Financial Fair Play in Sports


Leo Feng, News Editor

With sports getting bigger than ever, teams in major sports leagues have now become billion dollar corporations that attract thousands of sponsors, sometimes even bringing in entire countries. As of right now, sports entertainment accounts for around 1% of the total economy. A major percentage of that is attributed to teams paying massive amounts of money to players and coaches with some contracts worth hundreds of millions of dollars. To prevent such egregious spending, sports federations and committees have put financial fair play rules in place such as a luxury tax (an expensive fee teams have to pay for going over the salary cap). However, with more money in sports than ever, teams have managed to find loopholes around such rules or just have outright paid the necessary fees and fines.

This issue of financial fair play has been especially prevalent in the sport of soccer with the most recent infraction coming from English Premier League giants Manchester City, who have been charged with over 100 breaches of financial fair play. These charges range from falsifying tax payments to falsely reporting staff and player salaries ever since 2008, when the club was bought by Sheikh Mansour, a member of the ruling family of the UAE. Because of these infractions, the team is now facing relegation, which in American terms, would be equivalent to the Lakers being expelled from the NBA. However, due to the massive amount of supporters that the club has garnered, the league has withheld from meting out any punishment until sufficient evidence is acquired, a process which could take over four years to finish. In addition, due to Man City’s vast resources, they have hired the best lawyers the UK has to offer which could make it even harder for them to be legally punished in court. This would, of course, set a terrible precedent for the future of sports. 

Financial fair play is incredibly important for a sport that doesn’t have a salary cap or luxury tax. While it may be enticing to withhold from divulging financial information, sports, at the end of the day, are a form of entertainment and transparency should be expected. It detracts from the whole purpose of sports if teams are willing to pay outrageous sums of money, and cheat along the way, just to get an edge over other competing teams who are playing by well established and fair rules.