this industry.
18
Figure 1.5 – Summarized Value Chain of the Football Industry
Simplified
Simplified Leagues
Sponsors β
Clubs
B
C 1 3
A Football Fans
Television
Population
Note: For the sake of simplification this map does not consider some important stakeholders in the Football Industry
such as governing bodies and federations, players, clubs’ shareholders, national teams, among others
The cornerstone of value for the Football Industry is relationship j - between fans and the clubs. In
this relationship the clubs supply the fans with the game and all the emotional, social and
psychological benefits attached to it. The fans, in turn, provide the club with financial resources in the
form of gate receipts, season tickets or membership fees and purchase of licensed merchandise
besides the emotional association, support, loyalty, exposure, among other non-tangible benefits.
Relationship k illustrates the fact that clubs need the league structure to create the on-field
competition environment required by fans. And the quality of the competition, measured in the quality
of teams taking part in that competition and in the level of competitive balance, is one of the most
24
important drivers of demand for football. This relationship between clubs and leagues is one of the
well-known peculiarities of the Football Industry. In any other industry the ideal objective of the players
would be to achieve a monopolistic position driving competitors out of business, whereas in the
Football Industry this is not only impossible, but also not desirable, since clubs need to cooperate for
the joint-production of the game. However, there are inherent conflicts between teams since the
league structure also determines a team’s individual share of industry profits.
Relationship l reflects the fact that part of the football fans are not necessarily attached to one
specific club but have overall interest in a particular competition. The marketing strategy of the UEFA
Champions League has the benefit of strengthening this link eventually intending to increase the share
of the population interested for European football regardless of a particular team allegiance.
In the left side of the map we have television companies. Traditionally, revenues of free-to-air
television companies are based on advertisement from sponsors. In order to attract sponsors,
19
television companies must be able to attract audience, and this is done by offering content. That is
represented by relationship A. Television companies offer content to the public in the quest for an
audience. By getting an audience, television companies become attractive to sponsors. That is shown
in relationship C. Sponsors will pay to use television as a channel to advertise their products and
services to their target markets among the audience. Pay-TV companies have an incremental revenue
stream. In addition to advertisement from sponsors they rely on subscription fees from consumers
interested in having access to exclusive content. In both cases though, it is clear that audience is key.
In markets where the interest for a particular sport captures a large share of the population, which is
25
the case of football in the ‘big-five’ leagues, TV companies and sponsors realise the importance of
the link represented in relationships j and l and wish to exploit it. That is represented by
relationships α and β. In relationship α, TV companies pay to acquire the right (if possible exclusive) to
broadcast individual matches or competitions in the hope to attract an audience.
In relationship β sponsors pay to associate themselves with teams or leagues both as a way to get
visibility to sports fans and as a way to associate their brand with the sporting brand they are
sponsoring, thus exploring the goodwill present in the link between the fan and the sport. Their
ultimate goal is to get the population to consume their products and services.
In all cases it is simple to understand that the ultimate source of value for the Football Industry is the
interest of the fan for the sport. The fan is the TV viewer, the pay -TV subscriber, the stadium
spectator, and potentially the end consumer of the sponsors’ products and services. The larger the fan
base and the larger its identification with the sport, the higher the probability that this sport will attract
the interest of TV and sponsors. Of course, the potential value of the Football Industry in a particular
region will depend also on the size of the TV and the advertisement markets in that region, which in
the end bear relation with the demographics of the region. Thus the focal point of the Football Industry
26
is the football fan, and that is the reason why it is crucial for clubs, leagues and governing bodies to
understand what drives spectator interest for European football, in other words, what are the drivers of
demand for football.
Demand for Football Spectatorship
Stefan Szymanski summarizes the most important factors driving fan interest for football in three
27
classic elements:
- Quality of the game
- Uncertainty of outcome (of the match and of the competition)
- Success of the fan’s own team
24
Leagues or whatever entity responsible for organising a football competition
25
England, Italy, Spain, Germany and France
26
There are several studies intending to qualify the football fan according to different levels of commitment and interest. For the
sake of this paper we qualify as football fan any person interested in the game regardless of the level of commitment.
27
Interview with Stefan SZYMANSKI, Professor of Economics, Imperial College London
20
The quality of the game would touch on aspects such as the entertainment and spectacle, the
aesthetic pleasure of watching the game, the quality of the visiting team.
The uncertainty of outcome has two major aspects: uncertainty of outcome of the match and the
uncertainty of outcome of a competition. About the uncertainty of match outcome, the review of the
literature shows that generally, the closer the result of the match is expected to be, the more attractive
the game will be to fans. Along the same lines fans would be less enthusiastic about a game in which
the result is seen as a foregone conclusion. Furthermore this uncertainty must be preserved at all
28
costs, as the integrity of the game is completely connected to the integrity of the result.
The uncertainty of outcome of the competition is measured in terms of competitive balance. There is
general agreement that match attendance will be influenced by the closeness of the championship
race. As more teams have a chance of reaching the finals or play -offs, fans will expect a close contest
and anticipate high quality play. This anticipation will be reflected in a higher level of fan enjoyment
29
and consumer utility and a boost to crowd size.
Success of the fan’s own team implies that supporters achieve satisfaction from identifying with a
30
winning team. Arguably, a team that consistently loses will have difficulty attracting large crowds.
That could help to explain why clubs like Manchester United or Real Madrid have larger and more
active supporter bases than their domestic peers.
But if a winning season contributes to the increase of the commitment of the supporter base of a
specific club and if the fan base, as argued before, is the principal source of goodwill for a club, it
seems obvious to state that clubs, as individual entities, will seek to maximize their winning ratios as a
way to increase the supporter base. This practice, if successful, will eventually conflict with the
element of uncertainty of outcome.
The challenge for clubs and organisers of competitions is to understand the optimal combination
between those three elements (quality of the game, uncertainty of outcome and success of own team)
in the determination of demand for football as they frequently can conflict among themselves.
Conclusion
In summary, as much as we want to avoid the discussion of football being a business or a game, we
must recognise that the dynamics of the football industry present some specific characteristics that
make us conclude that football cannot be taken as just a regular business. These special
characteristics fall mainly in three inter-related areas:
1. Football clubs are cultural and community assets with associated sporting and community
objectives. There is a long and unfinished academic debate arguing that football clubs are utility
28
In that sense potential contractual clauses like the one suggested by the press in the Beckham transfer from Manchester
United to Real Madrid, in which the acquiring club will pay a bonus to the ceding club based on the former’s future performances
at championships at which both teams compete could allow for the public’s perception of match fixing between the two clubs in
a specific scenario, which could eventually hurt long-term demand for the game.
29
WESTERBEEK & SMITH, Sport Business in the Global Marketplace, Palgrave, 2003, p.64
30
Although formation of fan basis is a more complex phenomenon and depends on many other factors apart from a team’s
winning record at a given time.
21
maximisers pursuing non-pecuniary objectives rather than maximisation of economic value as
31
any other business. Sloan argues that while in US professional team sports, many teams have
an established track record of profitability, in the case of European football teams, profit making
clubs have been very much the exception and not the rule. He goes further explaining that
chairmen and directors with a controlling interest in football clubs are usually individuals who have
achieved success in business in other fields. Their motives for investing may include a desire for
power or prestige, or simple sporting enthusiasm: a wish to see the local club succeed on the field
of play. In many cases profit of the club seems unlikely to be the major motivating factor. As one
of our experts interviewed puts it:
‘Clubs are too much under the control of local business owners or major individuals in the
community looking for personal gain. When these people take the reigns of a club usually
they end up satisfying themselves. Many of them have come to my office and said: - For
me, investing in a club is just like having a PR campaign. Rather than giving money to an
advertising agency, I buy a club and since the press talks a lot about me, it has an
equivalent effect.’
2. The relationship between the supporter and the club can be very different to a standard customer-
32
company relationship. Lomax explains that most supporters choose their clubs at a young age
and then stick to this choice however irrational it may seem at face value. Football supporters are
key stakeholders contributing to the club not just by being loyal customers but also by actively
adding to the match day spectacle, and often committing financially to keep their club afloat as it
was the case with the English supporters of Northampton FC that contributed with money in a
fundraising campaign to alleviate the club’s financial distress.
3. As already mentioned, the Football Industry depends on both competition and co-operation
among clubs. Football then redistributes income from leading to lagging clubs (and leagues) in
order to promote competitive balance. This redistribution of income would not be allowed in most
traditional industries.
The combination of those three factors makes the dynamics of the football industry special in relation
to most of the other regular forms of businesses.
1.1.3. STAKEHOLDERS ’ MAP
After analysing the governance structure and the dynamics of the European Football Industry, it
makes sense to map its stakeholders in a more comprehensive way. Figure 1.6 depicts those
stakeholders:
31
SLOANE Peter, The economics of professional football: The football club as a utility maximiser, Scottish Journal of Political
Economy pp.121-145, June 1971
32
LOMAX Brian, Democracy and Fandom: Developing a supporters’ trust at Northampton Town FC, in: GARLAND John,
MALCOLM Dominic and ROWE Michael (Ed),The Future of Football – Challenges for the 21st century, Frank Cass, 2000
22
Figure 1.6 – Stakeholders Map of the European Football Industry
Non
Non
Exhaustive
Exhaustive Fans /
Clubs
Spectators
Municipalities
UEFA
Club
Patrons
FIFA
Stock
Market
European Football Industry Media
G-14
Sponsors
European
Union Press
Players
National
National Associations
Leagues
Once the stakeholders are identified we will make use of table 1.1 to map their interests, analyse their
bargaining power, identify the main groups over which they exercise their power and qualify the types
of pressures suffered by each group.
Some of the points covered in this section are introductory and will be explained in more details later,
but we think it is important to bear in mind the relationships described below, as they will be helpful to
understand the nature of the conflicts treated in this paper.
Table 1.1 – General overview of stakeholders interests, power and pressures
Stake- Pressure
Main Interests Power Vulnerability Pressure exerted
holder received
• Identification • Not sufficiently Immediate pressure for
• Entertainment Focal point of the organised sport performance on
Fans / • Spectacle industry but not • Too emotionally clubs and players.
Pressure on Community
Spectators • Psychological sufficiently attached to the
satisfaction organised (H/M)* game, will accept Media/Press as
poor treatment consumer.
• Social Integration
• Internal conflict Fans (H/M)
between Press (H)
individual and Players (H)
cooperative Patrons (H)
objectives Pressure on Governing
Bodies and leagues over UEFA (H)
• Increase demand for Basic cell of the • Short-term view a number of issues G-14 (H/M)
football industry, controls
• Little control over related to the regulation Media (H/M)
the most valuable
Clubs • On pitch performance main cost items of the game (Revenue
assets for the FIFA (H)
limited by budget • Not a homo- sharing, competition
production of the
constraints geneous and format, supply of players Sponsors (H)
game (H)*
organized group to national teams, Leagues (H)
calendar)
• Lacks direct Stock Market
representation at (H)
higher decision Nat. Assoc.
making level (H)
*High (H), Medium (M), Low (L)
23
Table 1.1 – General overview of stakeholders interests, power and pressures - continued
Stake- Pressure
Main Interests Power* Vulnerability Pressure exerted
holder received*
G-14 (H)
• Develop the following Other clubs
of the game in Detains the (M)
Europe natural monopoly FIFA (H)
• Keep tight control of in the organisation • Relies too much
Pressure on clubs and EU (H)
the game in Europe of the game in on elite club and
players to comply with Press (H)
UEFA Europe, holds the national team
• Promote solidarity the regulations and
key for eligibility of competition to Fans (L)
• Promote sport for all principles
players and clubs fund its activities
Media (M)
• Develop other at competitions
disciplines of the (H) Sponsors (L)
game Players (M)
Leagues (L)
• Develop the following
of the game
universally Pressure on national EU (H)
• Relies too much
• Keep a strong control associations, Media (M)
Is the supreme on one single
of the game confederations, clubs to
FIFA body of world national team Sponsors (L)
football (H) comply with the rules
• Promote solidarity event to fund its
and regulations of the Confedera-
activities
• Develop other game tions (M)
disciplines of the
game
• Limited
• Content – to get bargaining power
audience from the over the price of Fans (H)
fans Is the single major top events Pressure on leagues EU (H)
• Has an interest in the investor in the and UEFA for changes
game. Without TV • Limited concern in the format in the quest Internal
Media game as long as it about the long competition
generates audience. money Football for immediate rise in
term issues of the (H)
Will switch to other collapses (H) audience
game Sponsors (H)
content options as
soon as it does not • Subject to
competition law
It is the ‘Big Brother’
• Content – to get Extremely watching the steps of Fans (H)
Press readership from the influential over • Credibility Clubs, National Other types
fans fans (H) Associations, Leagues of media (H)
and Players
Has the control National
over the national Leagues (H)
game, is Being confined to
national borders Players (H)
National • Aligned with FIFA represented with
decision power at may suffer from Pressure on the clubs, G-14 (H)
Associa- and UEFA at the globalisation
UEFA and FIFA, and on the leagues Clubs (M)
tions domestic level tendencies
owns the national Fans (M)
teams – a major
source of passion Media (H)
(H/M) Press (H)
• Organise club
competition at the Usually controls Being confined to Pressure on the clubs
the central national borders for cooperation over the Clubs (H)
National domestic level
marketing of may suffer from quest for individual Media (H)
leagues • Commercial domestic globalisation objectives, pressure on Fans (L)
optimisation of competitions (M) tendencies national associations
domestic competition
In the top level,
due to the limited Clubs (H/M)
supply of talent • In general not too Fans (H)
• Self realisation and due to organised Pressure on the clubs
Press (H)
Players • Financial security identification of • Incredibly risky for better labour
• Status fans (H). In the and specific conditions Nat. Assoc.
lower level due to career – short (H/M)
the high Leagues (M)
replaceability (L)
24
Table 1.1 – General overview of stakeholders interests, power and pressures - continued
Stake- Pressure
Main Interests Power Vulnerability Pressure exerted
holder received
• Guarantee fair trade
in the industry
Most of the time
• Help Federations to Can change the Industry
acts like an Pressure on the
implement structure in which sectors (H)
observer, not governing bodies on
EU professional the professional
taking action until anti-competitive Member
management level of the game
an actor practices states (H)
• Keep the balance is managed (H)
complains
among football and
other industries
• Do not represent
• Increase all top clubs
representation of top • Not officially
clubs in the decision recognised by
G-14 making process of UEFA Pressure on UEFA, Fans (L),
professional club Represents the
(The • Cannot impede FIFA, national UEFA (H),
football at major top clubs in
Lobby UEFA or FIFA to associations, other clubs Member
international level Europe (H)
Group) directly deal with and the EU clubs (L)
• Advise clubs on individual
current financial member clubs
challenges • Threatening
behaviour
• Relegation /
Promotion
system
• Eligibility for
international
competitions
Important source • Too dependant

of funds for some on the highs and
Pressure on the listed Regulatory
lows of sporting
Stock • Maximisation of clubs, but not very clubs for diversification bodies (H)
performance
Market shareholder value representative in of revenues and for
the industry as a • Subject to financial returns Fans (L)
whole (M/L) regulations made
by people who
may not be profit
seekers
• Limited sensitivity
to the long term
peculiarities of
the game
• Limited control
over the
sponsorship
agreement
• Visibility to fans One of the major • Reduced Share-
Pressure on competition holders (H)
• Association with the sources of bargaining power
Sponsors organisers, clubs and
goodwill of clubs and revenue in the over the price of Other
players
competitions Industry(H) top events sponsors (H)
• Internal
competition in the
sponsorship
industry
• Prestige Too much Fans (M),
Owner and
Club emotionally Over players for pitch Players (H),
• Value transfer to benefactor of the
Patrons involved with the performance Community
other businesses club (H)
club (H)
• Prestige and Heritage Potential to
of city Often own Clubs (M)
Municipal- overextend its Legal restrictions on
facilities such as
ities • Promotion of Sport limits to satisfy facility development Fans (M)
stadia
for citizens desire for sport
25
1.1.4. PROFESSIONAL FOOTBALL COMPETITION CALENDAR
The pyramid structure of football governance, along with the international nature of the game impose
additional challenges to the organisation of competition in Europe. All layers of the pyramid rely mainly
on the organisation and participation at competitions to generate the funds for their activities. Be it
FIFA with its quadrennial World Cup or biennial Confederations’ Cup , UEFA with the Euro or the
UEFA Champions League, the National Associations with the participation in the international
competitions for national teams organised by FIFA and UEFA or with the organisation of the domestic
cups, the national leagues with the organisation of the domestic league, or the clubs participating in
domestic and international competitions, all actors depend ultimately on competition to subsist.
The complexity in the organisation of the competition calendar comes from the fact that the actors
have to share the same restricted resources: players and time. National team competitions, to be able
to exploit their full commercial potential, have to count on the presence of top players, often the same
players that are fighting for top teams in club competitions. International club competitions, along the
same lines, hope to count with the participation of the most popular clubs, the same ones participating
in domestic competitions. All of this constrained by the fact that there are only 52 weeks in the year,
and there is a physical limitation to the number of matches a player can play in a given period of time.
Thus it is not an easy task to find the right combination of supply among the different types of
competitions: the one that will maximise the utility for the football fan. Figure 1.7 shows the
configuration of the football calendar for the season 2002/2003, displaying the major competitions
currently being played at the elite level of football in Europe.
Figure 1.7 – European Competition Calendar – Elite Professional Football – Season 2002/2003
2002
June July August September October November December
4)
Week 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52
1)
Domestic League
Domestic Cup 6)
UEFA Champions League2)
ub
UEFA Cup2)
Cl
UEFA Intertoto Cup

Super Cup / Intercontinental
FIFA World Cup7 )
Euro (qualification)
Te l
na
am
tio
International Friendlies3 )
Na
2003 Season 02/03

January February March April May J Total
Week4 ) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Matchdates
Domestic League1) 38
6)
Domestic Cup 10
2)
UEFA Champions League 23
b
Clu
UEFA Cup2) 15
UEFA Intertoto Cup 10
Super Cup / Intercontinental 2
FIFA World Cup7 ) 9
Te l
Euro (qualification) 8
na
am
tio
3)
Na
International Friendlies 4
Notes: 1) Based on the English Premier League

2) Including qualifying rounds Key:
3) According to FIFA Coordinated International Calendar
4) Week 22 starts on Monday May 26t h and finishes on Sunday June 1st Weekend matches5 )
5) Weekend matches include Monday and Friday for the Domestic League
6) Based on the FA Cup – Starting at the 3r d round when Premier League clubs join the cup Mid-week matches
7) Maximum of 7 matches per national team
Source: Analysis of the authors based on data from Rec.Sport.Soc cer Statistics Foundation (RSSSF), UEFA and FIFA
26
Figure 1.7 shows that the majority of the annual football activity is based on domestic club football,
including a domestic league and a domestic cup. Although the graph is based on the Premier League
and the FA Cup, the activity in other countries follows a similar pattern. There is usually a domestic
league being played from August to May mainly during the weekends with a number of match dates
varying slightly depending on the number of participants at the top division of the league (usually
between 18 and 20 in the major markets), and there is a domestic cup usually being played during the
33
mid weeks over around 10 rounds. In the international scenario, there are three main club
competitions currently being organised by UEFA, The UEFA Champions League, The UEFA Cup and
the UEFA Intertoto Cup.
UEFA Champions League
Eligibility for the UEFA Champions League depends on the technical performance of clubs at their
domestic leagues, and on the ranking of national associations prepared by UEFA. As an example, the
champions and the runners-up at the English Premier League automatically secure a berth among the
32 participants at the UEFA Champions League, while the third and fourth places will play at a
qualifying stage. The same is valid for Spain and Italy. But countries ranked lower by UEFA receive a
reduced number of berths for the competitions with some countries receiving only a place at the
qualifying phases. The competition is preceded by three qualifying phases played by 56 clubs entering
in different stages. From the qualifying phases 16 clubs eventually gain access to the competition.
Those clubs join the other 16 that secured an automatic berth, totalling 32 clubs. Currently, the 32
clubs play a first group stage (eight groups of four teams) with the two top teams in each group
qualifying for a second group stage (four groups of four teams). The group stages are followed by a
knock out stage (quarter finals and semi finals) with home and away matches followed by a one leg
final match at a predetermined venue. For the season 2003/04 UEFA has decided to eliminate the
second group stage, meaning that the sixteen clubs qualifying from the first group stage (eight groups
of four teams) will enter directly into the knock out stage (eighth finals, quarter finals, semi finals, and
34
the final). This will reduce the maximum number of matches per club from 17 to 13.
35
UEFA Cup
Eligibility for the UEFA Cup is open to teams finishing in leading positions behind the champions in the
domestic top divisions, besides the winners of the national cup competition, the winners of the league
cup competition in certain countries, the three winners of the final matches at the UEFA Intertoto Cup
and three clubs from UEFA’s annual fair play assessment. The UEFA Cup is a knock-out competition
played home and away (except for the final match which is played in a one leg match) and is preceded
by a qualifying stage. After this stage, a group stage of forty yields twenty-four teams which proceed to
the final rounds joined by the eight teams falling in third place at the first group stage of the UEFA
Champions League. Figure 1.8 illustrates the format of the UEFA Cup, which is currently being revised
by UEFA.
33
The domestic cup usually counts on the participation of clubs from many professional divisions, but the top clubs will join the
cup at an advanced stage.
34
Not considering the qualifying rounds
27
Figure 1.8 – Format of the UEFA Cup
# of
Clubs
80
24
Teams
divided
Into 40 Top 3 32 16
8 4 2 Champion
8 groups teams
of 5 teams per group
+
8
From
UCL
Qualifying Group Stage First Round Round Quarter Semi Final

Stage of 16 Finals Finals
(includes Intertoto
Winners)
UEFA Intertoto Cup
The UEFA Intertoto Cup is UEFA’s summer competition allowing clubs that did not qualify for the
Champions League or the UEFA Cup both to play in a European competition and to fine-tune their
preparations for the winter domestic season. In its current format, 60 clubs are entitled to take part in
this knock out competition with home and away matches. The exact number of participants per
national association and the stage in which the teams will join the competition is determined by the
UEFA ranking of national associations. Associations are entitled to enter only top-division clubs that in
principle finish their domestic championship at a position immediate below those that qualify for the
UEFA Cup. The competition consists of five rounds. The 60 teams enter the competition at different
stages. Forty teams participate in the first round, with the 20 winners, together with 12 seeded teams
playing the second round. The sixteen winners of the second round together with 8 other seeds take
part in the third round. The twelve winners of the third round play in the semi-finals, and the six
winners play in the finals. The three winners grant the right to compete in the UEFA Cup first round.
In addition to those competitions there are two international match dates for clubs, as shown in Figure
1.7. The first one is the UEFA Super Cup, a match played between the winner of the UEFA
Champions League and the winner of the UEFA Cup, usually during the last week of August. The
second is the European/South American Cup, or the Intercontinental Cup, played in Tokyo between
the winner of the UEFA Champions League, and the winner of the Copa Libertadores, the continental
club championship of Conmebol, the South American Football Confederation, usually during the first
week of December.
Apart from club competitions, there are the national team competitions. Usually the continental
competitions organised by the confederations are played every four years, alternated with the FIFA
World cup, also played every four years. Both the FIFA World Cup and the Euro (continental
competition of national teams organized by UEFA) involve qualifying stages with matches being
played during the prior seasons. With the introduction of the FIFA Confederations Cup, scheduled to
35
The UEFA Cup format described here is the new approved format which will be introduced in the 2004/05 season.
28
be played biennially, there is an official national team competition being played every year, during the
month of June. In total, there are an average number of 20 match dates for national teams per
season, including friendly matches.
1.2. MODERN ISSUES
1.2.1. FOOTBALL AND GLOBALISATION
‘Compared with this summer’s continuing attempt to sell football to the

