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Premier League clubs to discuss financial controls

Reuters
Sep 22, 2012 at 09:05am IST

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London: Curbs on club wage bills and other financial safeguards will be discussed next week when English Premier League teams meet to examine ways to ensure teams operate on a sound financial basis.

The 20-team Premier League is the richest in the world in terms of revenue but player salary costs eat up a large proportion of its income, leaving slender overall profits and some clubs deep in the red.

The top clubs are already having to prepare for European Financial Fair play rules which mean teams must cut losses or face exclusion from continental club competitions from 2014-15.

EPL clubs to discuss financial controls

The 20-team Premier League is the richest in the world in terms of revenue but player salary costs eat up a large proportion of its income.

The risks of clubs trying to live beyond their means are obvious in Britain.

Third division Portsmouth, in the Premier League as recently as 2010, have been in administration since February after getting into financial difficulties.

In Scotland, former champions Rangers are now playing in the fourth division after collapsing under the weight of their debt.

Premier League clubs will split into two working groups next week and discuss whether to adopt UEFA's Financial Fair Play measures wholesale.

They will also examine alternatives including placing a limit on player costs or seeking lengthy guarantees from club owners that they can meet their bills.

The meetings are exploratory and no firm decisions are expected to be taken. The agreement of 14 clubs would be needed before any measures could be adopted and while many clubs want action, there is no consensus on what form it should take.

Manchester City, who won the Premier League last season, are bankrolled by Abu Dhabi's Sheikh Mansour Bin Zayed Al Nahyan who has been prepared to run up losses while building a trophy-winning team.

The Premier League has just secured a new domestic TV deal worth more than one billion pounds per season from 2013, a 70 percent increase.

It is now starting to renegotiate overseas TV deals and on Friday invited applications to show matches in the Americas. In the United States, Fox, part of News Corp, currently has the live rights, with Monday games sub-licensed to Disney-owned ESPN.

Seeking to maximise revenues, the Premier League will sell rights for Brazil as a separate package after previously having sold matches as a single bundle in South and Central America.

The Premier League makes more than 1.3 billion pounds from overseas rights under a three-year deal that expires at the end of the current season.

Manchester United said this week that it expected to see a substantial increase when overseas deals are renewed in the coming months.

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