Rui Costa Makes Benfica Financial Fair Play Claim

Benfica’s president, Rui Costa, has reassured fans that the club is not at risk of violating UEFA’s Financial Fair Play rules, citing the club’s strong equity position.

As reported by Maisfutebol, the former midfielder has claimed there are no worries for fans of As Águias, who have had a poor start to the season. They’ve recently got rid of manager Roger Schmidt, with Bruno Large returning to the club.

However, a deeper look at the accounts reveals a worrying trend: over the past five years, the club’s equity has halved, falling from €161.1 million in 2020 to €81.9 million in 2024.

The most significant declines occurred during Rui Costa’s presidency, with the club losing over €65 million in equity during his two-year tenure. Despite an increase in assets, which rose by €88.1 million, liabilities have grown at a faster rate. Liabilities now stand at €483.4 million, up from €325.9 million in 2020—a staggering increase of €157.5 million.

Many of these liabilities come from operating expenses, which have increased to €252.2 million. Personnel costs, one of the largest expenditures, total €110 million, although they have slightly decreased compared to the previous year. The club’s debt has also ballooned, reaching a record €222.2 million, more than doubling from €98 million in 2020.

While Rui Costa remains optimistic about the club’s financial health, the rapid rise in liabilities and bank debt raises questions about Benfica’s long-term financial stability and its ability to comply with UEFA’s stringent financial regulations.

The club has had a somewhat mixed start to the 2024/25 season. In the Primeira Liga, they’ve shown resilience but haven’t hit peak form yet. The 2-0 loss to Famalicão on the opening day was the start of troubles, and despite wins against Casa Pia (3-0) and Estrela Amadora (1-0), a 1-1 draw with Moreirense was the end of the road for Schmidt.

They are in the Champions League after finishing second last season, and that could provide some financial respite if they can prove to be a success. With Barcelona, Bayern Munich and Juventus on the fixture list, progression will be tough, but perhaps vital to increasing their revenue.

What are UEFA’s rules?

UEFA’s Financial Fair Play (FFP) rules were introduced to promote the financial sustainability of football clubs in Europe. The main objective of FFP is to ensure that clubs do not spend more money than they earn, aiming to prevent financial difficulties and maintain fair competition.

The rules require clubs participating in UEFA competitions, such as the Champions League and Europa League, to balance their income and expenditure over a rolling three-year period. This includes revenues from sponsorships, ticket sales, broadcasting rights, and transfers, but excludes expenses on infrastructure, youth development, and community projects. Clubs are permitted to make a limited financial loss within this period, but excessive deficits can lead to penalties.

Penalties for breaching FFP rules can range from fines to more severe actions like restrictions on player registrations or exclusion from UEFA competitions. The introduction of FFP has encouraged clubs to manage their finances more responsibly, although it has faced criticism for allegedly maintaining the financial gap between wealthy clubs and smaller ones.

FFP continues to evolve, with UEFA introducing reforms aimed at simplifying the system while maintaining financial fairness in European football.

What would the implications of missing FFP target be for Benfica?

If Benfica were to miss UEFA’s Financial Fair Play (FFP) targets, they could face a series of severe financial and sporting consequences. One of the most immediate implications would be financial penalties. UEFA typically imposes fines on clubs that exceed the permissible deficit limits, which could further strain Benfica’s already pressured finances. These fines may be significant, impacting their ability to reinvest in the squad or infrastructure.

Sporting penalties are another serious consequence. Benfica could face squad restrictions in UEFA competitions like the Champions League, limiting the number of players they can register. This would affect their ability to compete at the highest level, as they might not be able to field their strongest team. Such restrictions could hinder the club’s ability to attract top talent in future transfer windows, as players may prefer clubs without these limitations.

The most damaging implication could be exclusion from UEFA competitions altogether. Missing out on the Champions League or Europa League would lead to a major financial blow, as these tournaments provide significant revenue through broadcasting rights, sponsorships, and ticket sales. Without participation, Benfica would lose a crucial income stream, potentially forcing them to sell key players to balance the books.

Additionally, failing to meet FFP targets could harm Benfica’s reputation, affecting relationships with sponsors and investors. Sponsors may view financial instability negatively, leading to reduced commercial deals. In the long term, this could make it harder for the club to compete with wealthier European rivals.