European soccer clubs may soon get some financial breathing room in the form of a $7.1 billion relief package from the Union of European Football Associations.
UEFA is working on a set of measures and reforms that would not just help teams recover from the pandemic revenue hit, but restructure the financial system of European soccer.
The continent’s governing soccer body is seeking to ease the pain of future financial shocks while creating more parity among teams.
- UEFA would establish a credit facility of $2.4 billion to $7.1 billion, which clubs could borrow from at a low rate.
- The period that clubs could restructure existing debt would lengthen to five-to-seven years.
- UEFA would introduce a luxury tax on teams whose player salaries exceeded a certain percentage of revenue, possibly 70%. Funds collected from the tax would be redistributed to other clubs.
The reform package is expected to be rolled out in the coming weeks. UEFA has been in talks with investment firm Centricus Asset Management on financing the credit facility.
The European soccer market fell to $29.7 billion in the 2019-2020 season, a 13% drop from the previous season according to Deloitte. It was also the first time in history that the Premier League’s revenue declined.