Americans (FIFA World Cup USA 94), today’s arrival of the Tour de France in
England is only a small step in the globalisation of sport. But there can be little
doubt that both are part of the same process. Sport may be the quintessence
of nationalism on many occasions, but it is also one of the most effective
means yet devised of uniting the global village.’
The Guardian, July 6 1994
The Meaning of Globalisation
Definitions of globalisation are as numerous as there are books on the topic, and this is no different
36
when we link globalisation with sport. Yet almost all the authors agree that the globalisation
processes – involving an increasing intensification of global interconnectedness – appear to be
gathering momentum and despite their unevenness, it is nowadays more difficult, sometimes
impossible, to understand local or national experiences without reference to these global flows. For
Robertson, ‘in its most general sense, globalisation refers to the process whereby the world becomes
37
a single place’, a process which involves the development of a global culture and that has been
accelerated lately by the quick development of means of communication that have made distances a
much less meaningful issue when we talk about transportation or communication. They allow a
globalised exchange between the different parts of the globe and open therefore borders and markets.
Sport, and football in particular, is at the forefront of this globalisation process. It is probably the most
universal aspect of popular culture as illustrated in table 1.2 below. It crosses languages and countries
to captivate spectators and participants, as both professional business and pastime. Governing
bodies, elite clubs, players and other major stakeholders in the football scenario must therefore
consider the global reach of the game when they make decisions or design their strategies.
36
We could cite here a few interesting works on globalisation and sport: MANGAN J.A. (Ed), Europe, Sport World. Shaping
global societies , The European Sport History Review, volume 3, Franck Cass, 2001. MAGUIRE Joseph, Global Sport, Polity
Press, 1999. MILLER Toby, LAWRENCE Geoffrey, Mc Kay Jim & ROWE David, Globalisation and Sport, SAGE Publications,
2001.
37
ROBERTSON Richard, Globalisation: social theory and global culture, SAGE Publications, 1992.
29
Table 1.2. The road to global modern sport
Period 1850-1914 1918-1980 1980-now
Commerce and
Principal objective Morality, education, values Spectacle communication
Institutional and legal Non-profit independent National and international
Commercial corporations
framework clubs and schools federations
Sophisticated sporting
Driver of progress in sport Muscles Science
equipment
Regional at first and then
Scope of competition International Global
national
Countries participating at
13 (1896) 59 (1948) 197 (1996)
the Olympic Games
Principal media Written media Radio Television
Number of cumulative 200’000 (Olympic games 33.4 billion (World Cup
-
television spectators 1936) 1998)
Number of international
20 (1912) 315 (1977) 700 (1996)
competitions
Television, corporations
Principal financing Participants Spectators and shareholders
Source: Adapted from WESTERBEEK Hans & SMITH Aaron, Sport Business in the Global Marketplace, Palgrave, 2003, p.80.
Globalising Tendencies in Sport
The globalising changes occurring in sport represent multiple, and overlapping tendencies that are
38
located at the national, regional and global levels. These tendencies include:
• increased involvement by global telecommunication oligopolies, including News Corp., Disney and
Time Warner, in the control of the scheduling and production of sporting competitions, the use of
39
sport as a marketing device, and the ownership of sports franchises;
• using the new international division of labour to produce sports equipment and sports and leisure
related apparel and shoes in super exploited Third World sweat shops;
• international sports organisations and federations such as FIFA generating enormous revenues by
selling television rights and sponsorships to trans-national Corporations;
• promoting national leagues and specific teams, recently Manchester United or the Brazilian
national football team in markets overseas as a means to promote league and team related
merchandise;
• international sports management firms, such as IMG, managing athletes, clubs and promoting
events as well as producing the televising of those competitions;
• the proliferation of foreign athletes on professional teams;
• the professionalization of former amateur sports, such as Athletics.
38
List of globalisation’s different impacts on the world of sport proposed by George Wright in: WRIGHT George, Globalisation
and Sport, Olympic Review, October/November 1999
39
As an example, Disney owns the following sports related subsidiaries: ABC Sports, ABC Sports International, ABC Sports
Video, ESPN, Eurosport (along with TF 1 and Canal+), the Anaheim Angels (Major League Baseball), and the Mighty Ducks
(National Hockey League). In addition, in September, 1998, News Corp. tendered a bid to purchase Manchester United for $1
billion, having already bought the Los Angeles Dodgers earlier in the year for $311 million.
30
Football, the ultimate stage of globalisation
40
For Pascal Boniface, ‘the sun never sets on the Empire of Football’. Larger than the former British
Empire’s influence and the current American superpower’s and clearly less contested, football’s
influence has kept growing throughout the world to reach a level that could well be the ultimate level of
globalisation.
It is true that only a few countries worldwide still resist to the expansion of the game. Football is more
widespread than democracy, internet or free market economy. It uses the most modern means of
communication to develop its already global reach even further. For instance, Zinedine Zidane or
David Beckham are doubtlessly more well-known figures than the French President Jacques Chirac or
England’s Prime Minister Tony Blair. They definitely have more appeal to many generations
throughout the globe since one can indeed have Beckham as a favourite player in spite of the
continent one lives.
Created in 1904, FIFA is a perfect symbol of the global reach acquired by the game throughout the
41
twentieth century. Thanks to its success in standardising rules, practices and control of the game
FIFA counts today more members than the United Nations, 204 vs. 190, even recognising one
member federation per country. Each member uses football as a means to promote their national
42
identity inside and outside their geographical area.
Globalisation in general can be perceived and exploited in two different manners and so can football.
On one side, it can be used as a vector for development, democracy and prosperity. On the other, it
can be perceived as an invasion of the business world, an invasion that could lead to the reign of profit
over traditional values celebrated by Sergio Cragnotti, the president of the Italian club S.S. Lazio,
‘Football is the most global business of the world in a time of globalisation and triumph of
leisure. What other good has been bought by three billion consumers?43 Not even Coca-
Cola!’’44
45
Yet for others, football should be a ‘remedy against ethnocentrism’. It should help develop people’s
attention to other parts of the world and ‘just like music or literature, it is a precious means for people
46
to familiarise themselves with other cultures and other countries’. This cleavage in the perceptions is
more vivid on the European continent than anywhere else in the world. In fact, some of the conflicts
between UEFA and the top clubs in Europe indeed have roots in the new globalised reality of the
sport, as explained by Jonathan Hill, the UEFA delegate to the European Union in Brussels:
40
BONIFACE Pascal, La terre est ronde comme un ballon, Géopolitique du football, Edition Seuil, Paris, 2000.
41
But although global, the reach of FIFA is still very strongly with national boundaries who are the essence of membership
structure of the governing body.
42
Although not members of the United Nations, Palestine, Guam or Puerto Rico are examples of geographical entities that
used football and FIFA to raise the global awareness on their particular situation and desire for independence. Tibet, Greenland
and Gibraltar would for example like to join FIFA as a first step to a much desired political independence but FIFA remains very
careful with borderline cases such as those three. MONNIER Vincent, Presentation in front of the CIES Master 2002-2003 class,
non-published.
43
This figure corresponds to the accumulated number of viewers at the World Cup 1998 in France.
44
CRAGNOTTI Sergio quoted in BONIFACE, 2000.
45
AUTHIER Christian, Foot Business, Hachette, 2001, p.73.
46
Ibid, p.74
31
‘The root of the conflicts rises from the globalisation of the game, the invisible economic
forces and the new technological forces. Globalisation increases the migration of
footballers demanding higher salaries, pressuring the clubs for finding new revenue
sources. Invisible economic sources are the heavy purse proposed in the media rights
exploitation of a breakaway league and the growing desire of shareholders for a return on
their investments in football clubs. Technology comprises all the new media exploitation
but can also be extended to things such as the ability to transmit matches across the
globe building a worldwide audience therefore leading to world tours during the off-season
47
to exploit new markets.’
In essence for Hill, football has become a victim of its own success. And in a time of an increasingly
borderless world, the traditional governance structure, the pyramid founded over a structure based on
national borders might need to be revisited.
1.2.2. FOOTBALL AND THE EUROPEAN U NION
As a consequence of the rapid development of sport, especially at the professional level, and the
important place occupied by sport in society, the provisions in the Treaty of the European Union (EU),
secondary legislation, Community policies and decisions all have an increasing impact on sport
practices and realities. While sport was not traditionally among the competences of the EU as neither
48
the Rome Treaty, the Single Act nor the Maastricht Treaty even pronounce the word ‘sport’, a real
will has been demonstrated lately by the Commissioners to build a sports policy common to the entire
Union. This trend was finalised in June 1997 at the EU Summit in Amsterdam where the Heads of
49
state agreed on a common declaration for sport.
Since then, sport has continued to grow rapidly. In economic terms, it accounts for 3% of world trade.
The social impact of sport is amply illustrated by the fact that one European in three is actively
50
involved in a sport and that there are around 545’000 sport clubs in the Community. This rapid
development, both at professional and at amateur level, increasingly involves the various Community
policies. The institutions have already been called on to intervene in some cases, the most famous
example being the European Court of Justice’s Bosman ruling.
51
Bosman is indeed the one legal case that every football player and fan knows. The judgement of the
European Court of Justice in 1995 ended the age of innocence when football blithely assumed that it
was immune from the intervention of law. Post-Bosman footballers are now free to move at the end of
their contracts. Restrictions that prevented this movement, such as a the obligation of payment of a
47
Interview with Jonathan HILL, UEFA Delegate to the European Union
48
ATANGNA Prosper, Le sport, nouvelle dimension européenne, Mémoire de DESS en Eurojournalisme, Université Robert
Schuman, Strasbourg, 2000
49
In this declaration, Heads of State and governments: (1) Emphasize ‘the social significance of sport, in particular its role in
forging identity and bringing people together, (2) call on ‘the bodies of the European Union to listen to sports associations when
important questions affecting sport are at issue, and (3) recommend that ‘special consideration should be given to the particular
character of amateur sport’
50
European Commission, The development of European Union action in the field of sport, Commission staff working papers, 29
September 1998.
51
Union Royale Belge des Sociétés de Football Association ASBL v. Bosman (Case C-415/93), 1996, All E R (EC) 189 ECJ.
32
transfer fee to the old club, even when the player was out of contract, were decreed an infringement of
a worker’s right of free movement under Article 48 of the Treaty of Rome.
For Ken Foster, Bosman was undoubtedly a great changing point for European football but, on top of
52
that, it “had a sting in its tail”. It indeed also lead the Court to consider the possibility that football was
53
operating in an anti-competitive manner contrary to article 85 and 86 of the Treaty. The final
judgement in the Bosman case was not based on these grounds but, subsequently, the European
Commission which has enforcement powers against anti-competitive practices, ordered UEFA to
comply with the judgement by using these articles. In the future, professional football would, for legal
purposes at least, be considered a business.
That response by the Commission – that European competition law would apply to football – opened a
Pandora’s box. Indeed, a literal application of that law could make most aspects of the control and
regulation of European football by UEFA subject to legal challenge, and this is exactly what happened.
A flood of complaints from all different sources and sorts reached the offices of the European
Commission, ranging from the physical relocation of clubs to the arrangements for ticket sales at the
World Cup 1998 in France. Governing bodies such as FIFA and UEFA became very alarmed by this
growing trend and have therefore begun to argue and lobby for a kind of umbrella for sports governing
bodies within European competition law, hoping to regain somehow the control of their affairs.
For the major conference on sport organised in Olympia in 1999, important discussion papers were
prepared by the Commission and four principles emerged as guidelines for future EU legal
54
interventions in the football industry:
4. The fundamental freedom for players and clubs to move and operate anywhere within the
European Union should not be limited. The only exception is when desirable ‘sporting’ objectives
cannot be reached by any other route.
5. National Identity is a key element of sport and thus sporting federations can have a legitimate
interest in preserving it. The Post-Bosman fear that national distinctions would be under threat
has then proved unfounded. Some degree of national differences can still, legally, be recognised.
6. European Competition Law applies to professional football but sport has unusual features that
means it is not always possible to treat it as any other business. Football authorities can make
decisions even if they restrict economic opportunities. However, when they do so they must
justify them in sporting terms, such as the need to encourage competitive balance.
7. Sporting federations such as UEFA are monopolies and have as such a dominant position under
55
Article 86 of the Treaty. Therefore their power can be controlled if abused. Yet sport governing
52
FOSTER Ken, European Law and Football : Who’s in charge ?, in: GARLAND John, MALCOLM Dominic and ROWE Michael
(Ed), The Future of Football. Challenges for the Twenty -First Century, Frank Cass, 2000, pp. 39-51.
53
Article 85 prohibits the restrictive agreements between enterprises including football clubs and federations. Article 86 deals
with the ‘abuse of a dominant position’. UEFA, arguably, occupies such a position as the sole governing body of professional
football in European football.
54
First European Conference on Sport 1999, Discussion papers on the European Model of Sport, European Commission DGX,
Brussels, April 1999.
33
bodies are hybrid entities. They deal with amateur as well as professional clubs, as it has been
recognised in the Amsterdam Declaration, but might have some of their activities being judged
differently because they are acting for the greater good of the game even when the economic
56
interests of professional clubs are damaged.
These guidelines leave room for great changes in the pyramidal structure of European football. Top
clubs and UEFA took some time to understand it but treat nowadays the EU as a major partner in their
work. It is no coincidence that G-14’s headquarters have been located from its very first day in
Brussels, also headquarters of the EU, and that UEFA has recently delegated one representative to
the EU. The importance of the European Commission power within the Football Industry is growing as
57
attested the recent modifications of the selling process of TV rights. Top clubs found in the EU a
potential ally in the reforming process of the European structure of football while UEFA, its global
counterpart FIFA, and other major governing bodies try to lobby the European commission to integrate
within the European Treaty a specific reference for sport that would acknowledge the peculiarities of
the sport industry and limit the possibilities of involvement of EU in the sporting world. This reference
would recognise the specificity of sport, conceding that a different approach is needed, as confirms
Lars-Christer Olsson, the Director of Marketing and Professional football at UEFA:
‘The most important thing is the recognition of sport specificity and recognition of sport
governing bodies. There should be no political intervention before dialogue. I don’t think
that sports should have general exemption from the law. But the interpretation of the law
by the politicians should be made after the dialogue. ’ 58
The Nice Declaration already made a step in this direction:
‘The European Council recognises that, with due regard for national and Community
legislation and on the basis of a democratic and transparent method of operation, it is the
task of sporting organisations to organise and promote their particular sport (…)’ 59
This appears to be a clear indication that governing bodies may by and large be left to manage and
regulate their internal affairs provided that they operate within certain basic parameters of democracy
60
and transparency.
55
UEFA, FIFA and IOC are all associations under Swiss association law, which intrinsically allow for great autonomy of
organisational structure and operations.
56
In 1999, UEFA has applied for exemption from the European Competition Law for its central marketing of the television and
sponsorship rights to the Champions’ League.
57
The European commission had UEFA reform its process for marketing its television and new media rights for the UEFA
Champions League. UEFA will continue to sell live TV rights and highlights but other rights and new media rights, will be jointly
exploited by UEFA and the clubs.
58
Interview with Lars-Christer OLSSON, Director of Professional Football and Marketing of UEFA
59
Nice Declaration, paragraph 7.
60
KINSELLA Stephen and SMITH Herbert, EU and Sport : Legal Framework and Recent Developments’, Paper presented at
Europe’s first conference on the Governance of Sport, Brussels, February 26 and 27 2001. www.governance-in-sport.com
34
2. CHAPTER TWO: THE ACTORS
The objective of this chapter is to present the main actors directly involved in the production of elite
professional football in Europe. By understanding their origins, nature, interests and motives we intend
to prepare the background for the understanding of the current controversy in European football.
2.1. UEFA AND NATIONAL ASSOCIATIONS
2.1.1. THE BIRTH OF UEFA
In the early 1950s, a number of football administrators - former Italian FA Secretary and President, Dr
Ottorino Barassi; French Federation Secretary Henri Delaunay; Belgian FA Secretary José Crahay –
pursued the idea of forming a united European block maintaining that continental authorities, rather
than just one central world-wide body, were needed to supervise and direct football’s constant growth.
These administrators held a first round of talks in Zurich in May 1952, and informal discussions in
Paris (1952) and Helsinki (1953). However, the movement in support of a body bringing together the
European national football associations gathered real pace after FIFA had approved the statutory
basis for the creation of continental football confederations at its Extraordinary Congress in Paris in
1953. Consequently in Basel on June 15, 1954 at the World Cup in Switzerland UEFA was officially
formed. The early UEFA figureheads were Ebbe Schwartz (Denmark), who became President on 22
June 1954, and Henri Delaunay, who was UEFA’s first General Secretary from the official founding
meeting until 9 November 1955, when he was succeeded by his son Pierre Delaunay (France), first on
an interim basis, and then officially from 8 June 1956 and held this position for nearly three decades.
UEFA stated this as its initial aim, “to foster and develop unity and solidarity among the European
61 62
football community” and to organise competitions at a European level. In its first sixteen years of
existence UEFA set out to organise European-level competitions for clubs and nations. UEFA also
formed expert committees (for example, the Technical Committee in 1963 and the Referees’
Committee in 1968). UEFA diversified its activities to include regular instruction courses for coaches
and referees as well as conferences for general secretaries and presidents of the national
associations. As UEFA’s finances developed with the passing years, the organisation began granting
subsidies to its member associations (to cover tournament and course organisation costs, travel
expenses, etc.). Approaching the 1970’s the television began exerting a greater influence on the
game, and more comprehensive agreements with the media and broadcasting organisations became
essential, in particular with respect to the regulation of broadcasting of football matches.
By the 1970s, football’s mass public appeal was growing, evident by the huge following of the FIFA
World Cup in Mexico. UEFA began to place emphasis on the development of young footballers and
several other important administrative decisions were made. Subsidies were paid for the first time to
61
www.uefa.com
35
clubs suffering deficits after early elimination in the European competitions in 1971. The legal bodies
(Control and Disciplinary Committee and Board of Appeal) were separated from the rest of UEFA’s
administrative machinery and guaranteed independent status in 1972 and standard regulations were
adopted for all UEFA club competitions in the same year. Though binding recommendations were
issued on the maintenance of order in stadiums in 1976 this was not enough to stop the Heysel
Stadium disaster in Belgium in 1985. From this event UEFA began to realise the importance of
stringent security requirements and provisions for all-seater stadiums and removal of standing terraces
put into place at UEFA matches. UEFA has also taken on campaigns such as Fair Play or FARE
(Football Against Racism in Europe).
2.1.2. UEFA’ S MISSION
The monopolistic nature of governing bodies

63
Europe’s first conference on the Governance of Sport, concluded that ‘the aims of sports governing
bodies are to draw up rules for the sport, to develop and promote it, to widen its popularity and to
represent the sport and those involved in it. Governing bodies will, in part, achieve this through good
governance and by ensuring that the principles of democracy, independence, fairness, solidarity and
transparency are respected.’
A closer look into the statutes of monopolistic sports governing bodies with a global reach, shows that
the objectives are very much aligned with those mentioned in the previous paragraph. Examples are
the international federations of volleyball (FIVB), rowing (FISA) and tennis (ITF). The statutes of all
those federations share the objective of fostering the development of their sport on a global scale. The
means used might be slightly different though, depending on the appeal of the sport to the media. For
the FIVB, the federation intends to ‘develop volleyball as a major world media and entertainment sport
through world class planning and organisation of competitions, marketing and promotional activities’
while FISA besides promoting and developing all forms of rowing by developing training courses and
assisting in the formation of new clubs and federations, also lists objectives such as maintaining and
promoting the ethical principles of rowing, encouraging international understanding and co-operation,
and establishing measures of development aid.
Those generic goals change more significantly in sports where more than one federation oversees the
sport internationally. Rugby and boxing are two such cases. On top of the traditional objectives of
international development and promotion, their statutes also contain specific objectives acknowledging
that they share the responsibility with other bodies. In the statutes of the World Boxing Organisation,
we find in article 1.2 particular aspects of the mission of a non-monopolistic governing body:
‘Collaborate with all Regional and Local Authorities having competence over professional
boxing practice, to consolidate and develop this sport activity in the world.’64
62
Interview with Lars-Christer OLSSON
63
Brussels 26 and 27 February 2001. www governance-in-sport.com.
64
World Boxing Organisation statutes, Article 1.2, www.wbo-int.com
36
Having several governing bodies sharing the control of one sport hinders the development of the
sport, as explained by Peter Gilliéron, the General Secretary of the Swiss FA:
‘A monopolistic sport governing body is crucial. It is the only means to have an organised
game with universal standard rules, disciplinary measures and optimal utilisation of
infrastructures. Although there is always potential for a revolution of sorts and for
alternative governing bodies to ascend, if such a revolution occurs it is likely that in the
end, the whole system will revert to a new monopolistic governance structure, because
this is the most efficient way to govern the sport.
There must be only one European Champion and only one World Champion. If there are
multiple organisations governing the sport, the public becomes confused. This creates a
rift in the supporter base because of the lack of a clear message. Such situation also
undermines the long term interest of the media and sponsors. If in the short-term media
and sponsors would be able to choose between different leagues of competitions lowering
the cost of rights, in the long run, the fragmented nature of the sport would not bring
sufficient levels of audiences to generate real commercial interests in the game. This
65
would represent the death of the sport.’
UEFA’s role
66
‘UEFA is an organisation that sells spectacle and pleasure’
The quotation above seems to indicate that UEFA has changed greatly from its initial identity as an
organisation meant to foster and develop unity and solidarity among the European football community.
In some ways today’s UEFA could not be more different than the organisation created in 1954.
67
More specifically, UEFA currently defines as its goals to:
§ organise successful competitions for professional, youth, women’s and amateur football;
§ increase access and participation, without discrimination on grounds of gender, religion or

race, and support growth in the grassroots of the game;
§ achieve commercial success and sound finances without distorting the sporting qualities of the
competitions;
§ use UEFA’s revenues to support reinvestment and redistribution in the game;
§ target specific aid and assistance to help member associations with the greatest need;
§ promote positive sporting values, including fair-play and anti-racism, as well as safe and
secure match environments;
§ act as representative voice for the European football family;
§ ensure a coherent approach to decision-makers and opinion-formers on issues of relevance to

European football;
65
Interview with Peter GILLIÉRON, General Secretary of the Swiss Football Association
66
Jean-Paul TURRIAN, UEFA Director of Services. Quote from CIES visit to UEFA on 05/05/03, “L’UEFA est une entreprise
qui vend du spectacle et du plaisir”.
67
UEFA CEO annual report 2002, XXVII Ordinary Congress, Rome
37
§ maintain good relations with the other continental football confederations and FIFA;
§ ensure that the needs of those playing the game and the interests of fans are properly
reflected in UEFA’s thinking.
Re-examining the list above we find keywords that reflect the new reality of governing sport in the
commercialised world. Words like commercial success, sound finances, revenues, that would certainly
not be found in the list of initial objectives released by UEFA by its creation in 1954. But in today’s
reality, the task of promotion and development of the game requires a whole new dimension of
resources investment.
However, if we manage to look through the complex marketing strategies and pages of sponsorship
contracts making up the current reality, we will find out that UEFA maintains at its core the same
original mission. Aligned with the goals of most monopolistic sports governing bodies, the core mission
of UEFA has indeed remained to safeguard the development of European football at every level of the
game and to promote the principles of unity and solidarity. UEFA is the ‘guardian’ of football in
Europe, protecting and nurturing the well-being of the sport at all levels, from the elite and its stars to
the millions who play the game as a hobby.
But people within and outside UEFA have different views on what the main interests defended by the
continental organisation are. For Jonathan Hill, the UEFA delegate to the European Union in Brussels,
UEFA’s goal is ‘certainly to safeguard the development of the game’ but also ‘to assure the future of
European football as a whole through an effective exploitation of media rights in a time where there
68
are strong commercial pressures on the game.’ With an approach closely intertwined with these
pressures, Michele Centenaro, UEFA Senior Manager for Club Competitions, thinks that one key
mission of UEFA nowadays is to avoid deformations of the whole organisation by external forces
69
intending to denature UEFA’s role in the current structure of European football.
However, representatives of clubs consider UEFA’s mission differently. Geneviève Berti, the
Communication Manager of G-14, proposes a very rigid and reductive definition of UEFA’s role as a
70
‘guardian of the text, of the spirit and of the discipline of European football.’ For Freddy Rumo, the
President of Neuchâtel Xamax FC Executive Board, former President of the Swiss FA and former
Vice-President of UEFA, UEFA’s objective should be ‘to represent the interests of the national
71
associations which the organisation is built on’.
The divergence, whether legitimate or not, in the views about UEFA’s role within the Football Family
gives us a hint on the first roots of conflicts.
68
Interview with Jonathan HILL
69
Interview with Michele CENTENARO, Senior Manager of UEFA Club Competitions
70
Interview with Geneviève BERTI, Communication Manager of G-14. For Berti, ‘UEFA have three major roles. 1-“Guardian of
the Text” They have the power of the word of football and how it is organised, structured, administered. 2-“Guardian of the
Spirit” They are concerned with the spirit of the game and its preservation. 3-“Guardian of the Discipline” They are the
“arbitrator” of the disciplinary matters regarding the sport. They also hold a “co-organiser” power in the running of the sport
because of their global perspective. Consistent with international football, UEFA has the responsibility of the social dimension
of football and its development.’
71
Interview with Freddy RUMO, President of the Executive Board of Neuchâtel Xamax FC.
38
2.1.3. UEFA’ S O RGANISATION
UEFA’s Legal Form
72
UEFA is an association under the terms of the Swiss Civil Code, formed by national football
associations situated in the continent of Europe. In order to be a member of UEFA, national
associations have to comply with the statutes, regulations of UEFA and the decisions made under
73
them and have to include such obligations in their own statutes. In fact, UEFA’s statutes also enforce
the maintenance of the pyramid structure at the national level by stating that ‘leagues or any other
groups of clubs at association level shall only be permitted with the associations’ express consent and
74
shall be subordinate to it’.
As an association under Swiss Law, UEFA is formed by a Congress, an Executive Committee, The
Chief Executive, and the Organs for Administration of Justice.
The Congress is the supreme controlling organ of UEFA with meetings held annually over matters
such as election of the president of UEFA, election of the members of the Executive Committee,
amendment of the statutes, considerations of membership applications and the exclusion of member
associations, among others. The congress is formed by representatives of all national associations
members of UEFA, with decisions being made by voting, where each member has one vote.
The Executive Committee (ExCo) is consisted of the President and thirteen other members in terms of
four years. The President of the ExCo proposes and the ExCo elects among its members, four vice
presidents and one honorary treasurer. The ExCo has the residual power and has among its duties,
the definition of the organisational structure, appointment and recall of the Chief Executive, approval of
the annual business plan, among others. The President of the ExCo represents UEFA, chairs the
congress and meetings of the ExCo. Decisions at the ExCo level are also made by voting and the
President has the casting vote in the event of a tie.
The Chief Executive is the highest operational management organ appointed by the ExCo, and the
Chief Executive Officer (CEO) is a professional employed by UEFA. Among his/her duties are the
representation of UEFA as delegated by the UEFA President, arrangement and management of the
administration and submission of an annual business plan.
The Organs for Administration of Justice are the Control and Disciplinary Body, the Appeals Body and
the Disciplinary Inspector. The members of these bodies are elected by the Executive Committee.
Additionally, UEFA’s structure counts on the Administration, Standing Committees, Expert Panels and
Ad-Hoc Working Groups. There are 11 Standing Committees, each with eleven members. Members of
the Committees are elected by the ExCo based on proposals submitted by the CEO. The Committees
72
Art. 60 et seq. of the Swiss Civil Code.
73
UEFA Statutes, article 7 paragraph 3.
39
advise the CEO, who may delegate some of his duties to a Committee. The Expert Panels and
Working Groups are appointed, if necessary, by the CEO for special duties. Currently there are 29
Expert Panels in areas such as media, marketing, TV and new technologies, doping control, artificial
turf, licensed agents, among others. A summary of UEFA’s structure is shown on Figure 2.1 below.
Figure 2.1 – UEFA’s Structure
Formed by the 52 Member

Congress
Congress Associations and chaired
by the President of UEFA
Formed by the President

and 13 members elected by
ExCo
the Congress for terms of
four years
Administration
Administration
Chief Executive
Executive of
of Justice
•Control and Disciplinary Body
•Appeals Body
Expert Panels
Panels •Disciplinary Inspector
Committees
Committees Administration
Administration and
and Working
Working
Groups
Groups
•National Teams Permanent professional Appointed by the CEO for
•Club Competitions management structure. special duties
•Assistance Programmes For further details see
•Professional Football figure 2.3
•Youth and Amateur Football
•Women’s Football
•Futsal
•Technical Development
•Referees
•Stadium and Security
•Medical
UEFA’s Professional Administration
From volunteers working to promote and organise European football competitions, UEFA has taken on
a new identity to cope with football’s new reality. Figure 2.2 shows that from 1991 onwards, UEFA’s
administration structure experienced dramatic growth of 17% annually in terms of staff. These are the
years that coincide with the rise of the UEFA Champions League, UEFA’s most prestigious club
championship.
Figure 2.2 – Evolution of UEFA’s staff – 1964 -2002
180
150
120 91-’02
17%p.a.
90
60
‘64-’91
30 6%p.a.
0
64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 '00 '02
Source: Jean-Paul Turrian’s presentation to the CIES students, May 5th 2003
74
UEFA Statutes, article 7, paragraph 8
40
This growth is also the result of the effects, particularly from a legal point of view, of a Europe without
legal borders. The growth of the value of TV rights and the rise of more sophisticated and aggressive
marketing techniques applied to sport and conventional business seeping into football were all parts of
the changing climate. Clubs were going to the stock market, the European Union and the European
Commission were increasing their involvement in sports. UEFA was having to deal with all of these
key issues while ensuring that football’s basic values were maintained and consolidated.
Consequently, during 1999 and 2000, UEFA underwent a wide-ranging restructuring programme in
which they commissioned a management consulting group to undertake an extensive audit of the
organisation, in a project called Project FORCE – Football Organisation Redesign for the Next Century
in Europe. The project included review of the business processes performed by UEFA, besides more
than 100 interviews with club presidents, coaches, former players, politicians, media and marketing
experts, other sports officials and UEFA committee members and staff. After several months, the
Executive Committee decided to implement the recommendations proposed by the Project FORCE,
leading to a major overhaul of UEFA’s organisation. Corporate divisions with directors reporting to a
CEO replaced the old bureaucratic structure. Figure 2.3 presents the new Administrative structure.
Figure 2.3 – UEFA’s Administrative Structure75
Chief
ChiefExecutive
Executive(CEO)
(CEO)
Lars-Christer
Lars-ChristerOlsson
Olsson
• CEO Office
Deputy
DeputyChief
ChiefExecutive
Executive
Markus
MarkusStuder
Studer
Communications
Communications and and •Oversees Legal, Finance
Public
Public Affairs
Affairs and Services Departments
William Gaillard
William Gaillard
• Media Services
• Publications Legal
Legal Services
Services andand
• Political relations Assistance
AssistanceProgrammes
Programmes
Gianni Infantino
Gianni Infantino
Finances
Finances
Hanspeter • Legal Servicesand National
HanspeterJenni
Jenni
Associations
• Football Accounting • Commercial Legal Services
• Company Accounting • Disciplinary Services
• Treasury • Assistance Programmes
Professional
ProfessionalFootball
Football&&Marketing
Marketing Competitions
CompetitionsOperations
Operations Football
Football Development
Development Services
Services
Giorgio
GiorgioMarchetti
Marchetti Jacob
JacobErel
Erel Andy
AndyRoxburgh
Roxburgh Jean-Paul
Jean-PaulTurrian
Turrian
• Product Management National • Competition Administration • Product Management Women’s • Information Technology
Team Competition • Event Management Football and Futsal • Human Resources
• Product Management Club • Stadium and Security • Product Management Youth and • Translations
Competitions Amateur Football • Travel and Conferences
• Professional Football and • Technical Education • Logistics
League Services • Medical Matters
• Product Management Marketing • Grassroots Development
• Marketing Operations Centre
Source: Jean -Paul TURRIAN’s presentation to CIES, May 2003 (with updated information)
2.1.4. THE R ELATIONSHIP WITH NATIONAL ASSOCIATIONS
By looking at the statutes of UEFA, we realise that the Governing Body is indeed nothing else than the
embodiment of the 52 national associations of football from the European continent. The objective of
75
This chart reflects the recent changes coming into effect at the end of 2003 within UEFA with the retiring of Gerhard Aigner,
the CEO and the departure of Director of Communications, Mike Lee. This also shows the creation of the Deputy Chief
Executive position filled by previous Legal Services Director, Markus Studer and the other internal replacements.
41
the continental federation is therefore closely linked with its members’ interests as Article 2 of the
UEFA statutes testifies when describing the objectives of the confederation. Those shall be among
others ‘to safeguard the overall interests of member associations, to respect the interests of member
associations, to settle disputes between them and to promote unity among them in matters relating to
76
European and world football.’
This statutory organisation is quite close to the actual functioning of the continental federation. The
objectives of UEFA and national associations are very much aligned around one simple goal: promote
the game of football in all its forms. Of course, the scale and scope differs and the means even more,
77
but the 52 national associations are in a way ‘well represented and heard at the European level’,
avoiding therefore conflicts between UEFA and its members. Lars-Christer Olsson, although
acknowledging that it has not always been like this, agrees that the conflicts between national
associations and UEFA are minor:
‘In the past there were some subgroups of national associations in specific areas. But they
have been split up. Today there is no national association trying to abuse the decisions
made at the Congress. Those decisions are based on a regular majority and the national
associations always follow them.’78
This is supported by Freddy Rumo. The former vice-president of UEFA affirmed also that since UEFA
is the conglomerate of national associations, decisions made are grounded on solidarity purposes.
2.1.5. SOLIDARITY - “W E CARE ABOUT FOOTBALL”
In line with its democratic structure, UEFA has in place a solidarity programme which has been
expanded by the growth in the TV rights of its competitions. Though rising pressures from clubs have
seen the amounts reassigned, UEFA still tries to maintain distribution of funds from its top
competitions, the UEFA Champions League and the Euro. This principle of solidarity allows for
revenues generated by the premier level competitions to be redistributed benefiting football as a whole
and not just a selected few. In this way, UEFA can help fund footballing activities which on their own
could not at the current time, generate significant commercial income to break even, such as youth
competitions, women’s, amateur football, futsal, coaching educational programmes, the less-
79
developed professional leagues in smaller European countries and even refereeing.
Beyond Solidarity
UEFA aims to embody the initial objectives back from its foundation while becoming a “proactive,
80
dynamic organisation with service-orientated leadership”. It attempts to maintain a corporate-like
efficiency required by a large international organisation, while still serving the greater family of football
through solidarity and charitable activities. Aside from the hours of elite football competitions
organised by the Competitions Division, the Assistance and Development Department (ADD) of UEFA
76
UEFA statutes, article 2.
77
Interview with Peter GILLIÉRON - Gilliéron added that goals are easier to align f or a federation like the Swiss one where there
is much less pressure coming from the biggest clubs on the continent.
78
79
UEFA Brochure- UEFA Champions League: A Solidarity System for European Football
42
81
creates many activities with more socially oriented aims. These include the EEAB (Eastern European
Assistance Bureau), the Meridian Project, the UEFA Charity Portfolio (Special Olympics, Open Fun
82
Football Schools in Denmark, FARE, ICRC) and the Kiosk Project.
Solidarity and the different stakeholders of European football

