Club licensing

The club licensing system represents for UEFA a key project to foster the credibility of the football industry.

It was introduced at the start of the 2004/05 season with the goal of encouraging European club football to look beyond the short term and consider underlying longer-term objectives essential for the game's continued good health. In 2010, a new set of Club Licensing and Financial Fair Play regulations were approved, and consist of the existing annual licensing by national licensing bodies, as well as continuing monitoring by an independent club financial control panel for clubs qualified for UEFA competitions.

The annual licensing is based on a series of defined quality standards, which each club must fulfil to gain admittance to UEFA's club competitions, and on the key principles of transparency, integrity, credibility and capability.

The 36 specific criteria of the licensing system can be broken down into five principal categories: sporting, infrastructure, personnel, legal and financial.

These requirements – developed in cooperation with the national associations – have helped to improve the business credibility of club operations and led to better transparency and governance by clubs and national associations.

A granted licence by the national association proves that a certain quality level is achieved. Further checks coordinated by UEFA in cooperation with independent partners on the proper application of the system at each association reinforce the Europe-wide nature of the system.

Club licensing matters are administered by UEFA's national associations division under UEFA director Theodore Theodoridis.

Progress made
"The introduction of the club licensing system by UEFA in 2004/05 represents a quantum step forward in terms of improving transparency and the overall running of football clubs and goes some way to promote standardisation of the regulatory requirements in football across Europe."
Independent European Sports Review 2006, report by José Luis Arnaut

In 2007 UEFA produced a report on the early years of the scheme, titled Here To Stay – Club Licensing.

By 2007/08 more than 90% of all top-division clubs in Europe had applied for a club licence.

For the 2010/11 season, 611 of the 733 top-division clubs (83%) in Europe underwent this licensing procedure. There were 488 clubs licensed, while five clubs that qualified for UEFA's club competitions had their applications rejected.

One of the chief objectives of club licensing is to add transparency to club football, and a thorough analysis of club licensing decisions as well as the comparative sporting, stadium and financial positions of club football across Europe. This has been set out in the fourth edition of the benchmarking report The European Club Footballing Landscape recently issued to key stakeholders and available on UEFA.com. The 2010 report covers the financial figures of 665 clubs - 90% of all top-division clubs.

The fact that more than 100 clubs were refused licences in 2010/11 shows both the continuing need to raise standards and that the system is actively enforced. The system's credibility depends on consistent application of the regulations, and an independent auditing company annually checks each licensing department. In addition UEFA in cooperation with independent auditors also makes compliance visits checking the details provided by clubs.

To help the system take root across Europe, UEFA provides the national associations with the technical and financial support required to establish an adequate infrastructure. Associations had received €90m from UEFA's solidarity fund by the end of the 2010/11 season.

Club Financial Control Panel
A major development in increasing and improving the transparency and integrity of the system has been the creation of the independent Club Financial Control (CFC) Panel in March 2009. The CFC panel is chaired by the former prime minister of Belgium, Mr Jean-Luc Dehaene, and is composed of legal and financial experts who are independent of national associations, leagues or clubs and whose tasks are to ensure that the UEFA club licensing system is applied correctly across all 53 UEFA member associations and that clubs which have qualified for UEFA's club competitions have fulfilled the criteria defined in the UEFA Club Licensing and Financial Fair Play Regulations.

The functioning of the CFC panel, including its decision-making authority, is governed by Arts. 17-23 of the UEFA Organisational Regulations, 2011 edition.

Furthermore, the CFC panel will also play an essential part in implementing and monitoring the financial fair play concept, which was unanimously approved by the UEFA Executive Committee in September 2009. As such, the CFC panel will have an important role in helping to improve the financial fairness in European competitions and the long-term stability of club football across Europe, combined with the aim of stimulating long-term investment (youth development and upgrading of sporting facilities) over short-term speculative spending.