The prospect of government mandated regulation of football has been generally welcomed by a broad section of the English fanbase, many of whom have become disillusioned with the way the sport has been governed over recent years.
However, both UEFA and the Premier League expressed concern that the government’s Football Governance Bill could affect the ability of both English clubs and the national team to compete internally. UEFA’s warnings led to speculation that England could face eviction from the Euros and World Cup if the government’s planned regulator overstepped its boundaries.
According to Ben Thomas, a Senior Associate at the Bates Wells law firm, which worked with Fair Game on the Bill’s latest amendments, these reports are merely ‘sensationalist headlines’, as he explains in part two of his Q&A with Insider Sport.
Insider Sport: The government has spoken of tackling ‘rogue owners’, can you elaborate on what legal protections the Bill envisions to achieve this?
Ben Thomas: There are two layers of protection in the Bill to protect from “rogue owners”.
First, there is the owners’ suitability test. The test involves three elements: first, the owner must meet the “individual ownership fitness criteria”; second, the owner must have “sufficient financial resources” and third, the source of the owner’s wealth must not be connected to serious criminal conduct.
The fitness criteria are that the person “has the requisite honesty and integrity” and “is financially sound”. It remains to be seen how the regulator will interpret those terms. We are campaigning for the addition of a third element of the criteria, namely, that the owner “respects and promotes the protection of human rights and prevents modern slavery”. We have offered a new clause which adds detail to that phrase.
Second, there are various “heritage” clauses which place restrictions on relocation of a club, changes to key identifiers such as the crest and, crucially, the disposal of a club’s home ground. Many “rogue owners” transfer stadia to a separate legal entity and “asset strip” the club, rendering them much more likely to face insolvency. We are seeking amendments to the relevant provisions to ensure they properly protect club heritage.
IS: On the topic of finance, a lot of lower-league clubs benefit greatly from parachute payments. Why have these not been covered in the legislation?
BT: The majority of lower-league clubs do not benefit from parachute payments. Parachute payments increase the disparity in the football pyramid and they don’t incentivise clubs to be well-run.
Parachute payments go on wage bills, which don’t fall sufficiently when a club gets regulated. The amount spent on players’ wages directly correlates with its league position, so clubs receiving these funds are statistically much more likely to be promoted again. They gain a competitive advantage. As a result, other clubs are increasingly encouraged to overspend on players’ wages and act unsustainably.
Very rarely is a club relegated out of the blue. They know it’s possible and need to plan accordingly. As with any business, they must prepare for the risks they face, which for many clubs include relegation. This needs to be done by building sensible provisions into player contracts and mitigating the financial impact of relegation (for example, amassing sufficient reserves). I’m not saying that it’s easy, I’m saying that it is possible.
We are dismayed that parachute payments are not included within the regulator’s remit. This is not because we want to preserve parachute payments but rather to reassess them as part of an assessment of football’s overall sustainability.
IS: How has the legislation been drafted to ensure compliance with UEFA and FIFA rules around football, to prevent any potential government overreach or negative impact on English teams competing internationally?
BT: Both UEFA, which runs the Euros, and FIFA, which runs the World Cup, have rules prohibiting political or government interference in their domestic football associations. Opponents of the Football Governance Bill consequently argue that a regulator would prevent the national English team from playing in these tournaments because it wouldn’t be viewed as independent from the government. This has led to sensationalist headlines claiming that England will be kicked out of the World Cup.
In my view, this is just scaremongering from those who want to preserve the status quo. The FIFA rules apply to governance of the domestic football association, but there are not many aspects of the Bill that affect the Football Association. There is nothing political about the regulator or what it is trying to do.
The Bill is, in many ways, quite modest in its proposals. The previous draft Bill’s requirement that the regulator must take into account the government’s foreign policy and trade objectives, as I mentioned before, was the most political part of the Bill. Thankfully, this has been removed.
Let’s not forget that this is an opportunity to craft a regulatory regime that puts the interests of fans back at the heart of English football. It’s not an attempt to quash international aspirations but to get back to what English football was originally about: fair play and community.
So many smaller clubs are bound up in local pride and identity. Their value is so much more than just financial, but we’ve created a rigged system in which they’re forced to struggle. Now it’s time to bring in a truly independent regulator to prioritise the common good of the whole game.