Undoubtedly UEFA conducts many programs intended to redistribute revenues to the whole pyramid.
Yet, although decisions made at UEFA regarding the employment of funds are justified on the grounds
of solidarity within the football family, the validity of such decisions remains controversial for some of
the stakeholders of European football. For Thomas Kurth, General Manager of G-14, UEFA should
better justify and communicate their decisions about revenue distribution:
‘The clubs believe that it is not fair that UEFA distributes the money from club competitions
as if it had been UEFA’s own merit. In fact, it has been to a large extent the merit of the
clubs. And when UEFA appears paying money to charitable projects, for instance, most of
this money actually comes from the clubs. And it should be more clearly stated that this is
money which has been raised by club football. The clubs are just the ones that are always
excluded when it is about giving merits, when it is about giving recognition.’83
Kurth is not alone in criticizing the way UEFA organises solidarity. Some of the experts interviewed for
this paper also question the effectiveness and efficiency with which this money is being invested at the
bottom of the pyramid.
84
UEFA’ S FINANCES
Most Governing Bodies rely on the organisation of elite competitions to structure and finance their
activities, and UEFA is no different. UEFA’s revenues come basically from two main sources: the
organisation of the UEFA Champions League (UCL), and the Euro – the competition of European
85
national teams. Lars-Christer Olsson estimates that for the next season (2003/04) the Governing
Body’s revenues will be split on a 50/50 basis between the UCL and the Euro 2004, each one
86
contributing with roughly CHF 1.1 billion. Considering that the Euro is organised every four years, in
ballpark figures the split between the contribution of the UCL and the Euro on an annual basis would
be around 80/20 respectively.
A closer look in the way UEFA treats its finances shows that the vast majority of those revenues never
make it to the governing body’s accounts. They are actually paid beforehand to a number of
beneficiaries directly or indirectly involved in those competitions (namely clubs, leagues, national
associations and organisers). Thus, while the revenues produced by UEFA competitions can reach the
ranks of billions of Swiss Francs from TV rights and sponsorship, UEFA’s actual revenues are closer
80
UEFA website. Administration section.
81
UEFA’s assistance programmes “Giving back to football” version 2, November 2002.
82
UEFA website. Assistance and Development section. A detailed description of these different programs can be found in
appendix b.
83
Interview with Thomas KURTH, General Manager of G-14
84
All numbers presented in this section are in Swiss Francs (CHF), the official currency used at UEFA’s financial reports. The
parity of the CHF against the Euro has been kept relatively stable along the last years at around €1,00 : CHF1.50
85
86
The other football competitions organised by UEFA are not in a commercial level sufficient to generate significant revenues.
43
to one-tenth of that, precisely CHF122 million (~ € 80m) in the season 2001/02. It is with those
revenues that UEFA covers the cost of its administration and makes direct investments in the
development of European football.
Figure 2.4 portrays UEFA’s financial reality for the 4-year cycle from 98/99 to 01/02 seasons. The
chart shows the accumulated revenues produced by UEFA’s championships, including Euro 2000, the
amounts paid beforehand to competing teams, and the share kept by UEFA to run its activities.
As depicted in Figure 2.4, 83% of the consolidated income was derived from the UEFA Champions
League, representing CHF 3.3 billion. Thereof, CHF 2.7 billion were paid beforehand. It is clear from
the chart that the clubs received the largest share of those payments (91%).
Euro 2000 accounted for 9% of the total income, representing CHF 345 million. Thereof CHF 284
87
million were shared by the 16 participating national teams (~40%), the organisers (~30%), and the
Euro Pool (~30%) to be distributed lately to all member associations of UEFA. The organisation costs
of competitions represented CHF 393 million, roughly 10% of the competitions’ revenues. Finally, CHF
88
92 million were paid as bonus to participant teams and organisers of other UEFA competitions.
Figure 2.4 – UEFA Consolidated Income Statement 1998/1999 – 2001/2002 – CHF m
3 960 3 450
To Leagues
254 and Member
Associations
(9%)
83% 2 427
From To Clubs
UCL UCL (91%)
2 681
3 287
To teams (~40%)
From To organizers (~30%)
Euro 284
To Euro Pool (~30%)
393 Organization
Euro Costs
Other 510 238
345 9%
Competitions 92 6% 272
Other 13%
8% 7%
328
Total Income Paid UEFA UEFA Assignment
beforehand retained expenses to provisions
Income and profit
Source: UEFA Financial Reports
Playing a key role in the European Football Industry, UEFA is no different from the other actors with
regards to its growth pace. As shown in Figure 2.5 the consolidated income of the competitions under
UEFA’s control have grown at an impressive 29% per annum since 1992.
87
The Euro 2000 was organised conjointly by the Belgian and Dutch National Associations
88
Namely UEFA Cup Finals, UEFA Intertoto Cup, Final round of the U-21 competition. Approximately 85% of this amount was
paid as bonus to football clubs taking part at the UEFA Cup Finals and the UEFA Intertoto Cup.
44
Figure 2.5 – Evolution of UEFA’s Revenues – CHF m
CHF m
1400
1300
UCL expanded
1200 to 32 clubs
+ Euro 2000 Consolidated
29%1
1100 income
1000 Paid
34%1 beforehand
900 UCL
Euro ‘96 UCL
800 expanded
to 24 clubs
700
UCL
600 expanded to
16 clubs
500 Euro ‘92 Paid
Creation beforehand
400 of the UCL Euro
31%2
300
UEFA’s
200 retained
12%1 income3
100
Other
0 competitions
90
91
te
/94
/96
/98
/00
/01
/02
/93
/95
/97
/99
19
19
/7M
93
95
97
99
00
01
92
94
96
98
19
19
19
19
20
20
19
19
19
19
92
19
Note: 1) Compounded Annual Growth Rate – 92/93 - 01/02, 2)Annualized growth rate between Euro’92 and Euro 2000, 3) Notice that the
growth of UEFA’s retained income is close to zero from 95/96 to 01/02
Source: UEFA – CEO Annual Report 2002
It is interesting to note that while the income generated by UEFA’s two main competitions has grown
rapidly during the period, UEFA’s retained income has remained relatively stable since 1996, being
kept at levels around CHF 120 million annually. This actually means that the incremental revenue
generated by the competitions during that period is being directed basically to the clubs participating in
89
those competitions in the form of beforehand payments. This makes us wonder if UEFA is not
actually gradually softening its direct grip on the game.
But even though UEFA’s retained income has been kept relatively stable during the last years, the
same behaviour is not observed in its expenses, as shown in Figure 2.6.
Although UEFA’s expenses seem dwarfed by the total level of income generated by its competitions,
we would like to stress that the funds available for solidarity and development of European Football
90
are the difference between UEFA’s retained income and its expenses. The conclusion is logical: if
UEFA’s retained income is being kept constant while expenses are growing, then the funds for
solidarity and development ought to be declining. In fact, a closer look at UEFA financial reports show
that those funds have gone from CHF 83 million in 1999/00 to CHF 67 million in 2000/01, ending up
at CHF 49 million in 2001/02. A reduction of 23% per annum in the last three seasons. Even if we
combine those numbers with the payments made beforehand from the UCL to the Leagues and
89
According to UEFA Financial Reports, the clubs are the main beneficiaries of the increment in the beforehand payments.
45
National Associations, which can be seen as solidarity, we verify a decline in the total amount that was
supposed to be destined to Football development during the last three seasons.
Figure 2.6 – Evolution of UEFA’s Expenses – CHF m
CHF m
80
72
Committees /
70 9%
CAGR1 Events
14% 61
60 6%
56
10% 34% Football
49 Expenses 2
50
11% 37%
43
40 14% 40%
41%
30 36% Staff / Admin
38% costs3
42%
20 33%
31%
34% PR /
10 8% Communications
7%
6% 7% 8%
11% 10%
10% 10% 7% Others4
0
97/98 98/99 99/00 00/01 01/02
Note: 1) CAGR – Compounded Annual Growth Rate, 2) Youth Football, Referees, Delegates, and others 3)Includes costs of UEFA
building – Nyon 4) Acquisitions and project amortizations, non-football expenses, extraordinary expenditure
If the trend of decrease in the use of club football money for solidarity and development continues and
if Olsson’s estimation about the growth in the values for the Euro 2004 are confirmed, UEFA might no
longer need the revenues from the UCL to fund its activities. A larger share of the quadrennial
competition of national teams would do it.
2.1.6. UEFA’S LATEST D EVELOPMENTS
UEFA underwent many changes in the last few years, facing growing pressures from clubs, the
deregulation of the transfer market and the explosion of TV revenues. UEFA had to adapt its structure
to the new challenges posed to a continental federation and its many stakeholders. We have already
addressed earlier in this section the wide-ranging restructuring programme - Project FORCE - that
changed completely UEFA’s organisational model. According to an article published at the uefa.com
News, one of the Governing Body’s official communication vehicles, one key element that emerged
from the FORCE Programme was the recognition that the clubs and professional leagues should be
given greater representation within UEFA’s activities. The article continues stating that UEFA is
pursuing an intensification of dialogue with the top clubs and leagues, while maintaining its long-
91
standing bond with the national associations.
90
Although it is clear that the revenue distributed beforehand to National Associations and Leagues might also be used for the
local development of the game, UEFA has no direct control on the way that money will be used.
91
2000-2002 : Project FORCE, Sunday, 4 August 2002, uefa.com News
46
We will now take a look at some latest developments of UEFA’s activities that appeared as a result of
the changes initiated by that project, with the aim of enhancing the relationship with leagues and
clubs.
UEFA Professional Football Committee (UPFC)
The UPFC was created with the objective of promoting friendly cooperation between the national
leagues and UEFA within the framework of UEFA’s statutes. It meets two to three times a year and by
being one of the eleven Committees of UEFA, like all other committees, it is composed by eleven
92
members, being one chairman, two vice-chairmen and eight members. From the eleven members,
one vice-chairman and four other members are appointed by the European professional football
leagues. The UPFC is administrated jointly by two professionals from UEFA’s staff: The Director of
Professional Football and Marketing and the Senior Manager of Professional Football and League
Services.
The Committee, as explained before, has an advisory function to the CEO informing him of the
viewpoints and experiences of the leagues represented. Thus, the members of the UPFC in their
capacity of representing their leagues and clubs, are responsible for presenting solutions and
proposals for the CEO in areas such as contractual relationships between clubs and players,
principles for compensation for training / education of players, impact of new formats of European club
competitions for domestic competitions, club licensing system, release of players for national teams,
solidarity system among others.
UEFA Statutes (art. 37 par. 3), allow the CEO to delegate some of his duties to Committees, thereby
transferring decision-making powers. By delegation of the CEO, the UPFC has the power to decide on
the principles to be observed by the leagues in making use of the UCL revenues allocated to them for
the training of young players, according to the competition regulations.
The UEFA Club Competitions Committee (UCCC)
The UCCC was created with the main objective of exchanging views on current UEFA club
competitions and their formats, and coordination with national team, FIFA and IOC events. The
Committee meets four times a year. Following the pattern of the other Committees, the UCCC has
eleven members, thereof, seven are appointed by UEFA, and four are representatives of clubs,
coming from the European Club Forum.
92
The UPFC has an additional co-opted member, besides the regular 11 members.
47
European Club Forum
In February of 2002 UEFA hosted a workshop for clubs dealing with issues such as marketing rights
93 th 94
and competition structure. On July 9 2002, UEFA introduced the European Club Forum (ECF).
This body is designed to strengthen the links between UEFA and top clubs in Europe. Within UEFA
statutes, the ECF is an Expert Panel that supports the Club Competitions Committee in all its tasks.
The ECF has met at UEFA’s headquarters addressing issues such as the UEFA Champions League’s
95
commercial rights, national team issues, team-jersey sponsoring and artificial turf.
The ECF is composed by representatives of 102 clubs from throughout the continent. The
membership structure has been defined by making use of UEFA’s ranking of National Associations.
Thus, as an example, Spain, Italy and England have the right to appoint five members, Germany,
France and Holland can appoint four, and so forth.
The 102 clubs are represented themselves by the ECF Board consisting of eleven clubs. The current
members of the board are Real Madrid (Spain), Lazio (Italy), Manchester United (England), Bayern
München (Germany), Olympique Lyonnais (France), Galatasaray (Turkey), FC Porto (Portugal),
Dynamo Kyiv (Ukraine), Glasgow Rangers (Scotland), Dinamo Zagreb (Croatia) and Litex Lovech
(Bulgaria).
Figure 2.7 depicts the structure of the European Club Forum and its relationship with the Club
Competitions Committee.
Figure 2.7 – Structure of the European Club Forum
European Club Club Forum Club Competition

Forum Board Committee (CCC)
Members
(102) UCL Holder Chairman 1 Member
Vice-
1 Member
Chairman
Associations The Board Vice-
ranked elects the 1 Member
1 to 6: 4 members Chairman
chairman and
27 clubs three vice- Vice-
chairmen
1 Member
Chairman
The chairman
and the vice-
chairmen sit
Associations on the Club
Competitions
ranked 7 to 15:
Commission
27 clubs 3 members
7 members
Associations (nominated
ranked 16 to 26: by UEFA)
22 clubs 2 members
Associations
ranked 27 to 52: 1 member
26 clubs
Source: www.UEFA.com
93
UEFA Press Release No. 13 - 2002
94
48
96
It is worthwhile mentioning that all members of G-14 with the exception of Paris Saint-Germain and
Olympique de Marseille are current members of the ECF, and among them, five G-14 clubs are
members of the ECF Board. However, being an Experts Panel, the body has no direct link with the
Executive Committee of UEFA, and it is only an advisory body with no decision making power.
UEFA Licensing system
Acknowledging that European clubs have gone through a great deal of changes lately, undergoing
financial challenges arising from dramatic cost pressures and that the wealth has become much more
concentrated in a few markets, UEFA developed recently a concept of club licensing to meet its duty
to shape a framework for the future of the game. Started in 1999, the process to create this framework
has become a reality and should be in place for the 2004/05 season.
97
Officially, the aims of this licensing program for clubs are:
§ promoting and improving sporting standards in European football;
§ increasing the focus on the training and care of young players in each club;
§ strengthening the economic and financial health of clubs, increasing their transparency and
credibility, and placing the necessary importance on the protection of creditors;
§ adapting sporting infrastructures to future requirements so that spectators and the media can
visit well-appointed, well-equipped and safe stadia;
§ improving the quality of the administration in club football; and providing the necessary help,
support and education to the national associations, leagues and clubs operating the licensing
system.
To reach those goals UEFA drew a set of criteria that will determine if a club is qualified to be granted
a licence to participate in official competitions. Those criteria fall into five categories: Sporting,
Infrastructure, Personnel & administrative, Legal and Financial. For each of those categories there will
be different types of criteria: some must be fulfilled as defined, some can be fulfilled with possible
alternatives and some are “nice to have” best practices recommendations. The licensors will be the
national associations who may delegate this power to an affiliated league although remaining fully
responsible vis-à-vis UEFA for the licensing project as such.
This grand reform of European football raised some concerns among the clubs and also at the
European commission. Is this licensing system a means to slowly close access to elite competition
with many clubs unable to meet the criteria imposed by the system? For Arnaud Rouger, the legal
adviser of the French professional league, one cannot exclude this possibility:
‘I am concerned that this could lead to higher criteria which fewer clubs could satisfy and
then you approach a closed league of sorts. From the Club system to a closed league,
there is a long way to go however.’ 98
95
96
The members of G-14 are presented in section 2.4 of this paper.
49
Aware of this concern among certain stakeholders, UEFA has asserted that ‘there is no desire to
exclude clubs from European competitions but rather to create a framework to encourage and facilitate
better financial planning, greater transparency, improved infrastructure and a real commitment to
youth development. The UEFA club licensing system itself will be improved on a continuous basis in
99
collaboration with the national associations, leagues and clubs.’
In practice, UEFA is assuming the role of a regulator, typical in natural monopoly industries that have
undergone a process of privatisation, like utilities such as electricity distribution, gas, and water for
instance. In such industries, the regulator has to make sure that the concessionary will perform a wide
range of services to the entire population covered by the concession area, and it does so by
establishing a set of performance measures for service level. Without such measures the
concessionary, being a profit maximiser, will focus on the profitable areas, and if possible, drop the
service in areas that offer less potential for financial returns. By implementing the Club Licensing
System, UEFA intends to make sure that all clubs will observe a set of practices that it considers
crucial for the long term survival of the sport, such as investment in youth development programmes,
maintenance and security of stadiums, a sound financial situation, among others, even if those
practices might mean the forfeiting of short term profits.
Dialogue with the European Union

In the spring of 2003, Jonathan Hill, the new UEFA delegate to the European Union began working in
Brussels. The discrete opening of an office in the Belgian capital by the European sports governing
body shows how UEFA has come to change its attitude toward the European Union in recent years.
Not prepared for the revolution created by the Bosman judgement and again not fully aware of the
risks to submit its monopolistic selling process of broadcasting rights to the European Commission,
UEFA has learned its lesson and considers now the European Union as a major partner in the future
shaping of European football, as confirmed by Jonathan Hill:
‘In the past UEFA has been at times arrogant, but as the opening of the new Brussels
office shows, UEFA is showing a positive agenda. They have a desire to build a
relationship with the EU. Though still characterized as “react and respond”, UEFA has
realised that it has to step forward as it faces and copes with the major commercial
pressures’.100
The main efforts of UEFA should now be in collaboration with other sports governing bodies such as
FIFA or the IOC to try to obtain the recognition of the specificity of sport by the European Union, a
recognition that should avoid the European Commission constantly revising practices of the governing
bodies taken for the good of the sport, but from a monopolistic situation.
97
UEFA’s Communication and Public Affairs’ Division, Creating a better future. Club licensing for European football, March
2003, p.2.
98
Interview with Arnaud ROUGER, Legal advisor for French Professional League
99
UEFA’s Communication and Public Affairs’ Division, Creating a better future. Club licensing for European football, March
2003, p. 22.
100
Interview with Jonathan HILL
50
2.2. NATIONAL LEAGUES
A peculiar characteristic of team sports, and football is not the exception, is the existence of leagues
grouping teams or clubs participating in a particular competition. In contrast with the leagues in the
U.S., professional leagues in Europe report to a superior organisation. In this sense, national football
leagues in Europe are subordinate to their respective national associations as the ultimate responsible
bodies for the promotion of the sport at a national level. The main characteristics of the top football
leagues in Europe are shown in table 2.1.
In recent years, leagues have acquired a greater degree of autonomy and have even become
independent legal entities in recognition of the increasing economic importance of football, justifying a
separate and specialized administration. For instance, in 1992, the top clubs in England created the
Premier League in order to gain commercial independence from the Football League and the Football
Association (the FA), in particular, o
f r the negotiation of their own broadcasting and sponsorship
101
contracts. Even so, the Premier League remains under the jurisdiction of the FA and must submit its
102
rules every year for approval and sanction. On the other hand, the Premier League takes part in the
decision making of the FA with four league representatives participating on the FA’s twelve-member
103
board.
The integration of leagues with national associations is not only due to their mutual dependency and to
the pyramidal structure of international football but, in some cases, it is also determined by state
104
regulations. In Spain, for instance, the Law of Sport of 1990 recognises professional leagues as
entities with their own legal personality and autonomy but does not authorize a break from the sport
105
federation into which the Superior Sports Council delegates certain public functions in order to
106
assure the state intervention on sport. In France, the situation is similar. The league holds its power
107
from the federation which in turn is given power and autonomy by the state. In these cases, the
league and the federation hold their powers not only from the international governing bodies but also
from the state.
In the traditional structure of international football, national leagues had been represented by
international governing bodies only through their corresponding national associations. However, as a
result of the increasing autonomy of national leagues and recognising the need to have a greater level
of representation from them, UEFA’s Executive Committee approved the creation of the Professional
Football Committee in February 2001, as explained before.
101
The History of the FA Premier League, The FA Premier League’s web site
102
The Premier League and Other Football Bodies, The FA Premier League’s web site
103
Using the Power of Football, TheFA.com, May 5, 2002
104
Refers to Ley del Deporte de 1990 (Ley 10/1990, de 15 de Octubre, del Deporte) in TEROL GOMEZ Ramón, Las Ligas
Profesionales, Fundación del Fútbol Profesional, Aranzadi Editorial, Pamplona, 1998 and also from the web site of Liga
Profesional de Fútbol
105
Consejo Superior de Deportes or CSD.
106
TEROL GOMEZ Ramón, Las Ligas Profesionales, Fundación del Fútbol Profesional, Aranzadi Editorial, Pamplona, 1998, p.
213
107
Interview with Arnaud ROUGER
51
Table 2.1 – Overview of Top European Leagues
Country League Auto- Solida- Comp.

Clubs Main Products
(FA) (Year) nomy rity Balance
FA Premier Barclaycard
20 PL High High Low
League (1992) Premiership
England 24 Div. 1 Div. 1,2,3,
(The FA) The Football Carling Cup,
24 Div. 2 Low High Medium
League (1888) LDV Vans
24 Div. 3 Trophy
Ligue de Football
France 20 Ligue 1 20 Ligue 1,2, Coupe
Professionnel Low High High
(FFF) Ligue 2 de la Ligue
(1932)
Germany 18 Liga 1
Bundesliga Liga 1,2 High High Medium
(DFB) 18 Liga 2
Series A,B
Lega Calcio 18 Serie A
Coppa Italia Medium Medium Medium
(1946) 20 Serie B
Super Coppa
Italy (FIGC) Serie C1,C2,
Lega 36 C1 54 Coppa Italia
Professionisti - - -
C2 Serie C,
Serie C Torneo Berretti
Liga Fútbol
Spain 20 Div. 1
Profesional Div. 1, 2 Medium Low Medium
(RFEF) 22 Div. 2
(1983)
Source: Interview with Marco Brunelli, Lega Calcio, Leagues’ web sites.
It is evident that the main purpose of a league is to organise professional competitions and safeguard
its adequate functioning. According to Marco Brunelli from Lega Calcio, the main interest of a league is
to develop its own products such as the national championships, cup competitions and youth
tournaments. In order to do so, leagues have to look after the quality of the competition in sporting
108
terms but also in terms of being marketable products. In the words of Mike Foster, General
Secretary of the FA Premier League:
‘Overall, the aim is to ensure that the FA Premier League competition is of a quality
whereby it continues to attract sell out attendances at grounds and large television
audiences both in the UK and worldwide.’109
It is widely accepted that one of the basic ingredients for the attractiveness of a competition is the
uncertainty of outcome that is mainly linked to the level of competitive balance within the league.
Therefore, one of the main goals of a league is to achieve the greatest level of competitive balance. In
order to do so, a league arguably needs to have a certain degree of control over the commercial
exploitation of the competition to be able to implement mechanisms for revenue sharing and solidarity
among its clubs. However, this is a particularly difficult argument since sometimes the level of
solidarity within the league does not seem to be a determinant of its competitive balance or ultimately
of its attractiveness. We have shown in section 1.1.2 of this paper that there are other determinants of
demand for the sport besides competitive balance, and that it is the combination of those factors,
rather than one factor alone that will provide for league attractiveness. For instance, table 2.1 showed
108
Interview with Marco BRUNELLI, Representative Lega Calcio
52
that in the English Premier League in which the level of solidarity is relatively high, Manchester United
has won the title eight times in eleven years. Still, the league remains one of the most attractive in
Europe. Arnaud Rouger reflects on this issue:
‘The policies directing sport are still very intuitive and we do not know if competitive balance
is the policy to promote. Is it better to have a league fought for by only a handful of clubs
like in England or is it better to have a more balanced league like in France? The quality of
the English league is not bad. It is exciting and well exposed in the media. But in five to
fifteen years, will that change? The attractiveness of the French league is stable, while the
others have been fluctuating. Ten years ago it was Italy which had the best league, then, it
moved to England and recently to Spain.
It is difficult to say whether revenue sharing achieves its objectives. But in my personal
opinion, if you do not preserve solidarity, you are running right into the wall. You become
the organiser of professional wrestling. One key element of a sporting competition is to offer
equal opportunities to participants. That is why there are categories of weight, strength, size,
sex, etc. But one may counter-argue that when you had the Coliseum in Rome where the
Christians were being eaten by lions in an unequal “competition”, the stands were full.
However, I think we are no longer in this type of culture and modern sport must have rules
and a level of standardisation.’110
In addition to establishing the competition calendar and supervising the follow-up of the rules of the
game and other regulations, leagues also need to take additional steps to guarantee the long-term
survival and profitability of the individual clubs and, as a consequence, of the league as a whole. In
some cases, this has even been established by state regulations. In Spain, the Law of Sports of 1990
111
determined that clubs had to be transformed into a special legal entity for sports organisations and
112
assigned the responsibility of their guidance, control, supervision to the league. In France, the
113
league created the DNCG, a body that analyses yearly the club budgets for the purposes of
114
controlling recruitment of players and the fulfilment of financial criteria.
2.3. THE CLUBS
Most of our findings from the research of clubs as actors has been based on the analysis of a selected
number of clubs. Although we have no intention to generalize and extrapolate those findings
quantitatively, we do believe that the qualitative findings presented here are a good representation of
the reality of European clubs. However, we recognise that there might be some differences from club
to club and further research may be necessary to deepen the points presented in this chapter.
109
Premier League Profiles: Mike FOSTER, General Secretary, The FA Premier League’s web site
110
111
Refers to “Sociedades Anonimas Deportivas” or “SAD” from TEROL GOMEZ Ramón, Las Ligas Profesionales, Fundación
del Fútbol Profesional, Aranzadi Editorial, Pamplona, 1998 and the web site of Liga Profesional de Fútbol.
112
TEROL GOMEZ Ramón, Las Ligas Profesionales, Fundación del Fútbol Profesional, Aranzadi Editorial, Pamplona, 1998, p.
214
113
Direction Nationale de Control de Gestion – National directory of management control
114
Interview with Michel GUÉNAIRE, Head of Sport Law Division – Gide, Loyretti and Nouel.
53
As previously discussed in section 1.1.1, clubs are the fundamental cells in the development of
football. In this section our purpose is to clarify the aims, objectives and interests of these actors and
understand the means through which the clubs pursue these. Our initial hypothesis at the beginning
of this project was that not all clubs use the same means to achieve their goals. We will test this
hypothesis in this section. To do that, we have divided professional clubs in three categories based
on the criteria explained below in table 2.2, below.
115
Table 2.2 – Club categorisation
Category Criteria Example clubs selected
Well-established clubs in their domestic 1st division, routinely Juventus FC, Real Madrid
A finishing in the top places which result in consistent participation in CF, FC Internazionale
- international competition. 116
These clubs also have a market Milano, AC Milan,
Top Clubs appeal 117
which extends across the entire country with an Manchester United FC
international brand reach.
Established clubs in their domestic 1st division, finishing in the top FC Nantes Atlantique, Bayer
B
half of the league and competing for a place in international 04 Leverkusen
-
competition. Market appeal based on their city-region but with some
Medium
minor support in other areas of the country and limited international
Clubs
market appeal.
C Clubs which are trying to establish themselves in the domestic 1st Bolton Wanderers FC,
- division, routinely fighting for relegation from this division or Atalanta Bergamasca Calcio
Provincial promotion to it. These clubs are based on city-region market appeal
Clubs with no national following.
These categories are by no means exhaustive and are limited to the scope of this paper.
2.3.1. CLUBS AND THE D EMAND FOR F OOTBALL
In section 1.1.2 we identified the main drivers of demand for football. Our question now is: Is
increasing demand for football a primary objective of football clubs? Entering into this project our
hypothesis was that it is a primary objective of football clubs across all categories. And our research
118
supports that hypothesis. To look at specific examples, Manchester United has routinely enlarged
119
its ground in order to increase its live-event match day spectators. Leicester City FC, a club which
would fit in our Category C, moved into a new stadium which increased their capacity from 21,850 to
32,500 in 2002. Regarding remote spectatorship, Liverpool FC made a first in the first ever live
115
: These categories have been created with input from interviews (RUMO, OLSSON, Antonio MARCHESI, Senior Partner,
Deloitte & Touche Sports, Italy), club ranking systems and club research.
116
We define International Competitions as to include both the UEFA Champions League and the UEFA Cup.
117
Supporter-base represented by elements such as organised fan clubs, international tours by the club.
118
: Interviews with Thomas KURTH and Lars-Christer OLSSON
119
Old Trafford was enlarged from 44,000 to 56,000 in 1995-96; successively in 2000 to 61,000, and then 68,217. Man United.
has plans to increase in the future in hope of accommodating up to 90,000 spectators, but they face construction difficulties at
the current time.
54
th
streaming web cast of a match via internet for their 4 Round UEFA Cup match against SBV Vitesse
Arnhem.
But if increasing the demand for football is a wide-ranging goal encompassing many different types of
activities important to clubs, the primary objective of a football club within that range is to pursue the
best sporting performance. In section 1.1.2, we proposed that the main drivers of demand for football
are quality of the game, uncertainty of outcome, and success of one’s own team. Those three drivers
depend, in different extents, on the combination of forces of a minimum of two clubs. But the third
driver, success of one’s own team has the potential to bring individual returns directly to a specific
club. If the club is successful, the utility for the club’s fan will rise, which in turn will increase the utility
for the club. Though it may seem obvious, we must understand the elements of this objective. Seen
120
from the club’s perspective, the goal is sporting victory. Although much is written about clubs’ other
interests such as increasing brand equity, popularity or commercial success, nothing substitutes the
power of a consistently successful squad as a way to achieve those interests. Their primary goal is
thus, to win on the pitch. The financial and management principles so crucial to the success of
traditional business are secondary for a football club because a club is as good as its sporting results
121
and will always be judged accordingly.
But do clubs have other interests? The rise of the G-14 seems to indicate the positive. The G-14
Communications Manager, Geneviève Berti acknowledges another important interest for clubs: to
have a say in the process of managing European football. Traditionally clubs’ interests were
represented at national levels by the domestic league, and at the continental level by their national
associations. However, with the growth in the importance of international competition illustrated by the
increase in the number of international matches played by the top teams in Europe, as shown in
122
Figure 2.8 and when UEFA adds a CHF 55 million check to the 17 matches played by the UCL
champion, it is not surprising to see clubs wanting a more direct say in the administration of these
competitions.
Figure 2.8 – Evolution of the number of matches played by the UEFA Champions League winner
55 55
49 49 49 51 51
47 45
41 43 43 31% 31%
22% 22% 22% 25% 33%
European 28% 21% 21% 24%
12%
Matches
(UCL)
Domestic 88% 78% 78% 78% 75% 69% 67% 69%

72% 79% 79% 76%
League
Matches
1990-91 91-92 92-93 93-94 94-95 95-96 96-97 97-98 98-99 99-00 00-01 01-02
Red Star Olympique Borussia Real Manchester Real Bayern Real

Barcelona AC Milan Ajax Juventus
Belgrad Marseille Dortmund Madrid United Madrid München Madrid
Source : Euro Cups Online -http://galeb.etf.bg .ac.yu/~mirad /archive.html – and Rec.Sport.Soccer Statistics Foundation www.rsssf .com
120
Interviews with Freddy RUMO and Jeff SLACK, Director of InterActive, FC Internazionale (Italian Serie A), Michele
CENTENARO and Gianni INFANTINO, General Counsel for Commercial Legal Services, UEFA.
121
Interview with Michel GUÉNAIRE.
55
When we see the growth in the proportion of European matches it is obvious that the clubs are
gradually placing a larger emphasis on the international dimension. Add to that, the fact that the
receipts of AC Milan from the Champions League provide them currently with around 30% of their
123
annual revenues, and we can see the clubs growing push to be considered in the decision making
of these competitions.
2.3.2. THE P URSUIT OF THE GOALS
Since clubs are focused on winning matches and eventually championships, they must find ways to
efficiently employ their resources in the pursuit of their goals.
Where do those resources come from? With regards to financial resources, most football clubs rely on
the traditional revenue streams as we have seen in the section 1.1.2: Match day receipts, media
rights, sponsorship agreements, and other commercial revenues, especially merchandising. But do the
clubs identified in Category A adopt different approaches to those in Category B or C? Do Top Clubs
engage in more “business-like” activities than their peers in lower categories? Table 2.3 shows that
there does not seem to be a great difference between the clubs in different categories as far as their
business strategy is concerned.
Table 2.3 – Comparison of clubs’ business activities1
Category A Category B Category C
Business Activities Juventus Manchester Nantes Chelsea Neuchâtel Bolton

United Atlantique FC Xamax Wanderers
Gate receipts ü ü ü ü ü ü
Broadcast revenues ü ü ü ü ü ü
Sponsorship ü ü ü ü ü ü
Merchandising ü ü ü ü ü ü
Stock market ü ü No2 ü No ü
Catering No3 ü ü ü ü ü
Stadium and Facility Mgmt. ü3 ü No ü6 ü ü4
Non-football Event Mgmt. ü3 ü ü5 ü No ü5
1) Information from club websites and presentations during CIES visits.

