New details from the process that saw Arsenal sign Eberechi Eze from Crystal Palace in the summer all but confirm that the Gunners are close to the limit under UEFA’s spending rules.
As well as Premier League Profit and Sustainability Rules (PSR), clubs who compete in European competition are subject to UEFA’s Football Earnings test and Squad Cost Ratio rule.
Arsenal, who continue their Champions League campaign against Olympiacos tonight, have ample headroom under both domestic PSR and the Football Earnings test.
But after blasting over £250m in the summer and recouping next to nothing in player sales, the margins are much thinner on the Squad Cost Ratio rule, as exclusively reported by TBR Football back in August.
Eberechi Eze joined in a deal worth up to £67.5m with add-ons, turning down Tottenham in the process.
Martin Zubimendi, Viktor Gyokeres, Noni Madueke, Cristhian Mosquera, Christian Norgaard and Kepa Arrizabalaga signed earlier, and Piero Hincapie’s deadline-day loan-to-buy deal rounded off the window.
New Arsenal CEO Richard Garlick concerned by UEFA spending rules
Since the close of the transfer window, there has been a quiet revolution behind the scenes at the Emirates Stadium.
Tim Lewis, once Stan Kroenke’s right-hand man, has been replaced as executive vice-chairman, a role which until recently made him the most senior boots-on-the-ground official at the club.
Stan and Josh Kroenke remain co-chairs but have been joined by trusted lieutenants Kelly Blaha, Otto Maly and David Steiner, as well as the producer and director Ben Winston in a non-executive role.
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Now, a new report from The Telegraph details how Garlick was concerned that the deal to sign Eze from Crystal Palace could jeopardise their position under UEFA’s Squad Cost Ratio rule.
Under this rule, which is one of the evolutions of FFP, clubs can spend no more than 70 per cent of revenue plus a three-year average of player sale profits on first-team wages, transfers and agents’ fees.
By TBR Football’s estimations, Arsenal’s limit for the calendar year is somewhere in the region of £520m.
Analysis from the football finance expert Greg Cordell estimates that Arsenal’s wage bill for 2024-25 was around £346m, of which around 70-75 per cent is attributable to first-team payroll.
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Meanwhile, amortisation – which is how clubs account for transfer fees and agent payments over a player’s contract length – is projected to stand in the region of £182m.
Both the wage bill and amortisation will have increased significantly after the summer, with only a few million recouped in player sales.
Exclusive: Kieran Maguire’s view on Arsenal’s Squad Cost Ratio position
Speaking exclusively to TBR Football, Liverpool University football finance lecturer and Price of Football podcast host Kieran Maguire has given his verdict on Arsenal’s FFP position at the European level.
“It has to be said that the UEFA rules have more teeth than the Premier League ones,” he said.
“They have been drafted in a more holistic way than the Premier League’s. Because the Premier League ones are voted on by Premier League clubs, they have loopholes built into them.
“That doesn’t exist to the same extent at UEFA For all his faults, Ceferin is able to apply the rules to everyone. The downside to the UEFA rules is that the implementation and tariffs are seen as being quite low.
“But Arsenal are a club who take a degree of pride in being seen to do the right thing.
“With Todd Boehly at Chelsea, getting a huge fine is just seen as one of the costs of doing business. It is no different to a natural resources company being fined for an oil leak. If it’s cheaper than properly maintaining your oil rig, they just get on with it and take the fine.”