Sports News Without Access, Favor, Or Discretion
Photo credit: Stu Forster/Getty

Qatar is a loathsome county built on corruption, a labor system that closely resembles slavery, and the support of the murder of innocent people through the financial backing of terrorists. Qatar is also the owner of French club Paris Saint-Germain, the country’s luxurious and extravagantly gilded source of soft power, the invaluable entity that gets the world to forget the first sentence and focus on this one. Their efforts to cram the club with soccer players whose star wattage shines so brightly that it blinds people to Qatar’s slaving and support for terrorism has now hit truly incredible levels.


As everyone knows by now, PSG bought Neymar for an insane world-record €222 million. It was a hilarious and stupefying and terrifying transfer, and it turned soccer fans everyone into that Scanners gif. And as strong of proof as it was that PSG are a great and powerful club capable of ripping the world’s most coveted player from the hands of one of the world’s most stately clubs (and, in the process, tearing out the logic centers of said stately club’s brain), which by proxy was proof of how great and powerful Qatar is, the effect has been magnified by the just-as-insane transfer they’ve just pulled off for Monaco’s Kylian Mbappé:

Reports say the transfer fee is supposedly €180 million, and could climb even higher if certain bonuses are met. However, you have to dig into the devilish details to understand why all of this is so sketchy. Here’s how PSG’s press release described the deal:

Paris Saint-Germain is delighted to announce the immediate arrival of Kylian Mbappé. The international French striker is transferred on a loan basis from AS Monaco until June 30 2018. The loan agreement also includes a call option for Paris Saint-Germain which, when exercised, will bind the player to Paris Saint-Germain until June 30 2022.


This “loan” with an “option to buy” language is important, and is how PSG have tried skirting the laws governing the game in order to do what no other team in the world could.

All of this has to do with UEFA’s Financial Fair Play rules. UEFA implemented these rules to prevent clubs from spending themselves into oblivion (à la Portsmouth) by curtailing the practice of clubs with access to large amounts of cash (usually by way of a wealthy owner) throwing lots and lots of it into the team, above and beyond what was fiscally prudent, in an effort to quickly buy themselves a winner. Rich club owners willing to reach into their own pockets to deck out their expensive new toys with as much top-tier talent as possible isn’t necessarily a bad thing (and indeed FFP-style regulations can definitely be overly stringent in this regard); the problems occurred when these rich owners grew bored of their toys (or went poor because of their improvident spending) and stopped footing the bills, sending the club into ruin.


In PSG’s case, the specific rules they’re trying to circumvent are those stipulating that no European club is allowed to lose more than €30 million (or, put another way, to outspend their revenue by €30 million) during any given three-year period. Let’s get into what this means a little.

On a club’s books, any given player’s transfer fee and salary are added together and divided by the number of years on the player’s contract. That number is then counted on the club’s budget expenditure each year for the duration of the contract. So, for a simplified example, let’s say a club signs a player for a €50 million transfer fee and gives him a five year contract worth €10 million annually. This means that for each of the five subsequent years following the parties signing the deal, €12 million will count against the budget.


UEFA audits every club’s books at the start of every season, looking at the income statements of the three prior seasons. If in any given three year period a club’s combined expenditures exceed revenue by €30 million, then that club will have violated FFP. This means a club can exceed revenues by any amount during one season, but they have to be sure that they made enough money the two prior years and that they do so again during the next two seasons in order to offset that one-year spending.

You probably see where things are going. PSG were already going to have to do some fancy accounting to make sure they didn’t run afoul of FFP after that enormous Neymar fee. There is no way in hell they can cook their books in a way that makes dropping well over €400 million (that’s just the combined transfer fee; when you include the huge salaries PSG’s new stars are on, the number jumps way higher) in a single summer appear kosher with FFP. Which brings us to the loan talk.


This strategy of loans with either options or obligations to buy players is a popular tactic clubs use to manage their money commitments. If a club makes a loan-with-option-to-buy deal, they get to evaluate the player for a season or two, see if they like him and foresee a good future for him at the club, and then decide whether or not to pay the pre-agreed fee, which at that point could either seem like a bargain or much too rich depending on the player’s performance. In addition, this allows the team to delay the financial hit that would come with signing the player until the following season, which in the FFP world could make all the difference between following the rules or getting booted from the Champions League (one of the punishments for flouting UEFA’s rules).

There is a risk, though, for the selling club if they agree to loan a player they want to get rid of and only give the buying club an option to finalize the transfer. If something goes wrong and the player doesn’t play the way anyone expected, or if he suffers a severe injury, the club that tried offloading the player might find themselves once again in the same predicament right when they thought they had solved their problem. Because of this, loans-with-obligations-to-buy became more palatable for both selling clubs that no longer wanted their players and buying clubs that wanted to delay the financial hit of the transfer fee.


To keep clubs from abusing this new tactic of evading FFP’s rules, UEFA made it so that loans-with-obligations-to-buy were treated fiscally the same way regular transfers were. This way UEFA could close that loophole and make sure that only, a) buying clubs that really were unsure of whether they wanted to keep a player after a loan, and b) selling clubs that had assumed the risk of a failed player returning to the parent club after a failed loan, could use this loan strategy.

Okay, so with all that out of the way, we can get back to the issue at hand. PSG wanted a phony “loan” for Mbappé so they could put that transfer and salary onto the following season’s books, when hopefully they’d have time to scheme together enough bloated sponsorship contracts to pass their FFP audit. Monaco were amenable to aiding PSG here out of their own desire to cash a €180 million check in exchange for a 18-year-old with only six great months of soccer behind him, but Monaco did not want to lose out on any potential loss of value should Mbappé fail at PSG or get injured or something like that. Thus they pushed for a “loan” that included an obligation to buy Mbappé at the end of it.


The two clubs eventually settled on a middle ground: a loan with an option to buy, but a shady “option” that was for all intents and purposes an obligation. Reports say PSG will only be able to decline to exercise their option if the team gets relegated. Which, for a team that already outspends nearly the entire French league combined, is just about as likely as Leicester City winning the next 11 Premier League titles. Suffice it to say, this loan “option” is a sham, and UEFA shouldn’t let PSG get away with it.

Now, clubs spending tons of money on players feels icky to many, but there generally isn’t anything wrong with it. This sport generates a truly unbelievable amount of money, and it’s only right that the bulk of that goes to the players that have made soccer the biggest show on the planet. But when a club owned by a sovereign nation—and a morally reprehensible nation like Qatar, at that—which is untethered from the financial rules that constrain everyone else and can spend literally as much money as it wants, when it wants, then there is a serious problem. There probably isn’t another club in the world that could’ve come up with the cash needed to trigger Neymar’s release clause the way PSG did. There definitely isn’t any other club that could’ve floated the Neymar deal and this Mbappé one in the same window the way PSG have. PSG are playing a completely different game than anyone else, and it’s one that could undermine the very foundation of the sport.


We’ll see if this is a problem Financial Fair Play is equipped to handle and if UEFA has the guts to use the protective powers at its disposal, or if instead the powers that be will accept this phony “option” and believe the club when their books starting next season show a “renegotiated” shirt sponsor contract that has increased exponentially. UEFA has talked tough about the matter up to this point, but a look at the history of soccer bureaucrats would probably convince you that the Qatars of the world will eventually get their way.

Share This Story

Get our newsletter