2) Currently French Law does not allow for French football clubs to be floated on the stock market. This may change soon as
there is growing pressure from the clubs to have this option available. A recent article in France Football revealed that 15 clubs
in the French 1st division were favourable to this.
3) Juventus currently manages the Mondo Juve complex and is currently restructuring its stadium and will, after construction,
have restaurant and hospitality.
4) Includes the DeVere Whites Hotel in the Reebok Stadium.
5) FC Nantes Atlantique engages in activities such as Equestrian competitions, Weekend travel packages and Concerts while
Bolton organises conferences in the Reebok Stadium, houses the Reebok European Design Department and runs school
programmes with local schools.
6)Includes Chelsea Village Hotel
122
UEFA Financial Report 2002-2003.
123
Interview with Antonio MARCHESI
56
Furthermore, if we isolate the “Stock Market” category which is a commonly used financial tool in the
business world but still uncommon in the associative world of sport, and consider a range of clubs we
124
will find that clubs across all our three categories are using this source to raise capital.
Immediately we notice clubs which would fit our Category C such as Watford Leisure (Watford FC),
Sheffield United and Preston North End. In Category B we could identify top-division clubs with a
regional-to-national following such as Tottenham Hotspur Plc. Lastly, we also find clubs from
Category A like SS Lazio, AS Roma and Manchester United. So what differentiates these club-
categories in terms of fi nancial resources? Freddy Rumo, President of the Executive Board of
Neuchâtel Xamax, says that it is merely the scale which is important:
‘A club like Xamax does exactly what FC Basel or the bigger clubs do. The difference is
about proportion, measures and means.”125
Although clubs may have different proportions in their fan base, television rights, sponsorship and
merchandise deals and in the end very different financial means, clubs across categories use similar
tools but in proportion to their means.
But, are cash inflows an end in itself? A leader in the sports-law field in France, Michel Guénaire
states that it is not enough to have a diversified set of revenue streams without a healthy financial
management. He says that there is no long-term sporting success without healthy finances and sound
126
management principles. If we take the example of Manchester United, it is impossible not to notice
their sustainable sporting success over a little more than a decade (8 time Domestic League
Champions, 1 UEFA Champions League), but their financial health and good management are not as
externally obvious. Paddy Harverson, Director of Communications for Manchester United is quick to
point out the fact that all stadium renovations have been paid for and that United has no debts.
127
Furthermore, they were the first football club to pay dividends to its shareholders. An example
which shows poor management and inconsistent results? Here there are many examples. The
Belgian club Lommel was unable to finish the 2002-03 season because of their debts and AC
Fiorentina in Italy has paid the ultimate price and had to be liquidated and reformed as a fourth
128
division club. Arnaud Rouger from the Ligue de Football Professionnel sums up the clubs in this
way:
‘I have the feeling that all clubs are the same and marginally they are different. They have
the same constraints. They are maximisers of victories under revenue constraints. Outside
this, some have some international interests.’129
Though our initial hypothesis was that clubs in different categories use different means to pursue their
goals, our research has shown that most clubs are using a modern business approach to diversify
their revenue streams in order to be less dependent on pitch results and more pitch performant.
124
See a complete list of European clubs listed on the Stock Exchange in appendix c.
125
Interview with Freddy RUMO.
126
Interview with Michel GUÉNAIRE
127
CIES visit to Old Trafford, October 2002.
128
Sport.fr – La lettre du Football No. 20.
57
Whether this is Real Madrid through brand extension and globalisation in Category A, FC Nantes
Atlantique through developing non-football events in Category B, or Bolton Wanderers partnering with
the DeVere Whites Hotel in Category C, we have found that clubs across all categories are using
relatively the same means in different dimensions to pursue their goals.
Our research and analyses suggest that clubs are similar in their management of financial resources.
Do club-categories act differently when recruiting, developing and managing their Human Resources?
As the main Human Resource for football clubs is the players’ roster, we will focus on this area.
Rouger suggests two different strategies in this area, formation of young players or purchase of
external talent.130 But can this difference in strategy be applied in a categorical way? Our initial
response is that again, this must be treated on a case by case basis. Clubs do use different strategies
but this cannot be linked consistently with our category-criteria.
Freddy Rumo describes Neuchâtel Xamax as a regional club that develops young talent with the goal
of staying competitive in the Swiss top division. Furthermore he hopes this sustained level will allow
for the club to recruit some international players who would stay at the club for a short time and in this
way help the younger players develop. He states the club’s strategy in this way:
‘Developing young players allows us to compete with the big clubs but at a much cheaper
price. This is what we have been doing for a couple of years, what we will try to develop
even more this year and also to sustain in the next 10-20 years because of the financial
limitations the club will always have.’131
Is the strategy of “in-house” formation of players found across all categories? We have taken the
rosters from one club in each category to analyse whether this strategy is found in different categories.
In Category A, Liverpool FC, a club regularly competing in European competition with an international
market appeal and compare them with FC Nantes Atlantique in Category B and Atalanta Bergamasca
Calcio, a club competing to stay in Italy’s Serie A.
Table 2.4 – Players coming from youth divisions
Club and Category Total Players Players from Club Percentage
Liverpool FC-Cat A 30 8 27%
FC Nantes Atlantique-Cat B 28 17 61%
Atalanta Bergamasca Calcio-Cat C 26 9 35%
Source: Based on Rosters as of June 25, 2003. Information gathered from club and league websites.
Our Category A club uses less than 30% of its Human Resources from its own developed players
which is not identical with the Neuchâtel Xamax strategy. FC Nantes Atlantique is heavily reliant on
home-grown players with over 60%. Lastly Atalanta, in the same category of Xamax, although well
known for its policy of youth development is currently relying on just over one-third home-grown
129
130
131
Interview with Freddy RUMO
58
players, probably because it has already sold a large portion of the players it has formed in the last
years. The variance is probably due to a difference in strategy. If we take one last example, another
successful club from Category A, Manchester United, we can see a percentage of 52% of their
132
current roster issuing from their youth development programme.
Another common strategy is to seek the best talent from outside the club’s area. Though the effects of
the Bosman judgement will not be treated here, this has opened the door to more top professional
players to enter leagues which are “shopping for players”. Again we will search for whether there are
differences in how different categories of clubs act in the market for buying foreign players.
Figure 2.9 shows the number of foreign players per club in the FA Premier League in 1998-99.
Figure 2.9 –Premiership Foreign Players season 1998/99:
A
C
B A
C
19
16 16 C B
13 12 12 12 11 11 11 10 9 8 7
5 5 4 4 3 3
rby
l
gh
ea
ton
on
oo
td
n
tle
am
n
al
am
ed
n
ntr
la
ur
ity
td.
pto
nU
en
do
ert
ou
els
De
as
t
erp
arl
res
Vi
W
ve
kb
sU
nh
rC
tH
Ars
Ev
ble
am
'br
wc
Ch
Ch
Ma
Co
Fo
Liv
ton
ac
eff
tte
es
ste
ed
im
Ne
S'h
Sh
To
Bl
ttm
As
Le
W
ice
No
Le
Source : Sir Norman Chester Research Centre, Fact Sheet 16 :The Bosman Ruling, Football Transfers and Foreign Footballers
West Ham, a Category-C club has 9 foreign players while Man United, a Cat -A club has only two more
at 11. Compare this with Chelsea’s 19 foreigners for a Cat-B club and we can see from the English
data that again relying on foreign players is just as much an individual club strategy as the reliance on
home-grown youth players.
In conclusion, although the scale may be different, clubs across all three of our categories are
engaging in similar activities in proportion to their means, both in the financial and human resource
areas as crucial elements to the fulfilment of their ultimate goal, pitch success.
132
FA Premier League website. June 25, 2003.
59
2.4. G-14
The G-14 is a Lobby Group headquartered in Brussels, formed by 18 of the most important clubs of
133 134
Europe both in sporting and financial terms. Figure 2.10 lists the members of G-14, which are
actually 18.
Figure 2.10 – The 18 Members of G-14
AC Milan FC
Olympique de Internazionale
Marseille Juventus FC
Milano
Paris Saint- FC Barcelona
Germain
Manchester THE VO IC E O F THE C LUBS Real Madrid

United FC
CF
Liverpool FC AFC Ajax
PSV
FC Porto
FC Bayern Borussia
München Dortmund
Bayer 04 Arsenal FC Valencia Olympique

Leverkusen CF Lyonnais
Source: G-14
According to Geneviève Berti, Communications Manager of G-14, the group is actually formed by the
individual members comprising the key leadership roles from the member clubs. She explains:
‘The Group is based on and is the reflection of the personal relationships between G-14
135
member clubs top executives rather than the grouping of clubs as organisations.’
2.4.1. THE L EGAL FORM OF G-14

136
Legally the G-14 is an EEIG (European Economic Interest Grouping) . An EEIG is an association
linking organisations from different countries within the European Community that need to work
together, enabling them to do business across national boundaries. Often when organisations from
133
G-14 clubs have won 82% (27 out of the 33) of the titles at UEFA Champions League / The European Club Champions’ Cup
from 1971 to 2003.
134
In the 2003 edition of the World’s Richest Football Clubs list by Worldsoccer Magazine, eight out of the top ten clubs are G-
14 members (Madrid, Man United, Juventus, Bayern, Milan, Barcelona, Liverpool and Arsenal). Chelsea and Roma complete
the top-10 list. The list is based on the clubs’ revenues in the season 2001/2002.
135
Interview with Geneviève BERTI
136
EEIGs are regulated by the Council Regulation (EEC) No 2137/85 of 25 July 1985.
60
different countries work together, they work within a national legal system that is unfamiliar to some
members. EEIGs work within a neutral legal framework that is independent of individual national legal
systems. This means that all members are on an equal footing in terms of their familiarity with the law.
It is not intended that an EEIG should make profits for itself. If it does make any profits, they should be
apportioned among the members and taxed accordingly. An EEIG is legally separate from the
businesses of its owners, although it exists to carry out tasks for them. EEIGs can operate anywhere
within the European Community (EC) and can also form links with organisations in countries outside
the EC. The contract for the formation of an EEIG must be filed at the registry designated by each
member state. Registration in this manner confers full legal capacity on the EEIG throughout the EC.
2.4.2. THE CREATION OF THE G ROUPING
The idea of the creation of G-14 dates back to 1998 and has its origins in informal and occasional
meetings between eight clubs (AC Milan, Juventus, Internazionale Milano, Real Madrid, Barcelona,
Ajax, Liverpool, Bayern München) who were constantly involved in the context of international
137
competitions and shared a number of common issues and challenges. Later on, conscious of the
benefits of those meetings the eight initial clubs invited six other clubs with comparable sporting
performance (Manchester United, Olympique de Marseille, Paris Saint-Germain, PSV, Borussia
Dortmund and FC Porto) to join them, forming the original Group of 14. In July 2000, the group
announced the hiring of Thomas Kurth as the General Manager of their forming organisation. That was
the first step in the formalization of the group. It was a very relevant step from a strategic point of view,
since Kurth at that time was the head of UEFA’s Club Competition Department, a key figure in the
logistical organisation and running of UEFA Champions League competition.
In November 2000 the G-14 was officially established, eventually opening their office in Brussels in
March 2001.
In August 2002, the group unanimously voted to invite four additional clubs (Bayer 04 Leverkusen,
Valencia CF, Arsenal FC and Olympique Lyonnais) expanding its membership structure to the current
18 clubs shown in Figure 2.10 above.
Notwithstanding the expansion, it was decided that the name G-14 would be kept in recognition of the
pioneering role which the 14 historic clubs played in founding the group and to leverage on the fact
that the G-14 was becoming an ever more recognised name on the international club football scene.
Figure 2.11 –G-14 – Major milestones
1998 1999 Jul ‘00 Sep ‘00 Mar ‘01 Aug ‘02
Eight clubs Six clubs are Thomas Opening of Final

start meeting invited to join Kurth hired the office in expansion to
informally the group from UEFA Brussels 18 clubs
G-14 acquires
legal
Source: G -14 Press release, G -14 Statutes, Clippings personality
137
Among other things, the eight initial clubs all had in common the fact that they had won at least 5 continental titles each.
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2.4.3. OBJECTIVES
The purpose of the G-14 as stated in article 1.4 of their statutes is:
§ To promote the cooperation, amicable relations and unity of the member clubs
§ To promote and improve the professional football competition in all its aspects and safeguard
the general interests of the Member clubs
§ To aid the exchange of information between the Member clubs
§ To promote the interests of the Member clubs and to consider the collective affairs important
for said clubs
§ To negotiate the format, administration and operation of the club competitions with the FIFA,
the UEFA and other sports institutions
§ To perform the economic activities necessary for the Grouping
Although not present in the statutes, the group’s official press release adds the following purpose to
that list:
§ To promote co-operation with UEFA, FIFA, other clubs, Institutions, etc.
In practice, The G-14 aims to be the consensual voice of the clubs. In its press kit, the group states
that given its character and the mix of identities generated by the international origin of its member
clubs, the grouping has to face a significant challenge: to represent and promote and safeguard the
interests of its members through a consensual approach. On the way to consensus, issues may arise,
such as:
§ conflicting priorities of member clubs in terms of global strategies, timing, or even competitions
§ conflicting contexts of member clubs in terms of domestic resources, impact, development

perspective and level of competition.
The text goes further stating that in the current context, football clubs are no longer solely dedicated to
hiring football players and playing games to win titles and trophies. The constant challenge of the
evolving level of expectations of football amateurs and fans has put the focus on the necessity for
football to open the door to professionalism and expertise in everything both on and off the pitch. So,
football clubs have become football “companies” whose daily activities also rely on abilities outside of
sport. Given those elements, football clubs nowadays have to accept reforms, rules and laws which
have been conceived without their input or opinion: it is important to take this into account.
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The press kit ends stating that Football clubs have to face the future of their sport.
2.4.4. THE STRUCTURE OF G-14
The structure of the G-14 is composed basically by three main organs as shown below.
Figure 2.12 – Structure of G-14
138
Excerpts from G-14 Press Kit – p.10
62
Organs Main responsibilities
•Convenes at least 4 times a year – 3 ordinary and 1 statutory meeting
•Votes on global strategic, policy, and consensual decisions
General Assembly •Approves the financial accounts
•Nominates the members of the Management Committee
•Admits new members, removes or suspends current members
•Meets at regular intervals during the year

•Gives strategic instructions to the General Manager in accordance with the General
Assembly statements
•Acts as chief spokesperson for the group
Management Committee
•Present strategic, financial, commercial, operational or policy proposals to the
General Assembly
•Composed by 1 chairman, 4 vice chairman, and 1 observer in mandates of one two-
year period with a two-year single renewal option, besides the General Manager.
•Responsible for the daily running of the activities designed to achieve the objectives
specified by the General Assembly
General Manager /
•The operational structure headquartered in Brussels is composed by the General
Operational Structure
Manager, the Administration and Finance Manager, the Communications Manager
and two assistants
Source: G-14 Statutes, Press Release
The voting rights at the General Assembly are based on a system that takes into consideration the
sporting performance of the member clubs:
§ 3 votes for each of the founding members
§ 1 vote for each of the non-founding members
139
§ 2 votes for each of the Champions League Cup won by each member
§ 1 vote for each of the UEFA Cup Winners’ Cup won by each member
140
Based on this system, the current power structure within the G-14 is shown on Figure 2.13.
Figure 2.13 - Summary of G-14 votes as of Jul ’03 – Total 147
France Portugal
Ol. Marseilles 5 Porto 6 Italy
Paris St. Germain 4 Milan 17
Ol. Lyonnais 1 Total 6
Juventus 11
Total 10 Inter 10
Netherlands
Total 38
Ajax 13 4%
7%
PSV 6
26%
Total 19 13%
14%
20%
16%
Germany
Bayern 13
Dortmund 6 Spain
Leverkusen 2 Real Madrid 18
England Barcelona 9
Total 21
Liverpool 14 Valencia 2
Man Utd 8 Total 27
Source: G-14 voting system
Arsenal 2
Total 24
139
Former European Club Champions’ Cup
140
A table demonstrating the voting calculation for each member club can be found in appendix d.
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Although the General Assembly is the highest authority in the structure of G-14, it is the Management
Committee that is the “de-facto” leading organ in the structure of the lobby group. Geneviève Berti
explains:
‘The general process of G-14 is that the Management Committee proposes presentations
and the General Assembly debates the possibilities and decides on a common position.
From this position, the G-14 then defends it externally.’ 141
Describing the role that the members of the Management Committee play, Berti explains that the
seven gather a broad set of expertises within the European sporting context:
Pedro Lopez Jimenez – Board Member of Real Madrid: Represents the political expertise from Madrid.
He directs the group in terms of its actions as a political lobby and gives context to the issues within a
wider political form. (NB. Jimenez is the replacement for when Real Madrid President, Florentino
Perez is unable to attend)
Karl Heinz Rummenigge – Vice President of Bayern München: Represents the sporting legitimacy of
the group. Being involved in several FIFA and UEFA committees, having been a top professional
respected everywhere, he serves as the “ambassador of the G-14” because of his widely regarded
expertise.
Peter Kenyon – CEO of Manchester United PLC: Comes from the business world but is not alienated
from sport (previously worked at Umbro). He understands the various responsibilities and pressures
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faced by clubs since he runs a PLC, He brings the business support necessary for the association’s
pursuit of the game and its spirit. He acts as a “CEO for G-14”. (NB. Not officially with Chelsea FC yet,
Kenyon will be leaving MU and his role within the G-14)
Umberto Gandini – Sporting Director of AC Milan: Has the overall understanding of the technical and
sporting matters in a wider frame. (NB. Gandini is the replacement for when AC Milan Vice-President,
Adriano Galliani is unable to attend)
Michael Van Praag – President of Ajax: Acts as the “Financial Expert”, besides bringing knowledge in
the sporting side with development, recruitment and transfer of players.
Thomas Kurth – General Manager of G-14: Brings the institutional knowledge of having worked for
many years at UEFA. He understands how to address issues within a community of institutions.
The observer member representing the French clubs used to be Laurent Perpère, former chairman of
Paris St-Germain, but as he stepped down from his responsibilities at the club, he is being replaced by
Francis Graille also from Paris St.-Germain, but this position is not yet consolidated.
The group also counts on an operational structure that among other things is responsible for
implementing and conducting the operational side of G-14 activities.
141
142
Public Liability Company
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3. CHAPTER THREE: THE CONFLICTS
The objective of this chapter is to identify the main conflicts impacting the current reality of European
football and investigate their root causes. The analyses in this chapter rely on the main findings from
the previous chapters of this paper, with special attention to the description of the actors in chapter 2,
and the stakeholders’ map from section 1.1.3. We begin by analysing the main areas of convergence
and divergence in the interests of the actors, followed by a description of what have been the major
conflicting areas in the recent past, specifically between UEFA and the top clubs. We finalise the
chapter with an exercise of designing scenarios for European football based on the possible next
moves of the actors.
3.1. CONVERGENCES AND DIVERGENCES OF INTERESTS
The scope of this section is focused on three main actors: UEFA, the national leagues, and the clubs.
We will assume that the interests of the national associations are well represented at UEFA as
presented in section 2.1.4, and we will assume that other important stakeholders, such as media,
sponsors and fans have limited direct control in the process of production of the game in itself, and are
143
more concerned with the final product.
Figure 3.1 summarises the main interests of UEFA, the national leagues and the clubs based on the
findings from chapter 2, and illustrates the areas of convergence and divergence among them.
Figure 3.1 – Map of convergence and divergence of interests
CLUBS
UEFA
Promote football in all
its forms throughout Attain best sporting
the continent Optimise performance
Follow a long term commercial
vision for the potential of
development of the continental Respond to short
game competitions term pressures of
stakeholders
Regulate football
Maintain sovereignty in Europe
of National Maximise individual
Associations returns
Increase demand
Promote solidarity for football
among leagues and
national associations Regulate the
activity of clubs Optimise
commercial
potential of the
Increase the quality domestic league
of the domestic
game
Promote solidarity
among clubs
LEAGUES
65
As we can see from Figure 3.1, there is one main area of interest in which the three actors converge:
They all want to increase the demand for football, which in simple terms means increasing the number
of people interested in the game of football. This is the starting point, and although there might be
many disagreements as far as the most suitable strategy to be adopted to reach that goal, there are
no questions that, as interest for the sport rises, all stakeholders benefit. Again, we see the fan as the
focal point.
It is important to remark that increasing demand for football is not a passive activity, as many people in
the industry seem to think. Football is the most popular sport in the world today, but there are many
other sports, and leisure activities competing for a share of the attention and income of the population,
and although it might not happen from night to day, there are no reasons to believe that football will
enjoy its current comfortable position in the preference of fans perpetually. Increasing demand for
football is an objective that has to be kept in the mind of the actors at all times when making decisions
about the production of the game.
We will now take a more systematic look at the areas of convergence and divergence between the
actors.
3.1.1. UEFA AND THE L EAGUES
UEFA and the national leagues have many common points of interests. Both want to increase the
quality of the domestic game, as UEFA knows that the strength of the link between the supporter and
football has local and national roots. This can be seen from the fact that UEFA distributes part of the
revenues from its premium competitions to national associations and national leagues, and from the
fact that UEFA uses sporting results in the domestic scenario as the main criteria for eligibility to
international competitions.
A second area of convergence lies in the fact that both act as market regulators, guaranteeing that
football clubs are doing their share in the long term development of the game. The Club Licensing
System is an example of such interest, and as we have explained, while a priori, the national
associations will be responsible for assuming the role of licensors, they have the right to delegate that
task to the national leagues. In Italy for example, the Lega Calcio will be the licensor for the UEFA
Club Licensing System. But this regulating activity has been in place for a long time before the Club
Licensing System, since leagues have to look after the financial health of clubs in order to assure the
survival of the competition. This type of control is particularly strong in France where the League
decided to relegate AS Monaco, second of the latest French championship and qualified therefore for
the next Champions League first group phase, into the second division since their budget was not
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meeting the League’s criteria.
The divergences between the leagues and UEFA arise mainly from differences in the scope of
activities. While UEFA is concerned with the development of all forms of the game in the continent, the
143
Although we recognise that this assumption may not be completely true, as there are many cases of TV companies directly
influencing decisions concerning the format and calendar of competitions, but we will treat this as the exception and not the rule.
144
This decision however was not confirmed, after the club lodged an appeal to the competent body.
66
league has a national scope, and is concerned with the game of professional club football in its elite
form. While UEFA (and the national associations) will divert investments for grass root development,
and make use of national teams to improve the popularity of football, leagues are primarily concerned
with the quality and the commercial exploitation of the specific competition they organise.
The divergence in the geographical scope of competitions is a relevant one for two main reasons.
Firstly because domestic and continental competitions have to share the same calendar. Thus,
decisions about competition format made at one level, directly affect the other level. Secondly because
it generates an area of divergence between the leagues and their member clubs. Usually an increase
in the competitive balance of the domestic league, promoted through solidarity measures within the
league will directly impact the competitiveness of the clubs in the continental level. Arnaud Rouger,
representative of the Ligue de Football Professionnel in France describes this situation in detail:
‘Every league faces a pressure to manage its championship with the recognition that
some of the clubs will participate in international com petition. This is a delicate situation
because the league has to preserve its national championship while still trying to satisfy
the clubs which want to qualify for these international competitions. Thus the league faces
a political decision regarding income redistribution. The league may decide to unbalance
the redistribution and favour the clubs at the top of the league with the intention of helping
them in international competition, or to adopt a more equal redistribution, which might
impair the competitiveness of its clubs internationally. If it chooses the first alternative, it
runs the risk of harming its primary product, unbalancing the national competition and
undermining public interest. The French league is caught between these two positions.
There is a well balanced redistribution in the entirety of the league, but in the eyes of the
big clubs, it is not enough catering to them.’145
Finally a more subtle divergence arises from the interest of leagues in optimising the commercial
potential of their competitions and the interest of UEFA to maintain the sovereignty of the national
football associations. While confined in the national territory, the commercial potential of league
competitions is constrained by some external variables that are not under the control of the league.
One important external variable is the size of the Television market in a determined country. It is well
known that different countries, despite the passion of the population for the sport, have different sizes
of television markets; Figure 3.2 illustrates that situation showing that there is little correlation between
the size of the crowds in the stadiums with the average domestic TV income for the league. Therefore,
one of the alternatives to increase the commercial potential of domestic league competitions is to
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create trans -national alliances between leagues as it has already been proposed in the past, the
organisation of the North Atlantic League comprising clubs from Scotland, the Netherlands, Belgium
and Portugal. UEFA strongly repels this idea as it would undermine the sovereign authority of the
national associations, over which its power structure is built.
145
146
Although the idea of trans-national leagues most of the times come from the clubs themselves, rather than the domestic
leagues
67
Figure 3.2 – Correlation between average league attendance and TV Income - 2000
35 Top Italian Clubs

Top English Clubs
2001+
30
25
Average domestic TV income (€m)
Top Spanish Clubs
Middle Italian Clubs Top English Clubs

