Among 27 recommendations at the end of a yearlong inquiry, legislators urged English soccer authorities to curb ´ludicrous levels of borrowing´ and the use of profits to service large debts.
The All Party Parliamentary Football Group, which has no power to push through any changes, is calling for a rule change to enforce heavy scrutiny of business plans before any club takeovers, echoing the agenda of the world governing body.
The group also backed FIFA´s ´six-plus-five rule´ that would impose limits on foreign players, urging the British government to lobby the European Union to overlook its treaties on free movement.
The key warning in the report is that while soccer appears to be weathering the initial impact of the recession, the meltdown in the markets that has claimed major financial institutions operating risky business models should serve as a warning to the clubs.
"The financial world has learned a serious lesson in the last year that living by the old adage, ´if it ain´t broke, don´t fix it´ can lead to catastrophic results," said governing Labor Party legislator Alan Keen, who chaired the inquiry. "There is a real danger that English football could go the same way. Corrective action needs to be taken now to address serious weaknesses in the governance of the game as well as severe financial imbalances.
"Our report includes tough measures to improve the way the game is run and to combat ´financial doping´ whereby short term success can be bought at the expense of long term financial stability."
The Premier League already applies a ´fit and proper persons´ test to rule on prospective English club owners, but the parliamentarians want this extended from judging character to ascertaining whether takeovers will burden clubs with large debts. The report highlights concerns over the American takeovers of Manchester United and Liverpool.
After winning the Champions League and Premier League last season, United posted pretax losses of $65.2 million. The repayments on debts of $945 million took $66.2 million annually out of United´s profits.
Likewise, the buyout of Liverpool by Tom Hicks and George Gillett Jr. in 2007 saw debts of $65.2 million rise beyond $509.5 million.
"Owners should not be able to use the clubs´ assets to leverage debt," Keen told The Associated Press. "We want sport to be looked upon as different to other businesses."
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