20 Top German Clubs
15
Bottom German Clubs
Middle English Clubs

10
Bottom English Clubs Top Scottish Clubs

Top Portuguese Clubs
5
Top Dutch Clubs
Top Danish Clubs
Top Belgian Clubs
0
0 10 20 30 40 50 60 70
Source: Clubs’ annual reports, O&O analysis Average attendance (‘000)
3.1.2. UEFA AND CLUBS
‘I think the objectives of clubs and UEFA are

sometimes the same, sometimes they are not’
Michele Centenaro147
We have argued that increasing demand for football is one of the areas of convergence of interests
between clubs and UEFA, as confirmed by Thomas Kurth, the General Manager of G-14:
‘UEFA and the clubs have similar objectives as far as top level club football is concerned,
which are to keep the game attractive, to maintain or increase the overall audience be it
through the media, be it on site, to further develop the game, I think they have very similar
objectives’148
147
Interview with Michele CENTENARO
148
Interview with Thomas KURTH
68
Additionally, in times of globalisation and of a united Europe, both agree that there is growing demand
for international competitions at the European level. But the convergence of interests stops at the high
level. It is in the details that the divergences appear.
We can identify two major dimensions of divergences between UEFA and the clubs. The first is linked
to the time frame of decisions made by these actors. While UEFA tries to implement a long term vision
of development of the game, the clubs, by the nature of their activities and the pressures exerted by
their stakeholders, have to make decisions with a much shorter time frame in mind. Lars-Christer
Olsson explains the reasons for this:
‘The clubs operate on a day-to-day business. There are obligations and pressures that
exist in this reality which UEFA does not face. They have to find finances for the salaries
tomorrow, we do not. The environment is different. The clubs are immediately exposed to
the competition between themselves. UEFA does not operate in this competitive
environment. UEFA works on the long-term securitisation of football. The decisions we
make today will have an effect in a year or two. We can already see the problems clubs
face with short-term decisions. When there is a downturn in the market it is a disaster for
the clubs. There is an immediate financial effect on the clubs.’ 149
Peter Gilliéron, the General Secretary of the Swiss FA complements:
‘The pressures are different. The Clubs have a more constant daily pressure because of
their daily contact with fans and stakeholders. They face their stakeholders every week
for 10 to 11 months of the year being constantly interrogated by the press. UEFA suffers
fewer pressures because of their limited contact with the stakeholders. The pressures
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they suffer are more indirect.’
The second dimension of divergence is linked to the fact that clubs, although aware of the general
importance of collaboration with other clubs, still keep a very fragmented and individualistic view of the
game. Since clubs want to pursue the best sporting performance, they must compete among
themselves for the best players, and more recently, for the attention of the global market, and this, as
we know, costs as much money as the clubs can get. UEFA on the other hand, has a more holistic
view of the game and wants to make sure that the game as a whole is being developed, and this also
costs money. As clubs and their governing body are often sharing the same ‘pie’, conflicts regularly
break out about the most appropriate way to divide this pie. We have already shown that UEFA relies
mainly on the organisation of UEFA Champions League and the Euro to fund its activities, and both
competitions rely mainly on resources of the clubs. It is a complex task to convince the clubs of the
importance of devoting a given share of those resources to the development of women’s football,
amateur championships, or professional leagues in smaller countries such as Armenia or Moldavia,
since they cannot grasp what is in it for them in the short run.
Finally there is the conflict along national team football. Although it is clear for the clubs that a
competition like the FIFA World Cup adds to the popularity of football, eventually reverting in benefits
149
150
Interview with Peter GILLIÉRON
69
for the clubs, there has been a great commotion lately about the right balance between club and
national team football, with the clubs arguing that there are today too many meaningless matches and
tournaments involving national teams.
3.1.3. LEAGUES AND CLUBS
The nature of the divergences between leagues and clubs is similar to the one presented in the last
section between clubs and UEFA. Although in general terms, leagues and clubs are both interested in
the development and quality of the domestic competition, conflicts arise from the distribution of
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revenues.
Leagues have two main concerns. First and foremost they want to guarantee that all clubs
participating in the league will stay in business for the longest time possible, but at least until the end
of the season. The fact that Fiorentina, a traditional Italian club was forced out of business because of
financial difficulties had negative impacts for the entire Serie A of the Italian League. We can argue
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that an Italian league without Fiorentina alienates the interest of the Fiorentina fans immediately
causing a reduction in the size of the Italian football market. The second concern of leagues is the
production of a balanced competition in the sense that competitive balance will produce uncertainty of
outcome, and unpredictability is one of the most important characteristics of the product supplied by
the Football industry as argued earlier.
153
Szymanski and Kuypers state that the main threat to the competitive balance of the league is the
unequal earning power of the member clubs. They demonstrate through regression analysis of
historical data of English Football, that in the long run, club expenditure leads to success on the pitch
and success on the pitch increases revenues. However there are some external constraints in the
earning power of clubs as clubs have different fan bases. Although clubs can try to increase their fan
base by increasing their winning ratios and by using modern marketing strategies, there are a number
of variables over which clubs have little control that limit that action. Those variables are for instance,
the size of the club’s catchment area and the tradition of the club. As a result of the different sizes of
fan bases, the natural share of income between clubs will be uneven, thus harming competitive
balance as the richer clubs will always be able to bid higher for the most talented players. The most
common way to address that imbalance is by cross-subsidization, or to make use of a less economic
and more romantic term: solidarity. In practice it means that the league draws on revenue distribution
among the member clubs. The most common forms of revenue distribution utilized by leagues are
151
This divergence has been highlighted last April by the crisis that broke out between Bayern München (BM) and the German
football league after the latter announced publicly the existence of a secret contract between the now bankrupted company
Kirch and the most successful German team. This contract implied the payment of 90 million euros by Kirch to BM over five
seasons, ending in 2004-2005. It was meant to compensate the loss suffered by BM in a process of central selling of the rights
of the German championship so that BM would not support an eventual reform toward individual selling where the latest
German champion could obviously increase its revenues. In the end, only 21,5 million euros were paid by Kirch before it went
bankrupt but the announcement of this agreement and the critics of BM’s attitude by some league representatives did not
please BM managers whose behaviour was characterized as ‘morally reprehensible’ and who decided in April to withdraw
temporarily all their representatives on league commission as a protest signal. www.fcbayern.st.fr
152
Alienates or at least reduces. Since one of the characteristics of football fandom is the lifelong loyalty of allegiance to a club,
we can argue that although it is possible that a Fiorentina fan will still turn on the TV to watch a match between Roma and
Juventus their level of consumption of football will drastically decrease.
153
SZYMANSKI & KUYPERS, Winners and Losers – The business strategy of Football, Penguim,1999
70
some sharing of gate receipts between home and away team, and the central exploitation by the
league of the commercial and TV rights of the competition for further redistribution among the clubs.
The league would be the best positioned body to coordinate revenue sharing since although each club
recognises the incentive to co-operate in order to improve the outcome for all, each club privately has
an incentive to opt out of any agreement and pursue its own interests.
But the current configuration of the European football competition scenario adds complexity to the
equation, as explained earlier. In order to be competitive at the European level, a club must invest in
addition to the level necessary to be competitive at the domestic scenario. This creates a conflict of
interest between these two scenarios. The richer clubs will not be as willing to redistribute their
revenues at the domestic level, since this would harm their competitiveness at the European level. It is
no surprise that top clubs will pressure against the national league for the reduction of revenue
distribution measures to a minimum level necessary to guarantee the survival of the domestic league,
thus producing imbalance at the national level. Put in simple terms, if Manchester United, Arsenal and
Liverpool distribute too much of their revenues to the poorer clubs in the Premier League, they will
lose competitiveness against Milan, Real Madrid, Juventus, Bayern München. But at the same time,
there will be no Premier League with only three clubs, and as shown earlier in this paper, the domestic
scenario still represents the most important source of revenues for club football.
3.1.4. G-14 AND OTHER CLUBS
From our chapter on clubs we have seen that most clubs are engaging in similar financial and human
resource management practices to pursue their objectives. Here we analyse specifically the areas of
convergence and divergence between the top clubs forming the lobby group and their siblings.
The first of these areas of convergence is that clubs want to have a voice in the decisions of football’s
management. Geneviève Berti states that “all clubs want a voice in the game, but G-14 groups the
154
clubs best-placed to speak because of their status”.
A second area of convergence is the fact that clubs need each other to produce a championship. The
clubs in G-14 need their less glamorous domestic opponents to produce the domestic league, which is
their main source of revenues, as shown before. But the dependence between G-14 and other clubs is
not only financial, but also in terms of the supply of talent. Figure 3.3 illustrates that. We have selected
the most important players of the G-14 clubs at the latest edition of the UEFA Champions League
based on their performance on the pitch and their ability to attract audience. Although we recognise
that the selection criteria still bears some degree of subjectivity, as football fans could argue for hours
and still not agree on what the most important players of their teams are, we believe the list of players
selected is representative. Our analysis show that from a list of 42 selected “stars”, only 8 were formed
by G-14 clubs. The remainder has been formed by a large variety of clubs including clubs that will
154
71
155
hardly ever acquire the status of G-14 clubs, such as FC Den Bosch from Holland, Leffe from
156 157
Italy or ZVZ Milevsko from the Czech Republic.
Figure 3.3 – The G-14 Stars at the UCL 2002/03 – Where are they formed?
The G-14 stars – Where are they formed?
42 11
27%
31 8
19%
100% other 23 15
countries
45%
36%
73%
55%
‘Big 5’
countries 8
55% 19%
G-14 Stars Non-Europeans Europeans Countries G-14 Clubs G-14

outside G-14 countries outside G-14 Members
The 42 G-14 stars in the UEFA Champions’ League 2002/03

Milan Juventus Inter R. Madrid Ajax Man. Utd. Valencia Arsenal Ol. Lyonnais
Inzaghi* Nedved* Crespo* Raúl* Ibrahimovic* Van Nilsterooij* Carew* Henry* S. Anderson*
Rui Costa+ Camoranesi+ S. Conceição + Guti* Solskjær+ Campbell• Carriére +
Barcelona Aimar +
Ronaldo* Verón+ Leverkusen
Seedorf+ Del Piero* Vieri• Saviola*
Figo + Beckham+ Dortmund Babic*
Kluivert*
Maldini• Di Vaio * Cannavaro • Zidane + Rio Ferdinand• Koller*
Riquelme + Liverpool
Rivaldo • Buffon Recoba • R. Carlos• Xavi+ Roy Keane • Rosický+ Owen •
Note: 1) The stars were chosen based on the following criteria: *scored at least 4 goals in the competition, + made at least 3 goals assists, • among the 20
best paid footballers in the world
Source: Authors’ analysis based on UEFA.com statistics, Soccernet top-20 world’s best paid footballers 2003
But although the clubs and G-14 do share common links, the areas of divergence are strong. Freddy
158
Rumo identifies a very different perspective on European competitions. He says that for G-14
clubs, competition in the UCL is so important to them financially for the advantage it gives them
domestically, that he even questions whether they have sincere sporting interests in these
competitions. For his club, Neuchâtel Xamax, and other non-G-14 clubs, he says the participation in
European competition is the “cherry on the cake” and represents the supreme reward for clubs and a
bonus for supporters. For the big clubs, it is a must. Michele Centenaro of UEFA adds that big clubs
want to guarantee that they will play only big clubs at European competition, increasing the financial
159
return of their participation, and if possible decreasing the participation of less expressive clubs.
Freddy Rumo also raises a final diverging element coming from the different sizes of the fan base: The
quest for the global market. He says that Xamax should remain a regional club aimed at developing
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Ruud Van Nistelrooij, top scorer for Manchester United at the UCL 2002/03 with 12 goals.
156
Inzaghi, top scorer for AC Milan at the UCL 2002/03 with 10 goals.
157
Koller, top scorer for Borussia Dortmund at the UCL 2002/03 with 8 goals.
158
Interview with Freddy RUMO.
159
Interview with Michele CENTENARO.
72
young talent since they can obviously not compare to a club like Real Madrid which has 150,000
160
paying socios”. Jean-Paul de la Fuente enlarges the picture when he says that G-14 represents,
between them, 150 million fans in Europe and 250 million worldwide. Jeff Slack, from FC
Internazionale, identifies globalisation and brand extension as two fundamental aspects of Inter’s
marketing strategies.
3.2. PAST CONFLICTS BETWEEN TOP CLUBS (G-14) AND UEFA
Having analysed the major areas of convergence and divergence of interests among the actors, we
will now take a closer look on how the divergences between the top clubs and UEFA have translated
into conflicts between those two groups, with a special interest in understanding the way in which
those conflicts have been managed.
3.2.1. COMPETITION
The design of competition formats at the European level has crystallized into several conflicts between
UEFA and the clubs over the last decade. Neither the clubs, nor UEFA seem to have been contented
by the different formats adopted for European competitions in the past years. This dissatisfaction has
lead to a large number of reforms of format throughout the years, as the last announcement by UEFA
of a modification of the Champions League for the period 2003-2006 illustrated once more in July
2002.
This divergence of opinions has opened the doors to a wide range of proposals by different
stakeholders. Some of them have been implemented, some have not, with the last word in the matter
always belonging to UEFA who is the official body in charge of the competition format. We will now
have a look at the evolution of Champions League since its creation to better understand how
unstable is the format of European club competition and how UEFA has tried to respond to the many
161
demands issued by its different stakeholders, and in particular the clubs.
The evolution of the competition format since 1992
Conflicts about the competitions format have impacted significantly the design of European football
competitions since the beginnings of the 1990s. It is indeed at that time that the Champions League
was launched. It succeeded the former Champion’s Cup which began in 1955/56 and was organised
on a knockout basis. The format adopted in the inaugural UCL in 1992/93 was made of two knockout
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rounds, followed by a group stage involving two sets of four clubs playing home and away and
finally the two group winners contesting for the final.
A similar format followed in the 1993/94 season, although a two-legged semi-final stage involving the
top two clubs from both groups preceded the final. The competition expanded to 16 clubs in the group
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Furthermore, FC Internazionale boasts 800 fan clubs worldwide, 70,000 registered members and 180,000 registered users
of their multimedia site, www.inter.it. interview with Jeff Slack, Director of Inter Active of FC Internazionale.
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Proposals have obviously been made by UEFA, by the clubs or by G-14 but also by some ‘external’ stakeholder such as
Media Partners, a marketing agency, or some private Spanish investors willing to exploit the potential commercial value that a
European top level league could generate.
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It was the group stage made of eight teams that was called the Champions League.
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stage for the 1994/95 season. The first knock-out rounds were eliminated with the exception of one
qualification round played by 16 clubs. Eight clubs from the qualification round joined other eight clubs
that got byes in the group stage where the clubs were divided in four groups of four playing home and
away within the groups. Again, the top two clubs in each group advanced to the knockout stage, which
meant an additional quarter-final phase was required. The next change came at the start of the
1997/98 season as the competition underwent another phase of expansion. Now two qualification
rounds were required to define sixteen clubs to join the eight clubs that qualifi ed directly. The group
stage then had been expanded to 24 clubs divided in six groups of four clubs each and for the first
time, more than one club from the same country was given entry to the competition. The six group
winners and the two best runners-up advanced to the knockout stages of the competition.
In 1999/2000, a new change came into place. Three qualification rounds were required to define 16
clubs that would join the 16 automatic qualifiers, who then contested the first group stage comprising
eight groups of four clubs. The winners and runners-up from these eight groups then advanced to the
second group phase consisting of four groups of four. The top two teams in each of the four groups
then contested the quarter-finals over two legs. The winners advanced to the semi-finals that were
also played over two legs. From the two semi-final ties, the two winning clubs played the final match.
Finally, in July 2002, UEFA announced that for the season 2003/04 the second group stage would be
eliminated. According to Jérôme Champagne, Deputy Secretary General of FIFA those six
modifications over the course of 12 seasons, delivers a proof that the competition model is not
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completely connected with the public expectations.
Figure 3.4 gives us an overview on the six changes of format of the UEFA Champions League over
the last 12 seasons, and the growing participation of G-14 clubs.
Figure 3.4 – Evolution of the total number of matches played at the UEFA Champions
157 157 157 157
26
More than 48 46 40
125
one club
per country
Key:
Others x Others 85 85 80
G-14 x Others 20 22 86
G-14 x G-14 61 61 61 82 84
18 16
26
50 48
25* 27*
30 34 51
6 8 26
12 15 27 27 31
7 4 13 9 11 15 15
92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04
# Teams 8 8 16 16 16 24 24 32 32 32 32 32
G-14 4 4 6 5 6 10 10 12 12 12 15
Notes: * Not considering the knock-out rounds preceding the group stage
Source: The Rec.Sport.Soccer Statistics Foundation, analysis of the authors
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Interview with Jérôme CHAMPAGNE, Deputy Secretary General, FIFA
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We were not able to identify if the idea for the changes were generated spontaneously by UEFA or if it
was a response of the Governing Body to the pressure of the top clubs. However, by looking at Figure
3.4 one thing is clear: with the exception of the most recent change, all format changes were designed
for the increase in the number of participants to the competition and a consequent increase in the
number of matches played. And we can see that the major beneficiaries of those changes were the
top clubs, especially as of season 97/98 when UEFA admitted the participation of more than one club
per country in the championship. Figure 3.4 also gives us a hint on why the clubs were strongly
against the decision made by UEFA to eliminate the second group stage for the season 2003/04.
Because in the second group stage usually it was when the top clubs would play each other more
often since the less expressive teams would probably have already been eliminated in the first group
stage. We can see this point by looking at the evolution of matches played among G-14 clubs from
1998/99 to 1999/00 when the second group stage was implemented. Although in 1999/00 G-14 clubs
represented only 38% of the participant teams in the competition, while in 1998/99 they represented
42%, the number of matches among them increased by 80% from 15 to 27, and those are the most
lucrative matches for the top clubs.
Of course it is clear that UEFA benefits from increasing the size of the pie, but it seems safe to
assume that the clubs have been the major drivers for most changes in the format of the UEFA
Champions League.
3.2.2. R EVENUE DISTRIBUTION
Much like the behaviour observed in any other league, UEFA is interested in maintaining the
competitive balance of its competitions. And it also draws on solidarity measures in the pursuit of that
objective.
In the foreword of UEFA’s brochure on the solidarity system at the UEFA Champions League we read:
‘The UEFA Champions League represents the pinnacle of club football in Europe. At this
level, there is no doubt that football becomes a commercial activity as well as a sport.
However, it is central to the UEFA philosophy that something should always be given back
from the top level, to help develop football from the ‘grass roots’ upwards.
The UEFA philosophy means that clubs from the small and less wealthy countries should
always have a chance to play against the biggest and the best. Thus, UEFA policy is
inclusive and not exclusive. True competition is about excitement and uncertainty and,
above all, the chance for the weak as well as the strong to follow their dreams.
For these reasons, the UEFA Champions League is founded upon a clear principle of
financial solidarity.’
We have seen that UEFA relies mainly on the organisation of the UEFA Champions League and the
Euro to fund its activities. Part of the income generated by the two competitions is redistributed among
participating clubs, national associations and leagues and part is retained by UEFA for projects in the
development of Football.
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And here is where the main conflict arises. Both the Euro and the UCL rely heavily on the resources of
top clubs. The presence of the top clubs and all their superstar players in the UCL is what makes most
of the commercial value of the competition. A competition without any G-14 member club would have
a small fraction of its current appeal to sponsors and TV companies. Along the same line, the national
teams participating in the Euro are composed by a large number of players whose employment
contracts belong to G-14 member clubs. Nevertheless, the clubs are not among the group of
beneficiaries from the revenue sharing scheme of the Euro. This explains why there has been
constant pressure from the top clubs to make changes in the way the revenue from UEFA’s
competitions have been distributed. Those pressures are directed towards both competitions.
In the case of the Euro, Thomas Kurth general manager of the G-14, defines the problem in the
following way:
‘The clubs are not against supplying players to the national teams within certain limits,
because it is the right of the players to defend the colours of their countries. But we
believe that the clubs should share in the revenue distribution scheme of the national team
competitions. It is not fair that those who assume the material responsibility for the players
while they are away, playing for their countries, are get nothing. We are convinced that
this will change very soon. Either because Governing Bodies will get convinced that it is
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nothing but fair, or because they will be obliged to do so.’
With regards to the UEFA’s revenue distribution system for the UCL, the clubs have pressured for
changes in two ways, firstly by getting a higher share of the income generated by the competition, and
secondly by challenging successfully the way in which media rights of the competition are sold.
Regarding the increase in the share of the competitions revenues, Figure 3.5 shows how UEFA has
responded to the pressure of the clubs for a higher share of the revenues over the last years.
Figure 3.5 – Evolution of the distribution of UCL’s income – CHF million

(Net of organisational costs)
1000
900 879
835
800
708
700
600
500 88%
Key:
88%
400 87%
Participating clubs
300 254
Others*
200
81%
100
19% 13% 12% 12%
0
98/99 99/00 00/01 01/02
G-14 / Total Participating Clubs 42% 38% 38% 38%
Income share of G-14 clubs / Total Clubs 54% 54% 55% 53%
* Others include National Leagues, National Associations and Eliminated teams in the qualifying rounds
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Although it is correct to affirm that the amount distributed to other parties has increased in absolute
terms from 1998/99 to 2001/02, it is clear that the slicing of the pie has changed and that the clubs are
pocketing most of the incremental revenues from one season to the other. And this comes as a result
of the pressure from the top clubs.
This trend tends to be further accentuated in the season 2003/04 as UEFA decided to revamp the
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format of the competition reducing the number of matches played. According to the press, UEFA
was considering examining the possibility of remodelling the competition revenue sharing system to
increase the participation of the 32 competing teams in the slicing of the pie. This is a move designed
to address larger clubs’ demands for increased revenues, since the new format of the competition will
see a reduction in the number of matches played by each club, as we have shown before. Thus,
although the size of the pie is expected to decrease, the absolute value for the clubs will probably be
kept constant, proportionally increasing their share even further, which means that the trend verified in
the last four seasons in decreasing the absolute values redistributed to other stakeholders of
European football, as described in section 2.1.6, will be maintained.
Regarding the way in which the UCL media rights are supposed to be sold, as mentioned before,
clubs have gained from the European Commission, the co-ownership of the championship media
rights. Although this situation is far from being settled, in practice it means that clubs already have the
right to individually sell the rights over delayed club games to be sold on a non-exclusive games,
archives, DVDs, audio of live games on internet, among others. This will give to the clubs a direct
control over part of the value of the championship, without having to go through revenue sharing
systems.
3.2.3. OTHER A REAS OF CONFLICT
Club Football vs. National team Football
One of the recent and hottest topics for discussion in G-14’s agenda has been the release of players
for national team matches in terms of frequency and, in some cases, compensation for the clubs that
pay the players’ salaries and insurance costs. This issue has become particularly controversial in the
months previous to the organisation of the Confederations Cup in France in June 2003, for which
clubs have asked FIFA to be more flexible on its rules for players’ availability or even to cancel the
tournament.
Thomas Kurth expressed his concerns for the release of players in three different situations: friendly
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matches, qualification rounds and final stages. In the case of friendly matches, Kurth mentions that
clubs are strongly against “meaningless” exhibition matches with solely commercial purposes for
which players in European clubs have to travel long distances risking their health and where clubs do
not receive any compensation. In this respect, clubs would like the number of dates for friendly
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Champions League Clubs to Double their Money in 2003-04? – Sportcal – 22/07/02
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matches to be reduced to two in a year. In relation to qualification matches, Kurth establishes that it
is “nothing but fair” that players participate in these matches defending their national colours and in
this particular case clubs do not demand compensation but call for modifications on the format for
qualification competitions in order to reduce the number of matches. However, in relation to the final
stages that are marketed by FIFA for the World Cup and by UEFA for the Euro, Kurth believes that,
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taking into consideration that players have to be released for longer periods, clubs should share in
the revenue distribution since they are the ones assuming the material responsibility of the players.
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On this issue, Jérôme Champagne mentioned that “more or less the problems are being solved.”
For example, now the World Cup qualifiers for Africa are also qualifiers for the African Nations Cup. In
the case of Conmebol, the qualifications for the World Cup will be played with 7 double rounds in order
to reduce the number of trips from players of European clubs to South America. Also in terms of
friendly matches, Conmebol has accepted not to call players in Europe for friendly matches outside of
Europe. According to Champagne, FIFA is making this work in order to keep a balance between clubs
and national teams. In response to the demands of clubs in relation to the organisation of the
Confederations Cup, Joseph Blatter, president of FIFA, mentioned that the dates for the competition fit
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with the harmonized international calendar agreed upon in August 2000 and that the clubs’
argument of players having to play too many matches was undermined by organisation by clubs of
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summer tours to Asia and North America to expand their global reach. Even though there seem to
be different opinions even within FIFA as became evident by the declarations of Michel Platini, head of
FIFA’s Technical Committee, on the cancellation of future editions of the Confederations Cup, the
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competition will most likely be maintained. For FIFA national team football is still one of the
foundations of the sport. Jérôme Champagne stressed on this point:
‘National team football is fundamental because be it in France or in England the national

team gathers more people in front of TV than any other club can do. Besides, national
team football has a greater marketing potential since among the group of spectators there
are a greater variety of people: men, women, old, young people. National team football
unifies while club football divides.’173
Transfer Rules
Some clubs from England’s Football League have also recently contested FIFA’s new transfer rules
that restrict the buying and selling of players to two windows, one in June and July and a second one
in January. Clubs argue that these rules limit the ability of clubs to solve their financial troubles by
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In response to the clubs demands a date for friendly games in April was eliminated.
168
Up to 6 weeks depending on the competition and how far the team goes in the competition.
169
Interview with Jérôme CHAMPAGNE
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Though the International Harmonised Calendar (ICH) was approved at this time, the clubs were not represented directly at
the time and in result may not be congruous to the ICH.
171
On G-14’s website, “Clubs to share in power” 30 March 2003, G-14 affirmed its stance against the FIFA Confederations Cup.
172
In a related article, Platini makes controversial Champions League proposal, Sportcal, April 14, 2003, it is mentioned that
FIFA distance itself from Platini’s declarations on the scrap of the Confederations Cup as a trade-off for the World Club
Championship. It is also mentioned that Joseph Blatter would rather see the Confederations Cup taking place every four year
instead of biannually.
173
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selling players. For instance, Leeds United was impacted by these regulations when it was not able
to sell its players when it faced financial difficulties last year and was then forced to do a fire sale
during the transfer window last January. Chelsea’s chairman Ken Bates has expressed his opposition
to these rules arguing that “small clubs need to be able to sell in the middle of the season to survi ve.”
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UEFA may react by offering small clubs a concession to transfer players in critical cases.
The UEFA Club Licensing System
Finally, one of the issues that according to Antonio Marchesi will generate tension and be potential
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source of conflict in the near future would be the adoption of UEFA’s Club Licensing System.
UEFA’s Club Licensing System came as a result of the conclusions of a task force set up by UEFA in
1999 to examine the possibility of licensing clubs, imposing salary caps and stopping teams from
falling massively into debt. When UEFA first launched the idea of a salary cap in an attempt to control
the increase in players’ wages and foster a more balanced competition, the top clubs expressed their
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opposition seeing it as an interference of UEFA on they way top clubs manage their spending. Not
much later the clubs embraced this initiative seeing it as a way to improve their finances and even
nowadays is still one of G-14’s most urgent initiatives. However, it is needless to say that such a
mechanism of wages’ control would be highly scrutinized by the European Commission on the ground
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of a potential breach of competition law.
On the other hand, UEFA’s task force concluded that a salary cap would be a complex issue and that
it would be very difficult to construct without a licensing system in place. UEFA then gave the green
light for the implementation of the Club Licensing System in the 2004/2005 season.
Although UEFA will face some resistance to implement the Club Licensing System, the general
perception is that, at the end, it will be beneficial for European football. Arnaud Rouger expresses his
point of view as a representative of the French football league:
I believe that UEFA will face some difficulties to implement the program. But I think the
program is good because it is a way to equalize participants at European competitions.
French clubs have always complained about their lack of competitiveness at the European
level. When we see Real Madrid and the way they manage their club with very little
restrictions while French clubs are subject to strict management control by the DNCG, the
French clubs have some legitimacy in saying they are not able to compete with the same
tools as clubs in Spain for example.”
3.2.4. R EPRESENTATION
174
Mawhinney urges transfer changes , Nationwide.co.uk – Football Matters, 7 July 2003
175
UEFA threatens indebted clubs with Champions League bar, Sportcal, February 18, 2003
176
177
UEFA tells EU; A salary cap will guarantee equality, Sportcal, April 19, 2002.
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G-14 soccer clubs in favour of a salary caps, Sportcal, May 16, 2002.
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Even though, as we have seen, there are several issues on the relationship between top clubs and
UEFA, the main concern of clubs and specially G-14 and the one that seems to be in the background
of all discussions, is the recognition and representation of clubs in the decision-making of UEFA. The
perception of clubs about a lack of representation was accentuated by the way UEFA decided at the
last-minute to modify the Champions League in July 2002. Kurth explains:
‘In December 2001, the UEFA Executive Committee had announced that it would maintain
the format of the UCL until 2006. During a workshop in February, the vast majority of the
clubs present reaffirmed their preference for the system that has been in place since
1999). And now the UEFA ExCo, has decided on their own to reform the UCL without
consulting anyone. G-14 does not want an open conflict with UEFA. It does, however,
demand to be heard.179’
But is it true that clubs have no representation? According to Jérôme Champagne, clubs are in a way
represented in the traditional pyramidal structure of football through their national associations:
‘For instance when there are discussions at FIFA or UEFA about club issues such as
transfer rule, the presidents of each federation which, it cannot be forgotten, are elected
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by the clubs of their own countries, are there to represent the interest of the clubs.’
While recognising that it is unavoidable to give more spaces for discussion and participation to other
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stakeholders driven by changes in our societies, Champagne establishes that there is also an
informal representation through the people involved in the main bodies of FIFA and UEFA:
‘Within the Governing Bodies there are some people wearing several different hats, for
example, Franz Beckenbauer is the President of Bayern München, is a former national
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team player and is also present in the decision spheres of FIFA. I can assure you that
interests of clubs and players are being protected. When Platini speaks at UEFA or
FIFA183 he also speaks with his experience of former national team player.’184
In addition, Marco Brunelli states that clubs are being represented through their national leagues
whose role is to be the representative of the whole family of clubs and not the defender of small clubs
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and that integrate the Professional Football Committee of UEFA (UPFC). The UPFC as explained
before, has the responsibility for drawing up the bases for decisions and exchanging views in several
of the main issues previously discussed, including competition formats, solidarity system (i.e. revenue
sharing), release of players for national teams, transfer windows and club licensing system. The
committee may also have some decision-making powers by delegation of UEFA’s Chief Executive. At
the moment, the committee can establish the guidelines on the use of UEFA’s Champions League
money allocated to the leagues for the training of young players.
179
180
181
Champagne refers in particular to players, ref erees and clubs.
182
Beckenbauer is also the vice president of the German Football Association.
183
Platini is a member of both Executive Committees of FIFA and UEFA
184
185
Interview with Marco BRUNELLI
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Finally, there is the European Club Forum that, as we have previously discussed, was created by
UEFA in response to the demands of the top clubs and G-14 for greater participation and is meant to
support the Clubs Competitions Committee. Representatives from clubs member of G-14 and other
top clubs are represented in this forum and its board. The Club Forum’s four board officials are also
members in the Clubs Competitions Committee. According to Lars-Christer Olsson, UEFA’s future
CEO, UEFA has learned from conflicts in the past that they need to be more aware of the situation and
incorporate the clubs and leagues in the decision making process. He also expresses that the
European Club Forum is an example of this and that although it has been in existence for only one
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year, it has the potential of satisfying the clubs’ interests and their needs for representation.
But if there are all these platforms for communication and representation, why are the top clubs still
not feeling heard? In general, one of the reasons top clubs are not satisfied is because these formal
bodies of representation are mainly consultative and do not have decision-making powers. But, in the
particular case of European Club Forum, Thomas Kurth states that this is not the only reason:
‘The European Club Forum is formed by 102 clubs. You have one from Faeroe Islands,
one from Iceland, one from Armenia, one from Kazakhstan. I understand that since UEFA
is the confederation of all the national associations they have to do this. But by having to
obey to certain principles they weaken their own organs. Because in such a circle what
can you expect to come up? There are 102 clubs with different agendas, different needs,
different realities, and that will never produce anything fundamentally positive.”187
We may say there is a logical bias on this statement, but it seems other people think the same. For
instance, Antonio Marchesi believes that the Club Forum (or even G-14) will not solve the conflict or
will be even able to implement their common initiatives (salary cap, for example) because there will
always be competition between the clubs while establishing that in order to have participation in the
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decision-making clubs need to prove first cohesiveness in all fronts.
Representation of clubs through the pyramidal structure does not seem to be effective in today’s
reality either. One of the reasons is that both national associations and national leagues by definition
have a national dimension and must prioritise the national level first. On the other hand, top clubs
have transcended their borders and revenues from international competitions or global exposure are
becoming more and more important. Another aspect is that national associations and in some extent
leagues have several stakeholders and have to find an adequate balance in their representation often
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leaving the interests of top clubs on the side. Finally, national associations and leagues are political
organisations with internal power struggles and, in most cases, not very institutionalised. In this
respect, Michel Guénaire suggests that clubs need to become more institutionalised and so do these
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bodies. In relation to the leagues, Arnaud Rouger comments that the members of the league’s
186
187
188
189
In France, for instance, the league is composed not only of clubs but also of representatives of players’ unions, referees,
medical experts and independent members.
190
Interview with Michel GUÉNAIRE
81
executive body have often a difficult time to detach themselves from their clubs or personal
191
situation.
With the current structures being only consultative and not able to effectively represent their interests
is not surprising the top clubs feel their voice is not being heard and keep insisting in exercising
pressure through a lobby group such as G-14 in order to pursue their objectives. This is why the main
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current objective of clubs is to have “a voice in the game and a word in its management.” To
address this issue, G-14 presented a proposal for a new structure that suggests the creation of a
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specific body within UEFA’s structure that would govern European club competitions with UEFA and
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clubs working together. Thomas Kurth confirmed that the idea would be to replicate the same
structures we are seeing at national levels:
“Ideally, it will be under the umbrella of UEFA. It will mirror the situation at the national
level. In England you have the FA but you also have the Premier League, and the Premier
League is in charge of running the club game at the highest level. And you have the
Football League which is running the second division, Division 1. And in Germany you
have the DFB and you have the DFL,195 and in France and Italy the same. So I could
imagine that at an international level, the same structure could make sense as well.”196
The proposal, however, does not specify how exactly this body would be composed to take into
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consideration the variations in terms of the clubs participating in the competitions or how it will
interact with UEFA to assure an adequate balance between national and international football and
between national team football and club football. This proposal will most likely face resistance from
UEFA that intends to keep a strong hold on the game and would be reluctant to implement a project
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coming from an external body such as G-14 that according to some lacks of real legitimacy.
3.3. SCENARIOS OF POTENTIAL DEVELOPMENTS OF T HE CONFLICTS
Michael Porter defines scenario as an internally consistent view of what the future might be, not a
forecast but one possible future outcome. The task of planning scenarios in the sporting context is
relatively complex. Sport is part of culture, and one of the most interesting analyses of culture in
political sociology focuses on culture’s retarding nature, on its “stickiness” particularly in relation to the
perceived innovative impulses of the economy and the allegedly progressive tendencies of
technology. The contemporary literature on globalisation picks up this discrepancy between a rapidly
191
192
Interview with Genevieve BERTI
193
Berti refers to this body as a “board of clubs” or “body -league”.
194
Press release of Barcelona meeting on May 15, 2003.
195
Deutsche Fussball Bund and Deutsche Fussball League, respectively.
196
197
In a national level leagues such as the Premier League have a more or less stable composition that varies only in terms of
the clubs that are being promoted and relegated.
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For instance, one of our interviewed experts refers to G-14 as “a group of rich that is trying to extract itself from everyday
football (“le football profond”), from the real football, the domestic football, which is disparaging and something to be criticized.”
Another of our interviewed expert says “we cannot accept that G-14 represents the clubs. G-14 represents 18 clubs, not even a
league of a country and even inside the 18 G-14 clubs there are differences.”
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developing “global” technology and a persistence of a local culture, often enhanced precisely in
reaction to the globalising tendencies of technology and the economy. Social structures, types and
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attitudes are coins that do not readily melt. Once they are formed they persist for a long time.
Football has been Europeans’ favourite sporting “pastime” since the early 1900s, and its popularity is
being diligently built for generations and generations. In simple terms, this means that it will take a
long time for football to permanently feel the consequences of any mistaken decisions made today.
This, from on one side, makes it more difficult to design scenarios for European football based on the
conflicts we are seeing today, because we have to think in a very long term. From the other side it
gives to some of the more unadvised actors in the production of European football the dangerous
feeling of comfort, that everything is well, because the symptoms that something is wrong usually will
only appear when it is too late.
But although it is tricky to try to foresee the future outcomes for the conflicts between G-14 and UEFA
it is always a useful exercise in the sense that it stimulates debate about choices on future movements
and helps to develop strategies resilient against a broad range of futures.
We will build scenarios in two main areas of conflict intrinsically connected with each other
competition format and revenue sharing. The first is a proxy for the size of the pie, and the second
represents the slicing.
3.3.1. THE “C OLD W AR” OF EUROPEAN FOOTBALL
Before we enter into the design of the scenarios, it may be interesting to understand their delimitations
and boundaries. Both UEFA and the top clubs have shown their teeth and presented their final
weapons of mass destruction in a way that resembles the relationship between the USA and the
USSR in the apices of the cold war. Both possessed nuclear weapons with sufficient strength to
annihilate the enemy at the push of one button. But neither one ever intended to actually use that
power since using it would also represent their own destruction. But the simple fact of letting each
other know that they could use their power if the situation reached a certain limit was enough to
generate respect and bring the parties closer to a compromise.
In the first corner we have the G-14 with the ultimate weapon of the breakaway league. In the opposite
corner we have UEFA with the ultimate weapon of sending the clubs out of orbit to an unknown planet
outside the traditional structures of the Football Family. The breakaway league would hurt UEFA by
leaving it without its main source of funds for the development of European football, but it would also
theoretically hurt the top clubs by leaving them without the fundamental daily bread of the domestic
activity. But it is all a matter of opportunity cost for the clubs. Depending on how hard UEFA imposes
its conditions down to the clubs, they may realise that the options outside the official structure may
compensate for the losses they might face by leaving the official structure. And the clubs have an
extra advantage. At this point, no one can affirm for sure that even in the event of a breakaway
movement from the part of the clubs, UEFA would be allowed by the competent authorities to make
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MARKOVITS & HELLERMAN, Offside – Soccer and American Exceptionalism, Princeton University Press, 2001, p.14
83
use of its weapons to its full extent. In that sense, some lessons can be learned from the failure of
FIBA, the International Basketball Federation, to impose sanctions on clubs, players and officials for
participating in the Euroleague, a breakaway league outside the official structures. In a meeting of
Euroleague’s representatives with members of the European Community Parliament, the later
expressed that “any obstacles to establish the Euroleague would threaten the law and the community
spirit.”
As explained by one of our interviewees with a large knowledge in the EU procedures:
‘In the case of a breakaway movement, the EU would have to analyse if there are
economic interests involved, to make sure the case falls under its jurisdiction. If it does,
the EU will first analyse whether the new competition fulfils the requirements of
competition law, if it follows the rules. Secondly the EU will analyse the proportionality of
the retorting measures taken by the governing body. What kind of measures are being
taken and if they are appropriate and proportional. It is a matter of common sense.’200
So UEFA cannot act in a despot way because if that limit is reached, as mentioned before, UEFA
risks losing its main source of income.
In fact, UEFA seems to show that it understands well the situation. When the first threat of a
breakaway league appeared in 1998, idealised by the Italian media group Media Partners, where top
clubs would play in a super league with a foreseen €3.2 billion to be distributed among them backed
201
by a guarantee from J.P. Morgan, besides showing its weapons and threatening clubs with
expulsion from the system, UEFA took swift action and reformulated its Champions League for the
following season, 1999/2000, expanding it to 32 teams and creating the two group stages. We have
shown the financial effect such a move had in the finances of the clubs. From a total of CHF 206
million (~€140 m) in 1998/99, the clubs shared a total of CHF 616 m (~€410 m) in 1999/00, an
202
increase of almost 200% from one season to the other, immediately raising the switching cost for
the clubs. If we add to that figure, the fact that an European Super League would certainly cannibalise
203
some of the value generated by the domestic leagues, currently estimated in € 6.6 billion, we will
conclude that with that move, UEFA decreased by a large extent the attractiveness of the breakaway
league for the clubs.
Two reasons lead us to conclude that a breakaway league would cannibalise value from the domestic
204
leagues. The first is linked with calendar issues. A league between top clubs would mean that the
top clubs would play a larger number of matches in the European scenario, necessarily having to
reduce their participation in the domestic leagues. A domestic league with reduced participation of the
top clubs would lose part of its attractiveness to the media, consequently losing value. The second
reason is linked with investment limitations. If broadcasters would be willing to pay €3.2 billion for a
200
Our source asked to remain undisclosed
201
Interview with Rodolfo Hecht, Media Partners CEO.
202
See Figure 3.5, p.76
203
204
Refer to Figure 1.7, p.26
84
European Super League, they would have to divest some of the money they are currently spending in
the domestic leagues. It is a natural trade-off.
A league outside the traditional governance structures would face other collateral damages such as
the end of a unified international transfer system, as explained by Freddy Rumo:
Clubs need to make transfers and protect their assets. If Zidane who costs over a CHF
100 million to Real Madrid is not protected by an international system of transfer anymore,
a club like Neuchâtel Xamax could go tomorrow and take Zidane away! What authority
would this league have over me? ‘‘205
Finally, against the idea of a breakaway league, there is the strong suspicion among industry
specialists whether a closed-league in the moulds of the American system would appeal to the
European fans.
Having analysed the limits and options of each actor we will now go on with the design of the
scenarios for competition and revenue sharing.
3.3.2. COMPETITION
The issue of competition is a complex one because it deals with the limitation of the calendar. There is
a fixed number of matches that a club can play every season even if we do not take into consideration
how much football the fans are willing to consume. Under this immutable constraint, if we consider that
the players need four weeks of vacations and four weeks of pre-season preparation, and if the year
has fifty two weeks, we end up with forty four weeks to allocate competitions. According to Johan
Cruyff, former leader of the “brilliant orange” the Dutch team that enchanted the world in 1974, a
professional athlete is capable of playing one and a half matches per week without compromising its
206
physical health. That gives us a limitation of 66 match dates per season to be divided among the
several competitions a player may be required to play. Currently in the top level, that means mainly the
domestic league, the domestic cup, the UCL and a national team competition. By looking at the
current calendar, we see that there is already an excessive number of match dates. The example of
England in the last season shows that a top player could be requested to play more than 80 matches
in a season: 38 in the Premier League, 10 in the FA Cup, 17 in the UCL, 7 in the World Cup, 8 in the
207
qualifications for the Euro, among others. And the result of this excessive number of matches is
already been seen in the rising number of injuries verified in top players during the last FIFA World
Cup where in 64 games there were more than 170 injuries, of which 27% in situations where no
208
physical contact occurred.
The top clubs will pressure UEFA and FIFA to reduce the number of national team competitions to free
space for friendly matches internationally in developing football markets with a great economic
potential such as Asia and the US. But the greatest focus of pressure against UEFA will be in the
205
Interview with Freddy Rumo
206
CRUYFF Johan, Mi piace il calcio ma non quello di oggi, Sonzogno Editore, 2002, p.84
207
208
www.fifa.com
85
sense of creating the conditions for the top teams play the top teams in Europe more often. We have
mentioned before that the latest change in the format of the UCL will most likely cause a reduction in
the number of such matches. UEFA may cede to the pressure and revert back the format of the UCL
but this might have negative consequences to the game as explained by Rodolfo Hecht from Media
Partners:
Even for hardcore fans, this is too much. They don’t have time to digest the result of one
game that another one is already played… It also forces the clubs to have rosters of
around 30 players, a crazy condition with all the financial difficulties that clubs are already
facing at the moment.209
The other alternative for UEFA is to rethink the eligibility system of its elite competition to guarantee
that there will be a higher number of matches played among top clubs. This remodelled eligibility
system would have to take two things in consideration. The first is the guarantee that it is built upon a
system of technical performance. We believe that a system based on the distribution of wild cards to
top clubs would compromise the long term demand for the sport in Europe. The second is that the
system should maintain a certain degree of inclusiveness to proportionate the chance of clubs coming
from outside the ‘big-five’ leagues to have a taste of European football at the highest level. There will
be one extra challenge to be overcome by the governing body in this scenario. In a championship
where there are a larger number of top teams playing, UEFA will face some pressure against the
redistribution of income generated by that championship to actors not directly involved in the
competition. If it cedes to the pressure, this will mean a further concentration of income with the top
clubs, diminishing UEFA’s funds to invest in development and solidarity. Apart from those points, we
see no harm in providing for the top clubs to play each other more often.
Another alternative would be for UEFA to work along with the National Leagues, to study the optimal
number of participants in a league and, if necessary, reducing it, freeing space in the calendar without
compromising the value of the domestic competition.
Whatever UEFA’s positioning, we believe that further changes in the format of European competitions
will still happen, since the current solution is not addressing legitimate interests of some major
stakeholders.
3.3.3. R EVENUE DISTRIBUTION
In sections 2.1.6 about UEFA’s finances and 3.2.2. about revenue sharing, we have shown a recent
trend of concentration of European competition income among the top clubs, and a decrease in the
values redistributed to other actors of European football to be used in development. If this trend
continues, we see two main potential risks for the game as a whole. The first one, as already
mentioned, is the increase in the imbalance of the domestic competitions, which in the long run, could
undermine the value of such competitions, eventually hurting the top clubs finances. In the current
situation, allowing Manchester United to build a team to win the Champions League and use this same
team to play the Premier league creates a situation similar to allowing Michael Schumacher to
86
compete both in Formula 3 and F1 using the same Ferrari. It is no surprise that in the last 11 years
Manchester United has dominated the Premier league winning 8 titles. Will that undermine the value of
the Premier League in the long run? It is hard to predict. There is a consensus over the idea that
competitive balance is one of the factors affecting demand for football, but not even sports economists
seem to agree on how much competitive balance alone weighs among the other factors influencing
demand for sport, Stefan Szymanski explains:
‘The problem in the literature has been this somewhat obsessive focus on uncertainty of
outcome. But the real evidence shows that uncertainty of outcome alone actually does not
matter that much in terms of demand. It is much more the demand for success and
demand for quality that matters, and that is why even though European soccer is so much
less balanced than American sports it is just as popular.”210
The other consequence of the reduction in solidarity at the European level is less evident, and it has to
do with the formation of players. After all, a large part of the big clubs’ popularity is owed to the players
composing their squad.
But we have seen that a large portion of the top clubs’ best players are formed in small clubs from
countries outside the traditional ‘big-five’. Top clubs also form their own stars, as it is the case with
Owen or Beckham formed at Liverpool and Manchester United respectively. And it is undeniable that
with their global reach they inspire many young boys in their early decisions to become footballers. But
how many players starting at the youth division of a club eventually make it to the top ranks? If we
take the example of Atalanta Calcio, an Italian Club with a long tradition in the formation of young
players, every year the club observes 20.000 kids. Thereof, 213 will join the entry level of the youth
divisions, and thereof only 3 will make it to a Serie A team every year. How many of those 3 players
will be the goose that lays the golden eggs for the clubs? The formation of top players is a nothing
more than a statistical equation. The larger the recruiting basis, the higher the chances of having
highly skilled players reaching the top ranks of club football. But maintaining that large basis has a
cost that many federations and small teams cannot bear without the solidarity money.
In the end of the day, we must not lose sight of what the real issue is. The real issue is that Football
needs redistribution of income to work on the levers of demand for the sport. What group takes
ownership of the process of redistribution is less relevant as long as the end results are being
achieved. As we mentioned before, we believe that governing bodies and leagues are in an advantage
position to carry out this task since they have a more holistic view of the game.
It seems that in addition to promoting its solidarity activities through beautifully designed glossy paper
brochures UEFA has to develop a system to show the tangible results and returns of the investments it
makes in the development of football in a more systematic way. Once all stakeholders clearly realise
their share in the benefits harvested from the solidarity investments the level of conflicts will decrease.
209
Interview with Rodolfo Hecht
210
Interview with Stefan Szymanski
87
4. CHAPTER FOUR: CONFLICT MANAGEMENT OUTSIDE EUROPEAN FOOTBALL
4.1. CASE STUDIES
The objective of this section is to look at some examples not necessarily linked to European Football
and analyse how conflicts between sports governing bodies and other stakeholders in the Sports
industry have been managed in the past. By analysing these cases we intend to draw some
conclusions to support us in the design of the final set of recommendations of this paper.
For each of those cases we will analyse the general context in which the conflict was brought up, the
positioning of the parties involved throughout the process, the process through which the final solution
was reached, and the impacts of the final outcome to the parties involved in the conflict.
The cases selected are the following:
Governing Protagonist
Case Sport
bodies stakeholder groups
“Clube dos Treze” in Brazil Brazilian Football CBF Football clubs
GPWC and Formula One Motor Sport FIA Engine Suppliers
The IOC Athletes Commission Olympic Movement IOC Athletes
The Professional Cycling Council International Cycling UCI Cycling teams
4.1.1. “CLUBE DOS TREZE” IN B RAZIL
Overall context
Brazil is a gigantic country, with a size comparable to the whole area controlled by UEFA, where
football is played in every corner. The way football is organised in Brazil is peculiar reflecting the
process through which the game was developed during the early 1900s. Brazil is a federative republic
formed by 26 states with huge social and economical differences among them. Football was
th
introduced in the country in the states of Sao Paulo and Rio de Janeiro in the beginning of the 20
century and its governance was initially structured locally with the creation of state football federations.
This situation gradually spread throughout the other states along the years and the result is that the
organisational pyramid of Football in Brazil mirrors the continental structure having an intermediate
body between the clubs and the national association. In Brazil, the national association is the CBF –
Confederação Brasileira de Futebol – which is actually a confederation of 26 state federations. Those
state federations are responsible for electing the president of the CBF and for running football in their
geographical areas. Another relevant aspect, characteristic of Brazilian football, is the fact that the
figure of a league organising competitions does not exist. Championships are organised and run by
the federations.
Historically, club competitions in Brazil were organised regionally within the states by the state
federations. Each local federation would organise its own championships with a number of
88
professional clubs varying from 18 to 26 from state to state. It was not until 1971 that a National
championship was created, but the long-rooted tradition of the state rivalries was too strong to be
scraped by a newly created national competition with no history. Hence the two competitions
coexisted. The state leagues would be played during the first semester, while the Brazilian
championship would be played during the second semester.
The conflict
211
In 1987, a movement called Clube dos Treze (the club of thirteen), initiated by 13 big clubs from 5
different states challenged the organisational structures of Brazilian Football. This movement was
212
officialised in the form of an association and comprised clubs with a national following intending to
breakaway from the official pyramidal structure of the CBF and organise their own competition. Among
the key drivers for the creation of this rebelling movement were the following facts that the rules of the
Brazilian competition of 1986 were changed to accommodate the wishes of some states federations to
213
include clubs that were not eligible to play the competition according to its regulations. The result
was a bloated championship that extended through the 1987 season, with 80 clubs from 22 states in a
confusing formula involving three group phases followed by a knockout of quarterfinals, semi-finals
and finals. Additionally, the attendance at football matches was declining over the years, and a
214
research about the public image of football showed that fan interest in the game was declining.
The Clube dos Treze threatened the CBF that if their demands were not attended, they would
organise their own competition in the 1987 season outside the official structures of the CBF. Those
demands included:
§ Creation of divisions in Brazilian Football
§ National championship in 1987 with only 13 clubs playing home and away in a simple league system
§ National championship in 1988 played in two divisions (Serie A and Serie B) with 16 clubs each
§ Creation of an arbitral council within the structure of the CBF with representatives of the clubs from the
top division
§ Reduction of the number of clubs in the state championships
§ The Grouping would assume responsibility of elaborating the calendar as of 1988.
CBF, while knowing that a championship without the members of the Clube dos Treze would be
inconceivable, did not comment on the group’s demands and showed its power by threatening that a
breakaway league would represent the expulsion of the participating clubs from the FIFA family,
meaning that they would have to give up playing international competitions, but most importantly, their
players would automatically be allowed to leave to any other bidding club in the world since the official
transfer system would not be applicable outside the FIFA environment.
211
Flamengo, São Paulo, Corinthians, Vasco, Palmeiras, Fluminense, Santos, Botafogo, Cruzeiro, Atlético Mineiro, Grêmio,
Internacional and Bahia.
212
According to Placar Magazine, in 1993 the 13 clubs together accumulated a supporter base of 104 million people in Brazil.
213
Since the state federations are the ones with voting power at the CBF the history of Brazilian club football is full of cases
involving exchange of favours between the national association and the state federations.
214
At that time, the Brazilian national team was coming from four successive frustrating performances at the FIFA World Cups,
and the research showed that for the first time in history the largest national sporting idol was not coming from football, it was
Ayrton Senna from Formula 1.
89
th
But the fans were increasingly showing their support for the breakaway idea and in July 14 1987
Carlos Miguel Aidar, president of the newly-formed Clube dos Treze went public to announce the
disaffiliation of the 13 clubs from CBF and the organisation of the new championship in September.
The Solution
From July to September, when the new league was supposed to start, CBF was hesitant in terms of
th
the actions it should take but on September 4 1987, representatives of the two bodies sat together
and decided that the championship would be organised within the governing body’s structure, with 16
clubs along the format desired by the Clube dos Treze.
The impacts of the solution
The movement initiated by the Clube dos Treze in 1987 was a milestone for the modernisation of the
game. The championship organised in that year had an immediate response from the public with the
215
average attendance in the stadiums going up by 56% in relation to the previous year. The marketing
concept organised by the group for the competitions also inaugurated the era of selling of broadcast
rights of sporting events in Brazil, as for the first time, Rede Globo, the largest TV company in Brazil,
paid to televise live a number of selected matches. And with TV also came the sponsors in a time
where not many teams had sufficient commercial appeal to reach the sponsorship market. Coca Cola
was the major sponsor of the event and of most of the teams involved in the competition.
Brazilian Football still has a long way to go in terms of professionalization of its management
structures, since it was not until 2003 that the conflicts between state and national championships
were able to be sorted out in a calendar format that apparently optimises the balance of the local
rivalries with the more commercially viable national championship. But the seeds of modernization of
the game were laid by the episode of 1987.
4.1.2. THE GPWC AND FORMULA ONE
Overall context
Formula One is the pinnacle of motor sports and arguably the most popular TV sport in the world with
216
5 billion aggregate viewers worldwide tuning into the 17 races held annually. The sport is governed
by FIA , the International Federation of Automobiles, a federation that governs all forms of motor sport
involving land vehicles with four or more wheels from Formula One to rallying or truck racing.
In the early 1970s Formula One was chaotic, rarely did all teams compete in every Grand Prix, prize
money ranged substantially and quality of the tracks was poor. Bernie Ecclestone, the then head of
the Brabham team, concluding that the F1 teams were being exploited by the race organisers
convinced other team owners to stop doing individual “appearance money” deals with race organisers.
It was the birth of FOCA (Formula One Constructors Association). With Ecclestone as its head, FOCA
guaranteed the race organisers that a field of 22 or more cars would show up for every race in
215
HELAL Ronaldo, Passes e Impasses , Vozes, 1997
216
Grand Prix, Grand Prizes, The Economist, 13 July 2000
90
exchange for increased prize money and improved facilities. The member teams of FOCA would
217
receive subsidies for travel expenses and a cut in the TV money. . The idea was a huge success
and by the early 1980s, FOCA was beginning to take over the promotion of some of the races as
circuit owners refused to pay the prices asked. It was a similar story with TV rights. With a united
group of teams behind him, Ecclestone took on FIA, which owned the TV rights of Formula One, in a
war arguing that those rights should be exploited directly by the teams. A compromise was reached in
1980 with the split of Formula One’s revenues between FIA and FOCA. It was agreed that FIA would
handle the rules and the sanctioning of the races while FOCA would run the business and the
commercial responsibilities. This arrangement was the basis for the first Concorde Agreement, the
secret agreement that governs Formula One until today and dictates a wide range of things, from the
distribution of TV money to the process of enacting rules into law. The practical outcome of the
Concorde Agreement was to make the whole sport more professional. For instance, the teams who
signed them guaranteed to turn up to each race. This in turn meant that broadcasters could rely on a
proper spectacle. Bernie Ecclestone, spotting the potential to bring more money into the sport, signed
218
a deal with the European Broadcasting Union (EBU) in 1982. Under the new deal European
broadcasters agreed to show every grand prix instead of the previous ad hoc coverage. This was a
turning-point for the teams’ finances.
As TV deals grew bigger during the 1980s, team owners became less willing to take the risk promoting
races and so Ecclestone established a company called Formula One Administration (FOA) to do it on
their behalf. By the early 1990s, with the increase in the popularity of the sport, FOA had grown into a
hugely profitable business, with stakes in diverse aspects of the business of Formula One. In 1995
Ecclestone, made a deal with FIA where FOA would secure the promotional rights of F1 for 15 years
in exchange for an agreed annual income for the governing body. The practical effect of this deal was
to replace FOCA by FOA in the grant of the commercial rights of the sport. It was the first step towards
the flotation of Ecclestone’s empire on the stock exchange. In 1996, in preparation for a flotation,
Ecclestone streamlined the various companies involved in Formula One and created a holding called
Formula One Holding Ltd. (FOH) to manage different aspects of the sport. Under this holding there
were companies looking after TV and new technology deals (F1 Communications), transportation of
the F1 circus (F1 World Travel and F1 Freight), a number of local companies which run individual
219
races, a trading company (Formula One Management) and FOA. As part of the restructuring
process, the ownership of FOH was transferred to SLEC Holdings, a company controlled by offshore
trusts belonging to Ecclestone’s wife. Soon, the F1 team owners, which, unwilling to deal with the
bureaucratic aspects of contracts negotiation, had practically given control of the sport to Ecclestone’s
empire, begun to realise that they had lost control of “their” sport. McLaren boss, Ron Denis for
220
instance, complained in 1997 that “there was too much money going out of the sport.”
217
The payout remains to this day : how teams place in the championship determines the cut.
218
The EBU is an umbrella organisation for public-service broadcasters in Europe.
219
Notably the Belgian, German and Hungarian Grand Prix.
220
How Bernie built his F1 fortune, Sportbusiness International, Issue 16, 01 December 1997
91
Under the conditions of the last Concorde agreement signed in 1997 with a duration of 10 years, the
teams were set to receive 47% of Formula One’s gross TV revenues, FIA would receive 30%, and the
last 23% would stay with SLEC. SLEC was also entitled to keep all the highly profitable fees paid by
promoters to stage grand prix and the income from trackside advertisement.
The conflict
221
In 2001, the German media group Kirch, secured US$ 1.6 billion in bank loans to acquire a 75% of
222
SLEC. Right after the purchase of the control in SLEC, Kirch Media announced plans of airing
223
Formula One races exclusively on its pay-TV system. Worried that the potential move would restrict
224
audiences, and dissatisfied with the current income distribution system set up by the latest
Concorde Agreement, a group of five carmakers – BMW, Fiat (Ferrari), Ford, Mercedes Benz and
Renault, major suppliers of engines to the main Formula One teams, joined forces and created a new
company: the GPWC (Grand Prix World Championship), with the aim of launching a breakaway series
to rival against Formula One starting in 2008. By then, Formula One Teams would be released of the
current contractual obligations undertaken by the signature of the last Concorde Agreement, and
would be free to form the new Grand Prix series. Luca di Montezemolo, president of the Formula One
team Ferrari explained the complaint of the manufacturers:
‘In no other sport are the teams deprived of a share of two of the three main revenue
streams – trackside advertisement and ticket sales – while having to share just 47 % of
the gross income from TV rights. We would like to reach a solution with Ecclestone. If not
it will be bad but it won’t be a tragedy.’’ 225
Since then, the GPWC has been approaching the Formula One Teams with the intention to allure their
participation in the breakaway series. The GPWC is understood to be offering an increase in the share
of TV revenue paid to the teams from 47% to 75%, and to additionally share 50% of the pre-tax profits
from the championship among competing teams. The breakaway group has also controversially
offered a one-off payment of US$ 50 million to the Ferrari team to join the GPWC series, as the
participation of the Italian marque is considered crucial to its chances of success, given the large
226
allegiance of fans and admirers of that team. Sponsors would be bound to follow the winning teams
if they switched to a new series, and that would probably mean the end of Formula One.
The solution
Up to now, the case has not reached a final solution. By early April 2003, principals of the ten Formula
One teams met with GPWC to sign a memorandum agreeing to develop a commercial structure for the
new championship, scheduled to start in 2008. Aware of its vulnerability, SLEC retreated and offered
to open negotiations with manufacturers to update the terms of the Concorde Agreement to favour the
221
Formula One : So far no checkered flag, Business Week, 3 June 2002
222
This majority shareholding was subsequently transferred to three creditor banks – Bayern LB, JP Morgan and Lehman
Brothers – following Kirch Media’s bankruptcy in 2002.
223
Formula One : So far no checkered flag, Business Week, 3 June 2002
224
Formula One’s main selling point to the car makers is the size of its global free-to-air audience.
225
Formula One’s Ferrari sets deadline for Ecclestone Negotiations, Sportcal, 14 May 2003
226
Ibid
92
teams and address the demands of the carmakers. According to Patrick Fauré, head of the Renault
Sport Motor Racing Team, the future of Formula One and the proposed breakaway series should be
settled by the end of August 2003. Fauré told news agency AFP:
‘I think we are in the last stage of our discussions or negotiations between us and the
banks and the trust. I really think by the end of August either we will have an agreement or
we will have the end of the negotiations.’227
The GPWC in its latest pres release also affirms that it continues serious discussions with SLEC to
achieve its objectives in a short-term time frame. In the words of Richard Parry-Jones, director of
GPWC:
‘It’s our intention to find a solution that benefits all parties. Therefore, GPWC is willing to
continue the discussions in 2003. If we do not come to an agreement at the end of this
year, we will focus all efforts in setting up the New Series. Experience has shown that if an
agreement is not reached within a certain timeframe it is better to focus on the
alternative.’228
Meanwhile, Max Mosley, president of FIA, has warned GPWC not to attempt to operate a rival series
without the governing body’s sanction. The FIA announced that it is prepared to authorise the new
series but if it follows the original proposal of being governed by a new independent federation,
manufacturers, drivers, and racetracks involved in the championship outside FIA jurisdiction would be
229
banned by the governing body from all other international motor sports.
4.1.3. THE IOC ATHLETES ’ COMMISSION
Overall context
Unlike most of the other cases presented in this chapter, the idea of the creation of the International
Olympic Committee (IOC) Athletes’ Commission did not arise from an evident conflict between
stakeholders. On the contrary, by proactively making the decision of involving athletes in its decision
making process, the IOC might have avoided a series of potential conflicts.
In 1978, the president of the GAISF (General Assembly of International Sporting Federations) decided
it would be very interesting to consider the point of view athletes in the decisions of the body and
started inviting some athletes to take part at the assembly. The concept built on and the then IOC
President Juan Antonio Samaranch decided to officially create an athletes’ commission on October
27th 1981. The commission was intended to build a bridge between the active Olympic athletes and
IOC. At that time, athletes represented in the commission would be appointed by the president.
The Conflict
As mentioned before, the decision of creating the commission did not arise from an apparent conflict
between the athletes and the Olympic movement. Dennis Oswald, member of the Executive Board of
227
Renault Boss : Formula 1 future to be settled by end of summer, Sportcal, 30 May 2003
228
GPWC Press Release, 17 July 2003
229
GPWC offers Formula 1 teams an extra €150 million a year, Sportcal, 25 April 2003
93
the IOC, and a former athlete and Olympic medallist explains that most of the time athletes were too
230
busy with their own career to care about anything else. They were therefore not organised. What if
they had been? According to Oswald, the story could have been completely different, but IOC avoided
this eventuality by creating the commission and choosing people such as Anita De Frantz or Thomas
Bach who are today leading figures of the IOC.
Yet this decision has risen the awareness of the athletes on a broad range of issues. Their better
knowledge of the IOC structure and mission and the fact that they finally had a common channel of
communication have lead them to address some new claims to the IOC.
The solution
To address those new claims, in the aftermath of the Salt Lake City scandal, the IOC launched a
grand reform, deciding among other measures, to incorporate one member of the athletes’
231
commission in the IOC Executive Committee.
Today, the majority of the athlete members of the commission are elected by their colleagues at every
Olympic games (summer and winter). All participants at the Olympic games are invited to vote.
232
Elected athletes automatically become IOC members and have an eight year mandate. Since
December 1999, the Commission is made of 19 members:
– 8 athletes from summer sports
– 4 athletes from winter sports
– 7 athletes chosen by the IOC president to insure a correct balance of the members in terms of
233
sex, sport and region.
Impacts of the solution
By being represented in all other IOC Commissions, the athletes have now a greater say in the
decisions made by the Executive body and can influence them sensibly. They have been able for
example to obtain the right for the commission to elect its own chairman, a right that normally would
rest with the president of the IOC. That decision was not an easy one according to Dennis Oswald
who acknowledged that the IOC is now dependent on the choice made by the athletes and problems
might arise when the members of the commission would elect a very controversial figure as a
chairman. However, Oswald recognises the usefulness of incorporating the view of athletes on the
daily issues faced by the IOC:
‘It allows the organisation to stay up-to-date with the needs of the people that are key
components of the product they are trying to sell.’234
230
Interview with Dennis OSWALD, IOC Member
231
This member is Sergei Bubka, the Ukrainian Pole Vault former champion.
232
Theoretically at least because the General Assembly of the IOC still has to confirm the choice of the Olympic athletes but
has never taken a different decision so far.
233
If the athletes were to elect all the members, the members of the athletes’ commission would then come essentially from the
big sporting nations and from the most popular sports.
234
Interview with Dennis OSWALD
94
On a longer term basis the athletes elected or appointed in the commission end up developing an
interest for the governance of sport. Once their term is over, they probably will get hired in different
sporting federations where they could use the experience acquired during their time at the IOC and
spread even more the influence of athletes.
4.1.4. THE P ROFESSIONAL CYCLING C OUNCIL
Overall context
235
Cycling is a sport governed at the international level by the International Cycling Union (UCI) . As an
international association headquartered in Switzerland, the UCI currently has 170 member national
federations.
The world of cycling represents seven disciplines, each of which has its own World Championship,
road cycling, track cycling, mountain bike, cyclo-cross, BMX, trials and indoor cycling.
Although cycling is an activity practiced by an incalculable number of people in a number of

disciplines, and although there are more than 600.000 licensed amateur riders around the world, the
only area of the sport that achieved a relevant level of commercialism is elite men road cycling, with
approximately 1200 professional riders. The world of elite men road cycling is highly concentrated in
236
Western Europe, a region that accounts for 78% of the professional riders in the world. Those
237
athletes compete in “trade teams” in traditional road competitions, among which the Tour de France
238
and the Giro D’Italia are the most renowned ones. Those competitions are organised by
independent entities such as the Société du Tour de France.
The conflict
Being an emanation of 170 national federations, UCI board is composed by members representing
those federations. Since professional cycling can be seen as a European concept, its peculiarities can
be very far from the reality known by the majority of those federations in their respective countries. It is
inevitable that while the heads of those federations lacked some of the required expertise in the field,
they had to make decisions on very specific and complex issues affecting professional cycling, such
as doping, eligibility to competitions, among others. At the same time, some of the major groups of
interest representing the pillars of professional cycle, namely the race organisers, the trade teams and
the riders were being left out of decisions affecting their day-to-day business. To address that, the UCI
had in its structure a consultative organ named Elite Cycling Commission integrating representatives
from those main interest groups.
The main trigger for change came when UCI suffered a first threat over the control of the professional
aspect of cycling. It came from IMG in 1997 in an attempt to trespass UCI and deal directly with the
trade teams, representing them in front of the race organisers. The threat was brought under control
235
Union Cycliste Internationale
236
Thereof approximately 70% come from Italy, Spain, France and Belgium.
237
Trade teams are named after their sponsors, such as Telekom, Once, Fassa Bortolo, among others.
95
by a direct intervention of the governing body but it was clear that it might come up again sooner or
later. “
The solution
In 1999 the UCI proactively decided to create the Professional Cycling Council (PCC). The idea of the
council was to involve all the major actors of professional cycling at the decision making level of the
UCI. The idea of the creation of the PCC took the stakeholders by surprise, who quickly bought into it.
The PCC is a board composed by twelve members, six of which are chosen by the UCI, besides two
delegates from the Association of Cycle Race Organisers (AIOCC), two delegates representing the
riders through the Association of Professional Cyclists (CPA) and two delegates representing trade
239
teams through the International Association of Professional Cycling groups(AIGCP). In case of split
decision, the casting vote belongs to the president of the PCC who is appointed by the UCI.
On a political level, the PCC President is a member of the UCI Management Committee and the UCI
President attends all PCC meetings. On the administrative side, the follow up of the issues dealt with
by the PCC is managed by the UCI Professional Cycling Department, which is fully integrated in the
UCI headquarters. The body meets three times a year and make decisions over issues such as
organisation and administration elite men road cycling races, production of regulations for professional
trade teams, design of the calendar for higher class races among others.
The decision to create the PCC did not face much resistance from the national federations although
for them it meant giving away some of their power. According to Alan Rumpf, professional cycling
manager of UCI the strong representation of the key national federations (France, Belgium, Spain and
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Italy) inside the PCC was probably a key aspect in how easily this step was taken.
Impacts of the solution
Alan Rumpf summarizes the outcome of the decision of the creation of the PCC:
“Involving the stakeholders at the highest level and letting them rule the professional
cycling world is a way to show them that there is no reason to leave the framework
created by UCI or to refuse participating in the UCI world championships whose
broadcasting rights are the essential funding means of the UCI.”241
238
The Tour de France is said to be the biggest annual TV sporting event in the world with over 1800 hours of TV transmission
in 165 countries.
239
The presidents of the AIOCC, CPA and AIGCP are automatically members of the PCC. The other delegate from each of
these associations is chosen by them.
240
Interview with Alan RUMPF, Manager of Professional Cycling, UCI
241
Ibid
96
4.2. GENERAL LESSONS LEAR NED
We have selected ten major lessons from the cases presented above. Those lessons are related to
the positioning of governing bodies in situations of conflict with stakeholders of their sports, and will be
useful in the formulation of our final recommendations. Some lessons are drawn from multiple cases,
others from a single case.
Lesson 1: Governing bodies are in the best position to promote balance among interests of
stakeholders and should not abstain from that responsibility.
One of the roles attributed to governing bodies is the role of regulator of the sport. As the regulators,
governing bodies are in a privileged position to oversee the interests of stakeholders and to promote
balance among them. The case of UCI subtly shows that. While IMG made a move to represent trade
teams in front of race organisers, UCI counteracted and created the PCC. While the move of IMG
would address the concerns of only a fragment of the sport, the PCC gathered all relevant parties
around the table being a much more effective solution to all stakeholders. Something that no individual
stakeholder, or external actor would be in position to do.
However sometimes, due to the power structure of the governing body, conflicts of interest may arise
as we have seen from the case of the Clube dos Treze and CBF. Since the state federations have a
strong representation at the CBF level, the confederation opted to privilege the interests of that
stakeholders’ group in detriment of the interest of the clubs, generating imbalance.
Finally, from the case of Formula One we have seen that when the governing body abstains from
promoting balance among stakeholders conflicts arise. FIA adopted a negligent position in determining
the way revenues would be shared among the actors involved in Formula One. Over the years, the
governing body practically withdrew from certain areas of the sport, delivering more and more power
to an intermediary body, SLEC, being contented in receiving a share of what the sport generated. FIA
was the best positioned body to realise that interests were unbalanced and should have acted
proactively to fix the situation before it was too late. In this case we do not intend to criticise the right
that the governing body has to delegate the administration of certain areas of the sport to other actors,
but the governing body should not abandon the role of regulator, guaranteeing that even in the areas
that have been delegated to other actors balance is being promoted.
Lesson 2: Significant conflicts of interest appear when there are significant amounts of money at
stake, and when it happens, revenue distribution is a major issue and it should be treated with
transparency, fairness and accountability.
It is interesting to notice that although the UCI governs a wide range of activities within cycling, the
only area where significant conflicts arose was within the discipline of road cycling, the one discipline
that achieved a relevant degree of commercialism. The case of Formula One confirms that. It was not
until Formula One achieved a high level of commercialism evidenced by the interest of the media, that
new groups of interests, such as the large carmakers, were attracted to the sport creating the set for
97
the conflict. During the 1970s and 1980s, while the sport was growing, the teams did not have major
complaints against the peculiar administrative practices of Bernie Ecclestone.
The case of Formula One also shows that revenue distribution is a major issue in the modern reality of
commercialised sports. Stakeholders will usually agree that given the peculiarities already stressed
along this paper, revenue sharing is an important tool in the development of the sport. But when
revenue sharing is not producing the expected results the ground reason for keeping it disappear.
When Ron Dennis, the head of the McLaren team, complained in 1997 that there was too much
money going out of the sport, he showed a first sign of suspicion that the revenue sharing system in
place was not reverting in benefits for all participants. The beneficiaries of revenue sharing schemes in
sports have to be accountable showing that the use they are making from their shares in the scheme
is actually bringing direct or indirect benefits to all stakeholders, otherwise the whole system collapses.
Transparency is also a key concept. The secrecy around the terms of the Concorde agreement in
Formula One is not helping to promote trust among all stakeholders involved.
Lesson 3:Involvement of key stakeholders in the decision making process diminishes conflicts and can
actually be beneficiary to the sport.
The Clube dos Treze ultimately were heard by the CBF and in consequence the situation of Brazilian
club football has turned up with the seeds being laid for a commercially viable league.
The case of professional cycling shows that since the PCC has been created, no major conflicts have
plagued the sport. The PCC has the merit of gathering together at the decision making level the main
groups of interests with stakes in the sport. When an issue arises it is discussed among the members
of the PCC and all points of views are heard and confronted with each other. The final agreement is a
common agreement reflecting the group’s view of what is best for the sport. When a decision is
reached, it is the decision of the group, and individual stakeholders will be more willing to compromise
and make it happen since they share the ownership of the decision. The case shows that when
stakeholders are involved at the decision making level, they actually share the ownership of the sport
around one common interest, to promote and develop “their” sport.
Lesson 4: Proactive action in involving key stakeholders in the decision making process strengthens
the position of the governing body.
This fourth lesson is more subtle and builds on the last one. Not only involving key stakeholders at the
decision making level diminishes conflicts as we have seen from the third lesson, but a proactive
action of the governing body in doing so actually reinforces the role of the governing body as the
supreme institution in the organisation of the sport. Since the decision of creating the PCC was
initiated by the UCI in a will of sharing the power in ruling the sport, the stakeholders quickly bought
into the idea, showing no resistance to the terms proposed by the UCI. The committee was created
within a positive and cooperative atmosphere, which would probably not be the case if it had been
created as the result of a long-time animosity between the stakeholders and the governing body. By
accepting the delegation of power coming from the governing body, the stakeholders are actually
accepting the ascendancy of the governing body over the sport, otherwise it would not have the
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legitimacy to share the power. It also strengthens the position of the governing body because since
the stakeholders now share the governance of the game, they will have no reason to leave the official
framework created by the governing body, as explained by Alan Rumpf from the UCI, so the governing
body is less susceptible to the threats of breakaway movements that often come from external groups
interested in exploiting short term commercial opportunities.
Lesson 5: By sharing the management of the game with other stakeholder groups, governing bodies
allow those groups to develop a more comprehensive and empathetic view of the governance of the
game, with positive results for the sport.
From the case of the IOC we have learned that the decision of creating an athletes’ commission has
risen the awareness of the athletes on a broad range of issues. In the long run those athletes end up
developing an interest for the governance of sport. Once their term is over, they get hired by different
sport federations where they use the experience acquired during their time at the IOC, which is
beneficial for the sport as a whole.
We can also infer that by having in the PCC, a common forum to discuss the management of cycling,
stakeholders have the opportunity to learn from and understand the points of views of other
stakeholders and consider them in the decision making process. Without this common forum
stakeholders would probably be to busy thinking exclusively on their own interests without considering
the impact their interests could have on the activity of other stakeholders.
Lesson 6: The fact that a determined stakeholder group is not sufficiently organised as a lobby group
to promote its interests is not a reason not to include this group in the decision making process.
In the case of the IOC, athletes did not have time to organise themselves into a group to voice their
interests, but this did not stop the IOC from addressing this group realizing their importance to the
Olympic Movement and ultimately incorporating them at the decision-making level, with positive
impacts for the sport, as we have seen.
Lesson 7: The perception that the management of the game is not being conducted at an optimal level
will eventually lead to the appearance of breakaway movements.
The case of the Clube dos Treze in Brazil showed that there was general dissatisfaction with the way
the sport was being governed by the CBF. This was reflected in the evident plunge in the popularity of
football, the plummeting average of spectators in stadiums among others. The organisation of
competition was chaotic, and Brazilian club football was light years behind the situation in other
countries as far as the commercial potential of the game was concerned. Thus the major clubs
decided that change had to happen with or without the CBF.
The case of Formula One reinforces that message. FIA adopted an extremely hands-off approach in
the governing of the sport leading to anomalies within the structure. This raised the opportunity for a
new group to be formed and easily sell the idea of a breakaway movement to the F1 teams.
Lesson 8: Governing bodies should not underestimate the importance of the fans in the process of
managing conflicts.
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In the case of Clube dos Treze, the lobby group was concerned with not having a say in the
regulations of the championship. They threatened to leave the CBF’s umbrella. It was only a short
time before the threat was fulfilled that the CBF realised its legitimacy in the eyes of the fans and
reacted accordingly.
The case of Formula One shows the awareness of the GPWC about the importance of the fans in
giving legitimacy to the breakaway movement. They were willing to offer a special treatment to attract
the Ferrari team since they know that that is the team with the largest and most fanatic group of fans.
And if you have the fans, you have everything.
Lesson 9: Both lobby groups and governing bodies are sensitive to the complexity and potentially
negative impacts of breakaway movements for the sport and will usually reach conciliatory positions
through dialogue.
As mentioned before, given its peculiar characteristics, sports needs an internal regulator to
accommodate the interest of all stakeholders involved, and the best institution to assume the role of
regulator is the governing body. Neither the clubs in the case of Clube dos Treze nor the carmakers in
the case of Formula One have the expertise, the interest or the necessary impartiality to assume the
role of the regulator. Thus if the threat of a breakaway movement does follow suit it is very likely that
sooner or later a new governing body will be set up to assume the role of the regulator. From the other
side, governing bodies know that without the revenues generated by the elite teams, the ones
capturing the largest share of supporters they will not be able to successfully carry forward the task of
developing the sport. Thus it is generally in the best interest of both the lobby group and the governing
body to reach a compromise, being the breakaway the last resort. That is what we have seen from the
case of the Clube dos Treze and the CBF in Brazil. The case of Formula One has not yet come to an
end but all parties, including the GPWC, express their interest in reaching a compromise within the
official framework currently governing the sport.
Lesson 10: A reactive firm position from the Governing Body does not bring the Lobby Group/opposing
party closer to negotiation of a solution but rather pushes them away.
As we have seen from the cases of Clube dos Treze and Formula One both governing bodies have
threatened the lobby group with retaliatory measures usually meaning that the rebel group would be
banned from participating in any competitions or activities organised by the governing body on a wider
sense. However such retaliatory behaviour will usually not be effective in keeping the lobby group from
carrying on with the breakaway plans as the lobby group showed in both cases for two reasons. First,
because the breakaway is usually the last resort, the groups have already calculated the risks and
concluded that they will be better off facing the consequences than keeping the status quo. Or
secondly, because the groups know that they have good chances of successfully challenging the
retaliatory measures in the court of justice who will analyse the proportionality or lack thereof of the
retaliatory measures.
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5. SECTION FIVE : A POSSIBLE SOLUTION
Based on our analysis of the current challenges and scenarios facing UEFA and keeping in mind the
lessons learned from the examples of conflict management outside European football, we believe it is
time for UEFA to take the leadership and implement an unprecedented change in the way football is
governed.
In this chapter we will make a recommendation on what we view as a possible solution for the conflicts
afflicting European football, and we believe that solution has to consider the sharing of the decision
making power in professional football with the major stakeholders involved in the game. We strongly
believe that any other alternative not considering the involvement of stakeholders of professional
football in the decision making level would be palliative and would not tackle the roots of the problem,
leaving football to face the negative consequences presented in section 3.3.
5.1. STRUCTURAL PROPOSAL
5.1.1. CONVERGENCE OF K EY STAKEHOLDERS
In order to propose a successful model that can mitigate the current conflicts, we have to make a
critical step and identify the key actors relevant for a model concerning the new governance of football.
To do that we will make use of the stakeholders’ map originally presented in section 1.1.3 and
reproduced here as Figure 5.1.
Figure 5.1 – Stakeholders Map of the European Football Industry
Non
Non
Exhaustive
Exhaustive Fans /
Clubs
Spectators
Club
UEFA
Patrons
Stock
FIFA
Market
G-14 European Football Industry Media
European
Sponsors
Union
Players Press
National National
Leagues Associations
Stakeholders that should be involved at the decision making level
Looking at the stakeholders map we have identified four key stakeholders which, along with UEFA,
should be directly involved in the decision making of European professional football: The clubs with
special emphasis for the top clubs, the players, the National Associations and the National Leagues.
Why? We have shown in previous chapters the fundamental place that clubs have in football and that
101
they are the basis of football economically and socially. We insist in highlighting the top clubs within
this group because they are the ones holding the strongest link with the largest share of the supporter
base, and their interest as a group has to be taken into special consideration within the larger universe
of European clubs. The players represent the second major stakeholder. Without players there is no
club and therefore no spectators and ultimately no professional football industry. UEFA’s members,
the National Associations, are the firmament and cannot be ignored if we discuss the governance of
football, for it is these bodies which created UEFA because of the growing need for continental
governance structure. The National Leagues are the following group. These entities provide the stage
and organise the domestic competition which is the daily bread of the clubs.
We do believe that the opinion of other stakeholders such as the fans, FIFA, the EU, the media and
the sponsors is extremely important and has to be taken into consideration in the governance of
European football, but we believe that these opinions can be taken on a consultative basis, since the
core activity of these groups does not depend directly on European football. Lastly, as for the G-14 as
a Lobby Group, we believe that with the adoption of a model where clubs, and especially top clubs,
are sharing in the steering of professional football, the Grouping loses its “raison d’être” as a Lobby
Group and may continue its activities as a forum for the top clubs to share experiences in managerial
issues.
One last but crucial element for our model is that it stands on both pillars of football: club and national
team. Remembering that UEFA is currently integrating the subjects of decisions (the pillars) but not
the actors in their policy making, we would be missing the point by integrating the actors but then
separating the pillars, in essence dividing the House of European football. As we hope to present a
model capable of mitigating most potential conflicts to arise in the future, we aim to integrate both the
stakeholders and the issues within their decisions. Recognising this fact, but also acknowledging that
national team football is not in the scope of our topic we will incorporate this into our model in order to
achieve a united group of relevant stakeholders deciding about both of the key relevant issues, our
two pillars of European football.
5.1.2. THE P ROPOSED M ODEL – A N EXPANDED DIALOGUE
Our model will be built on the basis of providing a dialogue between relevant stakeholders and
balancing the power and interests between them. The guidelines used to build this were:
242
§ To work within the current structures
§ To represent stakeholders at decision-making levels

243
§ To anticipate future conflicts and provide proactive structure to address them
The current structure of UEFA’s governance of football and the current role of the stakeholders is
represented in the Figure below.
242
This was crucial because it is consistent with the goals of both UEFA and G-14.
243
This does not mean that we will anticipate the future problems, but offer a structure able to anticipate them.
102
Figure 5.2 – Current Governance Model of European Professional Football
FIFA EU
Sporting rules Economic

competition rules
UEFA
Nature of the Actors:
A Decision maker
• Supreme Controlling Organ
• Appoints the ExCo Congress National B Consultative
Associations
• Residual Power C Pressure
• Appoints CEO
• Appoints Committees ExCo
G-14 • Approves changes in
competition formats National
Leagues
• Manages UEFA
• Appoints and delegates CEO
Sponsors management to Directors
• Manages all matters related Professional Football Clubs

to professional football & Marketing Division
Press
Standing Committees
Other National Players

UCCC UPFC
Committees Teams
Media
Expert Panels
Media Other Players

ECF
Panel panels Panel
Figure 5.2 purposely omits some administrative divisions, standing committees and expert panels for
the sake of simplification. Although we have already talked briefly about the current governance model
of European football in section 2.1, we will make a quick explanation of some of the points shown in
Figure 5.2. UEFA is formed by the Congress, the Executive Committee (ExCo), the CEO and
Administrative divisions, the Standing Committees, the Expert Panels and the Ad Hoc Working
Groups. The Congress is the supreme controlling organ of UEFA and is formed by the 52 Member
National Associations. The Congress among other things appoints the President of UEFA and the
244
thirteen members of the ExCo. The members of the ExCo come from the national associations. The
ExCo has the residual power of UEFA, which means that it has the power to make decisions on all
245
matters which do not fall within the legal or statutory jurisdiction of the Congress or another Organ.
Among other things, it appoints the CEO, the Directors of divisions and approves the members of the
Standing Committees. The ExCo has also recently been involved in approving the new format of the
UEFA Champions League. The CEO is responsible among other things for the administration of
246
UEFA. There are seven divisions reporting to the CEO, among which the Professional Football &
Marketing Division (PF&M), responsible for product management of national team and club
competitions, professional league services, marketing among others. The CEO and the PF&M division
are advised by the standing committees and the expert panels. Among the standing committees we
have the Club Competitions Committee (UCCC), Professional Football Committee (UPFC) and the
244
UEFA Statutes, Art 21, Par 3
245
UEFA Statutes, Art 23, Par 1
103
247
National Teams Committee. Among the expert panels we find the European Club Forum (ECF)
248
whose board sits on the UCCC, the Players’ Panel, a panel formed by ex-players to advise on
matters such as players’ role in developing the game, further education of players among others.
There are also expert panels on Media, Marketing, TV and New Technologies, among others.
Our recommendation is to adjust the current model as proposed in Figure 5.3 below.
Figure 5.3 – Proposed Governance Model of European Professional Football
FIFA EU
Sporting rules Economic

competition rules
UEFA
Nature of the Actors:

Congress National National
A Decision maker Associations Leagues
B Consultative
ExCo
C Pressure Clubs
ew
w
Ne
N
CEO The European Pro

Football Council Players
Sponsors
Six Administrative
Divisions
PF&M Division
Press
Standing Expert
Committees Panels ECF
(8) (29)
Media
As shown in Figure 5.3, our recommendation is to include the National Leagues, Clubs and Players in
the decision making process of UEFA in what regards Professional football, through the creation of a
new body – the European Pro Football Council (Council). In the next section we will explain the
structure and objectives of the Council in more details.
Existing within UEFA the Council would accumulate the functions of the current UCCC, UPFC and
National Teams Committee, with the difference that it would have decision making powers. With the
creation of the Council, the current functions of those three committees would be incorporated by the
Council and that is the reason why we suggest that the number of standing committees should be
reduced from the current eleven to eight. Finally we would suggest that the Professional Football &
Marketing Division should report to its Director who in turn reports to the Council. Our reasoning for
separating this division is clear, it achieves nothing to create a Council responsible for professional
246
Refer to Figure 2.3, p.44
247
See an explanation of the role of these committees in section 2.1.7, p.50
248
See an explanation of the ECF in section 2.1.7, p.51
104
football but then delegate the operations and administration to a division that reports to another body
(in this case, to the Director and the CEO).
With regards to the expert panels, we suggest that the current panels should be maintained, and that
includes the European Club Forum, and the Players’ Panel.
5.1.3. THE EUROPEAN P ROFESSIONAL FOOTBALL COUNCIL
This new body would be created under the umbrella of UEFA and would report hierarchically to the
CEO and functionally to the ExCo. The purpose of the body is to represent all key relevant
stakeholders in professional football under UEFA and make all decisions within the scope of
professional club and national team football at the European level. This body will make all policy
decisions on format of European national team and club competitions, revenue sharing system,
transfer windows and the commercialisation of rights of the competitions. The Council will be the body
in control of the professional game, but will delegate the management of the game to the Professional
Football and Marketing Division.
The Council will also work to establish an open dialogue with the EU through UEFA’s Communications
and Public Affairs Liaison in Brussels.
249
The body includes 10 members which are elected for a four year term, as shown in Figure 5.4.
Figure 5.4 – The European Professional Football Council – Membership Structure
2 Members European Football 2 Members

European Club
• 1 for “Big-Five” Leagues Forum • Chairman
• 1 for others • Vice-chairman
Players
Panel 1 Member
UEFA European
Pro-Football
5 Members Council
FIFA 1 Observer
• CEO (casting vote)
• NA:EURO
• Other 3 NAs
Reviews and approves modifications on issues related to:
• Formats, regulations, preparation and monitoring of national tea m
competitions: EURO 2004 and U-21.
• Format, calendar, regulations and monitoring of club competitions:
Champions League, UEFA Cup and others.
• Other issues related to professional football: international calendar,
impact of new formats on domestic competitions, solidarity system (incl.
ownership of commercial rights), club licensing system, release of
players, etc.
In addition to the ten voting members one observer from FIFA will sit on the Council in order to bring
250
the global interests of the sport. The UEFA President will also sit on the Council as a non-voting
105
member unless there is a split vote at which point the President will cast the final vote. This allows for
the figurehead of European Football to be responsible for this vote and weigh all the interests of the
“European Football Family”. All decisions by the Council are to be made within the scope of
professional football and the UEFA ExCo reserves the right to veto any decision which is outside this
scope and harmful to football as a whole.
5.1.4. THE N EW EUROPEAN CLUB FORUM
We have previously explained UEFA’s creation of this body. We see this as a building block for the
new governance of professional football and therefore propose that this body remain and take on
more responsibility. How?
First we would see the ECF have one representative on each standing committee within UEFA. As a
minimum, the ECF should have a representative on selected committees which are of importance in
club matters, such as the medical committee or the stadium and security committee.
The current structure of the ECF will elect the members of the ECF Board for a term of four years. Of
the 11 members on the ECF board, 5 are elected by the clubs representing the leagues ranked 1-6 (L-
1), 3 from clubs in leagues 7-15 (L-2), 2 from clubs in leagues 16-26 (L-3) and one from clubs in the
leagues ranked 27-52 (L-4). The election structure is as indicated below.
-In Year One the ECF elects 3 members from L-1, 1 from L-2, 1 from L-3 and 1 from L-4
-In Year Three the ECF elects 2 members from L-1, 2 from L-2, 1 from L-3
In this way half the board changes every two years while maintaining continuity through the body. The
Board of the ECF elects the Chairman and the vice-Chairman for terms of four years. In the first
round, the vice-Chairman will be elected for two years only and then beginning in Year 3 for a term of
four years. These two members are the ECF’s representation at the Council. The Chairman of the
ECF Board is also the ECF’s representative at the Executive Committee (ExCo) of UEFA, though it
must be ratified by the ExCo.
The representation at the ExCo by the ECF Chairman would be accomplished in phases over the first
four year term: Observer, Special Adviser, Member, then Vice-President. This would be the process in
the first cycle to gradually introduce the change.
The ECF would act as a representative body when the UEFA Congress or FIFA Congress wishes the
position of European Professional Clubs. The voting in the ECF would be based on 1 vote per club so
as to best represent the spectrum of club interests. This body would act as a sort of union of football
clubs. Furthermore, this body would be the platform for clubs to exchange information, strategies and
dialogue as employers and sport companies.
249
We recognise that some work will have to be done to coordinate the terms of office of the members on the Council and the
bodies from which they are elected in order to have consistency but also to have a gradual change of half the council changing
every two years (to maintain continuity).
250
We have also discussed that as the professionalism of referees continues, this important stakeholder could be incorporated
into the Council in the future.
106
Finally, the ECF would act as a platform for clubs from different countries, market sizes, for example.
Currently the only grouping (aside from the current structure of ECF) that allows for inter-club dialogue
beyond national boundaries is the G-14. This new ECF would expand the forum for discussion
251
between clubs and allow clubs to host seminars on club-specific issues. This could have a potential
side benefit of bringing partnerships between clubs to improve their management, financial structures,
marketing strategies, infrastructure-stadium development or even technical issues. From the
perspective of the clubs and their stakeholders in G-14, this enhanced forum would bring clubs closer
together off the pitch in order to better the whole of club football on the pitch.
5.1.5. ADVANTAGES OF THE N EW MODEL
The proposed structure has many advantages to the current structures within UEFA. The most
important of these is the representation of relevant interests at a decision-making level. We must
remember first the purpose of the council, to manage professional football at a European level. When
we reflect on the stakeholders’ map for the European Football Industry, we discover that all relevant
stakeholders directly involved in the production of European Football are represented at the council.
As to UEFA, their interests would be clearly represented with their 5 members. Furthermore they
252
would retain an extra power with the CEO holding the casting vote. In this way UEFA could listen
directly from the players and clubs and share with them their wider perspective on the game. The last
power reserved by UEFA would be that the Executive Committee could retain a veto power in the case
that the Council makes a decision which is outside their scope and could be harmful to the greater
253
aspects of football. These two mechanisms provide for a balance of power which keeps UEFA in a
privileged position, able to look at the professional game as a whole and as a part of the larger picture
254
of football.
Some challenges are present for this new Council though they are not insurmountable. It is clear that
though representation is almost satisfied for the major stakeholders, the National Associations who
would have to vote on this change may be reluctant. The UEFA ExCo will have the role of overseeing
the council from a distance because this gives them the independence to look at the council’s
decisions from an external and more global view. Another challenge on an administrative level will be
the transition of the Professional Football and Marketing Division which may need to reorganise itself
with its own finance department.
The strongest advantage of the powers of this Council rests in the regrouping of the major relevant
stakeholders in the professional game, clubs, national associations, UEFA, national leagues, FIFA and
in an extended way, the EU. In reference to our opening context, we spoke about the heated
251
We note that in February 2002, UEFA hosted the first Club Workshop. We see great value in this and propose to expand
these workshops to include exchanges of club officials for learning, seminars regarding merchandising and marketing for
example.
252
This is a mechanism which has been used at the Professional Cycling Council and with great success.
253
Also to note is the fact that the representation of the major stakeholders at the PCC has never rendered a decision which
has been vetoed by the UCI Management Co mmittee showing that in principle their new model of governance is working well.
254
Geneviève Berti expressed that the clubs recognise the need for an independent body to have a wider and more long-term
perspective of the game. In this way, the clubs are involved in the decisions but because they have a more short term view, the
veto power is retained by the more independent body.
107
declarations between the actors of European football across the headlines of sports news. In this new
model we bring them together to speak at the same table and to present the relevant interests before
decisions are made.
108
EPILOGUE
Having wandered through the world of European football, sought the counsel of the wise, discovered
new things and created our model, we retreat back through the coats from the wardrobe into the world
strangely feeling that almost no time has passed and we are returning to the same European football
reality. But we have a strong feeling that we have discovered a treasure and must share it with the
“football family”. Integration of the relevant stakeholders, a professional roof to cover and join the two
pillars of European football and a balance on the scales of power and interests are the messages
which we hope to pass through this paper. Again, we do not claim to have found a panacea to cure all
football’s ailings because no model, no matter how well designed, will always satisfy all interests.
However, we do believe that the unresolved dissonances of which we spoke in our prologue will have
a better chance to find their harmonic accord. Most importantly, we hope to open the dialogue
between the family members, who although on the same stage speak in rhetorical soliloquy, so that at
the curtain’s final whistle their audience rise in ovation and cry “Encore! Encore of football!” filling the
cathedrals of the beautiful game.
109
ABOUT THE AUTHORS
The authors are all students in the International Master in Management, Law and Humanities of Sport
organized by the Centre International d’Etude du Sport in Neuchâtel, Switzerland. They represent the
third promotion of the Master who has been created in 2000 at the initiative of FIFA. The course which
started in September 2002 and ended in July 2003 has taken them to three universities in three
different countries: De Montfort University (Leicester. England), SDA Bocconi (Milan, Italy) and the
University of Neuchâtel (Neuchâtel, Switzerland).The authors wrote the paper between May and June
2003 as part of their Masters degree. A profile and contact details of the authors can be found below.
PIERRE D UCREY
After obtaining a Masters degree in international relations at the Graduate Institute of International
Relations in Geneva, Pierre worked in the sports media industry before deciding to take the CIES-
FIFA master program. After the program, he spent a few months working for the Special Adviser to the
United Nations Secretary General on Sport for Development and Peace and currently works as an
intern in the Sports Department of the International Olympic Committee.
Email: [email protected]
CARLOS EDUARDO CARUSO F ERREIRA
Carlos Eduardo is an MBA with a business and management background. In 2002, as a first step
towards a long-planned career specialisation in the sports industry, he decided to take a leave of
absence from his job at A.T. Kearney – an an international management consulting firm - to join the
CIES-FIFA Master program. He is currently working in a project commissioned by FIFA and linked to
Dr. João Havelange, former FIFA President.
GABRIEL HUERTA
After spending ten years working in the corporate world, Gabriel decided to follow his passion for
sports and enrol in the CIES-FIFA Master. Gabriel also holds an MBA in International Management
from Thunderbird in the U.S. After completing the master, Gabriel plans to pursue a career in the
sports industry with an international organization.
K EVIN TALLEC MARSTON
Actively involved in sports, as a coach, player, administrator, volunteer and fan coupled with a passion
for cultures, languages and international experiences, Kevin was naturally drawn to the International
Master. He hopes to serve the sports movement and apply his multi-disciplinary background in the
most effective way.
110
REFERENCES
I. LIST OF GRAPHS AND TABLES
Figure I – The hypothesis -driven approach 8
Figure II – The original project issue tree 10
Figure 1.1 – The pyramidal structure of European football 11
Figure 1.2 – The structure of the football industry 15
Figure 1.3 – Estimated market size of the European Football Industry 17
Figure 1.4 – Breakdown of top-division clubs revenue streams – 2000/01 18
Figure 1.5 – Summarized Value Chain of the Football Industry 19
Figure 1.6 – Stakeholders Map of the European Football Industry 23
Figure 1.7 – European Competition Calendar – Elite Professional Football – Season 2002/2003 26
Figure 1.8 – Format of the UEFA Cup 28
Figure 2.1 – UEFA’s Structure 40
Figure 2.2 – Evolution of UEFA’s staff – 1964 -2002 40
Figure 2.3 – UEFA’s Administrative Structure 41
Figure 2.4 – UEFA Consolidated Income Statement 44
Figure 2.5 – Evolution of UEFA’s Revenues 45

Graphs
Figure 2.6 – Evolution of UEFA’s Expenses 46
Figure 2.7 – Structure of the European Club Forum 48
Figure 2.8 – Evolution of the number of matches played by the UEFA Champions League winner 55
Figure 2.9 – Premiership Foreign Players season 1998/99: 59
Figure 2.10 – The 18 Members of G-14 60
Figure 2.11 –G-14 – Major milestones 61
Figure 2.12 – Structure of G-14 63
Figure 2.13 – Summary of G-14 votes as of Jul ’03 63
Figure 3.1 – Map of convergence and divergence of interests 65
Figure 3.2 – Correlation between average league attendance and TV Income - 2000 68
Figure 3.3 – The G-14 Stars at the UCL 2002/03 – Where are they formed? 72
Figure 3.4 – Evolution of the total number of matches played at the UEFA Champions League 74
Figure 3.5 – Evolution of the distribution of UCL’s income 76
Figure 5.1 – Stakeholders Map of the European Football Industry 101
Figure 5.2 – Current Governance Model of European Football 103
Figure 5.3 – Proposed Governance Model for European Football 104
Figure 5.4 – The European Professional Football Council – Membership structure 105
Table 1.1 – General overview of stakeholders interests, power and pressures 23
Table 1.2. The road to global modern sport 30

Tables
Table 2.1 – Overview of Top European Leagues 52
Table 2.2 – Club categorisation 54
Table 2.3 – Comparison of clubs’ business activities 56
Table 2.4 – Players coming from youth divisions 58
111
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th
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st
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th
§ Platini: I’d axe the Champions League, April 15 2003
th
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th
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st
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113
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§ G14 Soccer Clubs in Favour of Salary Caps, 16 May 2002
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§ Soccer's G14 Lobby Group Opens Brussels Office, 19 March 2001
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§ Soccer's G14 Group to Enter Fifa-UEFA Transfer Talks, 31 January 2001
§ European Super League Proposal a Bluff, Says Report, 4 December 2000
§ UEFA Threatens Top Clubs with Expulsion, 25 September 2000
§ G14 want changes to Champions League, 22 August 2000
§ Euro Clubs Lure UEFA’s Kurth, 14 July 2000
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C. R EPORTS
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114
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.
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Conference on Sport 1999, European Commission DGX, Brussels, April 1999
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ASBL v. Bosman (Case C-415/93), 1996, All E R (EC) 189 ECJ
§ EU PRESS RELEASE IP 02/942, Commission closes investigation into UEFA rule on multiple
th
ownership of football clubs, June 27 2002
§ MEETING BETWEEN MRS. READING AND THE EUROPEAN SPORTS FEDERATIONS,
th
Walking toward a new partnership, April 17 2000
F. OTHER DOCUMENTS
§ IOC Brochure, The athletes within the Olympic Movement
§ IOC Final Report on the XXVIIth Olympiad, 1997-2000
§ UCI Brochure The Professional Cycling Council
§ G-14 Press Kit
§ GPWC Press Release, 17 July 2003
115
III. INTERVIEWS
§ ANDREU-ROMEO Jaime, Head of European Sport Unit, European Commission, Brussels June
th
13 2003
th
§ ARAÚJO Leonardo de Nascimento, FIFA World Cup ‘94 Champion (Brasil), Milan, March 7 2003
th
§ BARTON John, Manager of legal affairs, T.E.A.M. Marketing, Luzern, June 18 2003
th
§ BERTI Geneviève, Communications Manager, G-14, Brussels, May 15 2003
th
§ BRUNELLI Marco, Lega Calcio, Milan, June 12 2003
th
§ BUNN Richard, TV and Media consultant, Neuchâtel, May 13 2003
th
§ CENTENARO Michele, Senior Product Manager, Club Competitions, UEFA, Nyon, June 17 2003
th
§ CHAMPAGNE Jérôme, Deputy Secretary General, FIFA, Zürich, June 18 2003
th
§ DE LA FUENTE Jean-Paul, Media executive, CEO of Deureka, Neuchâtel, May 25 2003
th
§ GILLIERON Peter, General Secretary, Swiss Football Association, Bern, June 13 2003
th
§ GUÉNAIRE Michel, Head of Division Sport -Law, Gide, Loyrette et Nouel, Paris, June 20 2003
th
§ HECHT Rodolfo, President, Media Partners Group, Milan, June 12 2003
§ HILL Jonathan, Communications and Public Affairs Liaison to the European Union, UEFA,
th
Brussels, May 15 2003
th
§ INFANTINO Gianni, General Counsel Commercial Legal Services, UEFA, Nyon, June 17 2003
th
§ KURTH Thomas, General Manager, G-14, Brussels, June 13 2003
th
§ MARCHESI Antonio, Senior Partner, Deloitte and Touche Italy, Milan, June 12 2003
th
§ OLSSON Lars-Christer, Director of Professional Football and Marketing, UEFA, Nyon, June 17
2003
§ OSWALD Denis, Member of IOC Executive Committee and President of FISA (Fédération
th
Internationale de Sociétés d’Aviron), Neuchâtel, May 28 2003
th
§ ROUGER Arnaud, Legal Adviser, Ligue de Football Professionnel, Paris, June 20 2003
§ RUMO Freddy, former UEFA vice-President, President of the Executive Board of Neuchâtel
th
Xamax FC, La Chaux-de-Fonds, June 19 2003
th
§ RUMPF Alain, Coordinator, Professional Cycling Council, UCI, Aigle, June 20 2003
th
§ SLACK Jefferson – Managing Director, Inter Active, FC Internazionale, Milan, June 12 2003
th
§ SZYMANSKI Stefan, Sport economist, Neuchâtel, May 25 2003
IV. PRESENTATIONS
§ ANDREFF Wladimir & BOURG Jean-Francois, Broadcasting rights and Competition in European
Football, Paper presented at the CIES&ASIE International Conference on Sports and the Media,
Neuchâtel, May 23 2003
§ BRUNELLI Marco, Organisation, structure and Functioning of Professional Football in Europe,
Lecture at SDA Bocconi, Milan, January 7th
§ MONNIER Vincent, Head of National Associations Department at FIFA, Presentation to the CIES
Master class 2002-2003, Neuchâtel, May 2003
§ OLSSON Lars-Christer, Director of Professional Football and Marketing at UEFA, UEFA’s
Approach to Sports Marketing, Presentation to the CIES Master class 2002-2003, Nyon, May 5th
2003
116
§ TURRIAN Jean-Paul, UEFA Director of Services, Welcome to UEFA, Presentation to the CIES
Master class 2002-2003, Nyon, May 5th 2003
V. SPEECHES
§ PONS Jean-François, Le sport et la politique européenne de la concurrence : règles du jeu et

exemples récents, Lille, May 10th 2001
§ OREJA Marcelino, former Member of the European Commission in charge of the sport unit,
Speech addressing the 7th European Sport Forum, 1997
§ MONTI Mario, Competition and Sport, the Rules of the Game, European Commissioner for
competition, Sport Governance Conference, Brussels, February 2001.
VI. WEBSITES
Governing bodies
§ UEFA - www.uefa.com
§ FIFA - www.fifa.com
§ International Rugby Union - www.irb.com
§ International Basketball Federation - www.fiba.com
§ International Tennis Federation - www.itftennis.com
§ World Boxing Federation - www.wbo-int.com
§ International Basketball Federation - www.fiba.com
§ Fédération Internationale de Sociétés d’Aviron - www.worldrowing.com
Leagues
§ FA Premier League (UK) - www.premierleague.com
§ The Football League (UK) - www.football-league.co.uk
§ Ligue Professionnelle de Football (FR) - www.footpro.fr
§ Bundesliga (GE) - www.bundesliga.de
§ Lega Calcio (IT) - www.lega-calcio.it
§ Lega Professionisti Serie C - www.lega-calcio-serie-c.it
§ Liga de Fútbol Profesional - www.lfp.es
Clubs
§ G-14 website – http://www.g14.com
§ Atalanta Bergamo website - http://www.atalanta.it
§ Bayer Leverkusen website - http://www.bayer04.de
§ FC Internazionale website - www.inter.it
§ FC Nantes Website - www.fcna.fr
§ Juventus FC website - www.juventus.com
§ Paris-Saint-Germain - www.psg.fr
§ Real Madrid Official website - www.realmadrid.com
Sport news websites
§ Sportbusiness.com
§ Sportcal.com
§ Sport.fr
117
On-line newspapers and magazines
§ www.independent.co.uk
§ Ouest France Newspaper - http://www.ouest-france.fr
§ Fortune - www.fortune.com
§ The Economist - www.economist.com
§ Business Week - www.businessweek.com
European Union
§ www.europa.eu
Independent
§ AC Milan Generation - http://www.mgeneration.it/index2.html
§ Bayer Company - http://www.sport.bayer.com
§ Bolton History - http://www.boltonwanderers-mad.co.uk
§ Early Italian football competitions - http://digilander.libero.it/Ajaxbologna/
Calcio/CalcioItalia1a.html
§ Euro Cups Online - http://galeb.etf.bg.ac.yu/~mirad/archive.html
§ GPWC – www.gpwc.com
§ History of Juventus website - www.juventuz.com
§ FC Inter history website - http://www.geocities.com/tritolos/History.html
§ Rec.Sport.Soccer Statistics Foundation - http://www.rsssf.com
§ French non-official website of Bayern Munchen - www.fcbayern.st.fr
118
APPENDICES
APPENDIX a. - List of National Associations member of UEFA (in alphabetical order)
1. Albania 19. F.Y.R Macedonia 36. Poland
2. Andorra 20. Georgia 37. Portugal
3. Armenia 21. Germany 38. Republic of Ireland
4. Austria 22. Greece 39. Romania
5. Azerbaijan 23. Hungary 40. Russia
6. Belarus 24. Iceland 41. San Marino
7. Belgium 25. Israel 42. Spain
8. Bosnia-Herzegovina 26. Italy 43. Scotland
9. Bulgaria 27. Latvia 44. Slovakia
10. Croatia 28. Liechtenstein 45. Slovenia
11. Cyprus 29. Lithuania 46. Spain
12. Czech Republic 30. Luxembourg 47. Sweden
13. Denmark 31. Malta 48. Switzerland
14. England 32. Moldova 49. Turkey
15. Estonia 33. Netherlands 50. Ukraine
16. Faroe Islands 34. Northern Ireland 51. Wales
17. Finland 35. Norway 52. Yugoslavia
18. France
119
APPENDIX b. - UEFA Solidarity Programmes
The Eastern European Assistance Bureau which is guided by the EEAB Charter aims to assist and support
these new associations which emerged from the break-up of the former USSR - Armenia, Azerbaijan, Belarus,
Estonia, Georgia, Latvia, Lithuania, Moldova, Russia and Ukraine - as well as Albania, the Former Yugoslav
Republic of Macedonia and from February 1999, Bosnia-Herzegovina. The help is in areas such as
administration and management, infras tructure, commercial matters and the popularisation of football, with the
objective of integrating them into the UEFA family as quickly as possible, and of promoting and developing
football by reinvesting football revenue back into the game, thereby preserving and strengthening football’s
position as the number one sport in Eastern Europe. Created in 1994 and incorporated into the Development
office in 1997, UEFA plans to expand this to all 52 national associations. Each EEAB signatory pays a 20% levy
from their TV and advertising income into a special EEAB fund, from which money is entirely reinvested within the
associations in question. The respective sums are then increased by the EEAB by at least 25%, up to a maximum
CHF 500,000 per EURO and World Cup qualifying period and reinvested in the association concerned. The
EEAB’s daily activities are overseen by the Assistance Programmes Committee, comprising a chairman and ten
members. The chart below shows the amounts of the subsidies given by UEFA to the member associations for
this programme.
UEFA SUBSIDIES TO EEAB255
Year Amount (CHF)
1998-1999 256 7,093,678.07
1999-2000 257 5,729,348.96
2000-2001 3,775,462.68
2001-2002 258 7,809,520.79
The Meridian Project initiated in 1996 is a joint partnership between UEFA and its sister confederation in Africa,
the ‘Confédération Africaine de Football (CAF)’ which has an ambitious plan aiming at further developing the
game in Africa from both a technical and administrative point of view. The recent performances by African teams
in recent world senior and youth competitions, as well as the flow of talented African players to European clubs
over the years, demonstrates the considerable potential that exists on the African continent. In line with its goal of
promoting the game, UEFA is engaging in this project to strengthen the world game as a whole. As part of the
programme, CAF has been invited to select, every two years, two African associations to benefit from UEFA’s
assistance. Chad and Namibia were the first two countries selected, in 1997, and they profited from the
experience acquired by UEFA over the years, particularly as a result of the East European project. In Spring
1999, Eritrea and Niger were chosen as the next two "beneficiaries" to receive direct assis tance via the Meridian
project, and Cape Verde and São Tomé and Principe are the latest African associations to benefit from a special
two-year aid programme259. Among the other activities in this programme is the Meridian Cup, the inaugural
version which took place in Portugal. Successive editions have been staged every two years recently in Cape
Town, South Africa and Bari, Italy with Egypt hosting the next edition. In the three tournaments held so far, UEFA
and CAF have been represented by four Under-17 teams each, and each tournament has represented a
wonderful chance for young players to experience different cultures and customs.
255
UEFA Financial Reports 1998-99, 1999-2000, 2000-01 and 2001-02
256
This figure includes both the subsidies to EEAB and the Meridian Project
257
This figure includes both the subsidies to EEAB and the Meridian Project
258
This figure included CHF 1,571,635.83 in auditing expenses
259
UEFA Financial Report 2001-2002. UEFA donated CHF 682,514.33 to the Meridian Project.
120
Also as a part of the ADD, UEFA runs several projects in their Charity Portfolio including working with the
Special Olympics, the world’s largest sports training and competition project for children and adults with mental
handicaps. Since 1999, UEFA has been supporting a football development project set up by Special Olympics
both in Europe and Asia. Approximately 25,000 Special Olympics athletes in Europe and Eurasia alone are
involved in the sport, and UEFA has joined forces with Special Olympics as part of a campaign to give
handicapped people at all levels the necessary self-esteem and confidence to play football. Spring 2001 saw the
stepping-up of the co-operation between the two organisations, with UEFA giving committed support to a Special
Olympics European Football Week in more then 30 countries, involving sports bodies, the business sector and
local communities in special competitions, training programmes and public awareness activities. It is hoped that,
through the UEFA/Special Olympics tie-up, the number of handicapped people playing football will increase by
another 25,000 by 2005.260 UEFA works with the grassroots football programme of the Danish Cross Cultures
Project Association (CCPA) called Open Fun Football Schools 261. This programme aims to foster tolerance,
integration and peaceful coexistence in the Balkans, and the project runs 185 Open Fun Football Schools for
37,000 children between 8 and 14 years of age. UEFA aids these local programmes with young people in
connection with a wider role in FARE (Football Against Racism in Europe) 262. Lastly, UEFA has begun a
partnership with the International Committee of the Red Cross (ICRC) in 1997. This partnership is primarily a
campaign against anti-personnel mines or landmines. The strategy of the relation has been to adopt a common
humanitarian theme through which UEFA provides financial support to ICRC activities. Until now, UEFA has
associated itself with humanitarian efforts aimed at helping landmine victims in the Balkans and the Caucasus
among other countries. Since 2002, both organisations have a new powerful partnership theme: Children in War,
which corresponds to priorities of both institutions. For UEFA, to develop the concepts of fair play, solidarity and
team-spirit among youth is essential in order to maintain the spirit of football. For the ICRC, there are basic
humanitarian principles which should be respected in order to protect youth and children, who are among the
most vulnerable in times of war. Furthermore, the concept of sport has time and again demonstrated its
effectiveness to promote rehabilitation, both mental and physical, for people affected by war – such as child-
soldiers or children victims of landmines. To date, UEFA has contributed a total of CHF 5.1 million in support of
ICRC humanitarian activities since 1997263. Below is a chart of a four year cycle illustrating UEFA’s humanitarian
aid activities.
TOTAL SUBSIDIES TO HUMANITARIAN AID OVER FOUR YEAR CYCLE (1998-2002)264
Year Total subsidy265
2001-2002 705,480.35
2000-2001 2,015,651,50
1999-2000 1,989,435.30
1998-1999 746,218.45
UEFA’s last major programme is the Kiosk programme which was approved by the UEFA Executive Committee in
December 2000. Assigned an initial one-year budget of €670,000, most recently CHF 677,141.55 in 2001-
2002266, it is intended to complement the EEAB Assistance programme, extending the services that it offers to
other UEFA member associations. Participating associations may select from the educational programmes and
technical, administrative and infrastructure assistance in a target-oriented programme.
260
Check press release on Special Olympics in Dublin
261
UEFA Website. ADD section, Open Fun Football Schools.
262
UEFA Website. ADD section, FARE.
263
UEFA Website. ADD section, ICRC.
264
UEFA Financial Reports 1998-99, 1999-2000, 2000-01 and 2001-02.
265
All amounts in CHF
266
UEFA Financial Report 2001-2002.
121
APPENDIX c. – European Football Clubs Listed on the Stock Exchange
European Soccer Clubs Listed on Stock Exchange – 23/06/03

Club Market
England
Arsenal Holdings OFEX
Aston Villa LSE
Birmingham AIM
Charlton Athletic AIM
Chelsea Village AIM
ENIC Plc AIM
Leeds United Plc LSE
Manchester City OFEX
Manchester United Plc LSE
Millwall Holdings LSE
Newcastle United Plc LSE
Preston North End LSE
Sheffield Utd LSE
Southampton Leisure LSE
Sunderland FC Plc LSE
Tottenham Hotspur Plc LSE
Watford Leisure LSE
Italy
AS Roma Calcio Milan
Juventus Spa Milan
SS Lazio Spa Milan
Germany
Borussia Dortmund Frankfurt
Portugal
Sporting Lisbon Lisbon
FC Porto Lisbon
Netherlands
AFC Ajax Amsterdam
Turkey
Besiktas Istanbul
Galatasaray Sportif Istanbul
Denmark
Aab Aalborg Copenhagen
Brondbyernes Copenhagen
Parken Sport & Ent Copenhagen
AGF Kontrakfodbold Copenhagen
SIF Fodbold Copehagen
Scotland
Celtic LSE
Rangers Football Club OFEX
Aberdeen AIM
Heart of Midlothian LSE
Source : Sportcal.com
122
APPENDIX d. – G-14 Voting Structure as of July 2003
Before Sep’00 Sep’00 After Sep ’00 G-14 votes

(a) (b) (c) (d) (f) (g) (as of Jul ’03)
Sign-in Titles Titles Votes Titles Titles Share
Clubs votes UCL U-Cup (a+2b+c) UCL U-Cup (d+2f+g) (%)
Real Madrid 3 8 2 161 1 - 18 12.2
AC Milan 3 5 2 15 1 - 17 11.6
Liverpool FC 3 4 2 13 - 1 14 9.5
Ajax FC 3 4 2 13 - - 13 8.8
Bayern Munich 3 3 2 11 1 - 13 8.8
Juventus FC 3 2 4 11 - - 11 7.5
Inter Milano 3 2 3 10 - - 10 6.8
FC Barcelona 3 1 4 9 - - 9 6.1
Manchester Utd. 3 2 1 8 - - 8 5.4
Bor. Dortmund 3 1 1 6 - - 6 4.1
FC Porto 3 1 - 5 - 1 6 4.1
PSV 3 1 1 6 - - 6 4.1
Ol. Marseille 3 1 - 5 - - 5 3.4
Paris St Germain 3 - 1 4 - - 4 2.7
Bayer Leverkusen 1 - 1 2 - - 2 1.4
Valencia CF 1 - 1 2 - - 2 1.4
Arsenal FC 1 - 1 2 - - 2 1.4
Ol. Lyonnais 1 - - 1 - - 1 0.7
Notes: 1) The maximum number of votes allowed at the time of foundation (Sep’00) was limited to 16.
Source: G -14 Press Release, UEFA, authors’ analysis
123

UEFA and Football Governance A New Model

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CENTRE INTERNATIONAL

UEFA and Football Governance: A New Model

Adaptations for the challenges of modern football

Final Project Work

International Master (MA) in Management, Law and Humanities of Sports

CHAPTER ONE: BACKGROUND -------------------------------------------------------------------------------- 11

1.1. STRUCTURE OF E UROPEAN FOOTBALL -------------------------------------------------------------------- 11

1.1.2. The European Football Industry --------------------------------------------------------------------------- 14

1.1.3. Stakeholders’ Map -------------------------------------------------------------------------------------------- 22

1.1.4. Professional Football Competition Calendar ----------------------------------------------------------- 26

1.2. MODERN ISSUES ----------------------------------------------------------------------------------------------- 29

1.2.1. Football and Globalisation ---------------------------------------------------------------------------------- 29

1.2.2. Football and the European Union ------------------------------------------------------------------------- 32

CHAPTER TWO: THE ACTORS ---------------------------------------------------------------------------------- 35

2.1 UEFA AND NATIONAL ASSOCIATIONS --------------------------------------------------------------------------- 35

2.1.1. The Birth of UEFA -------------------------------------------------------------------------------------------- 35

2.1.2. UEFA’s Mission ----------------------------------------------------------------------------------------------- 36

2.1.3. UEFA’s Organisation ----------------------------------------------------------------------------------------- 39

2.1.4. The Relationship with National Associations ----------------------------------------------------------- 41

2.1.5. Solidarity – “We Care About Football” ------------------------------------------------------------------- 42

2.1.6. UEFA’s Finances --------------------------------------------------------------------------------------------- 43

2.1.7. UEFA’s Latest Developments------------------------------------------------------------------------------ 46

2.2 NATIONAL L EAGUES ------------------------------------------------------------------------------------------------ 51

2.3 THE CLUBS ----------------------------------------------------------------------------------------------------------- 53

2.3.2. The Pursuit of the Goals ----------------------------------------------------------------------------------- 56

2.4 G-14 ------------------------------------------------------------------------------------------------------------------ 60

2.4.2. The Creation of the Grouping ------------------------------------------------------------------------------ 61

2.4.3. Objectives ------------------------------------------------------------------------------------------------------- 62

2.4.4. Structure of G-14 ---------------------------------------------------------------------------------------------- 62

CHAPTER THREE: THE CONFLICTS --------------------------------------------------------------------------- 65

3.1 CONVERGENCES AND DIVERGENCES OF INTERESTS ---------------------------------------------------------- 65

3.1.2. UEFA and Clubs ---------------------------------------------------------------------------------------------- 68

3.1.3. Leagues and Clubs ------------------------------------------------------------------------------------------- 70

3.1.4. G-14 and Other Clubs --------------------------------------------------------------------------------------- 71

3.2.1. Competition ----------------------------------------------------------------------------------------------------- 73

3.2.2. Revenue Distribution ----------------------------------------------------------------------------------------- 75

3.2.3. Other Areas of Conflict -------------------------------------------------------------------------------------- 77

3.2.4. Representation ------------------------------------------------------------------------------------------------ 80

3.3 SCENARIOS OF P OTENTIAL D EVELOPMENTS OF THE CONFLICTS ------------------------------------------- 82

3.3.1. The Cold War of European Football --------------------------------------------------------------------- 83

3.3.2. Competition ----------------------------------------------------------------------------------------------------- 85

3.3.3. Revenue Distribution ----------------------------------------------------------------------------------------- 86

CHAPTER FOUR: CONFLICT MANAGEMENT OUTSIDE EUROPEAN FOOTBALL ------------- 88

4.1 CASE STUDIES ------------------------------------------------------------------------------------------------------- 88

4.1.2. The GPWC and Formula One ----------------------------------------------------------------------------- 90

4.1.3. The IOC Athletes’ Commission ---------------------------------------------------------------------------- 93

4.1.4. The Professional Cycling Council ------------------------------------------------------------------------- 95

4.2 GENERAL LESSONS LEARNED ------------------------------------------------------------------------------------- 97

CHAPTER FIVE : A POSSIBLE SOLUTION ------------------------------------------------------------------- 101

5.1 STRUCTURAL PROPOSAL ------------------------------------------------------------------------------------------ 101

5.1.2. The Proposed Model – An Expanded Dialogue ------------------------------------------------------- 102

5.1.3. The European Professional Football Council ---------------------------------------------------------- 105

5.1.4. The New European Club Forum -------------------------------------------------------------------------- 106

5.1.5. Advantages of the New Model ----------------------------------------------------------------------------- 107

EPILOGUE --------------------------------------------------------------------------------------------------------------- 109

ABOUT THE AUTHORS --------------------------------------------------------------------------------------------- 110

REFERENCES ---------------------------------------------------------------------------------------------------------- 111

I. LIST OF G RAPHS AND TABLES -------------------------------------------------------------------------------------- 111

II. BIBLIOGRAPHY -------------------------------------------------------------------------------------------------------- 112