Manchester United and Arsenal among clubs threatening legal action to ensure Uefa's FFP rules take effect

Governing body coming under scrutiny to tighten loopholes and prevent huge losses

Premier League clubs are prepared to take legal action, if required, to prevent the division's big spenders evading Uefa's financial fair play rules.

With four of the leading top-flight clubs having reiterated, in writing, their demand for Uefa's full financial fair play (FFP) rules to be brought in to the Premier League, it is becoming clear that some will take recourse to the courts, if necessary, should Uefa not rigorously enforce it. Only when Uefa's way of operating FFP is seen in practice will those clubs who are in favour know if such action is required, but a number of proprietors have made investment decisions in clubs on the basis of FFP being introduced.

Liverpool's principal owner, John W Henry, has said that his own decision to purchase the club, in 2010, was in part based on a knowledge that FFP would introduce a level playing field several years later. Henry was deliberating over whether to buy the club when one of his commercial executives, Joe Januszewski, emailed him to say he thought the club's appeal had increased because of FFP rules preventing clubs sustaining huge losses under wealthy benefactors to spend on players' wages.

Henry said in his first meeting with newspaper journalists after buying Liverpool that it didn't matter he lacked a "'Sheikh' in front of my name" because FFP would deliver a level playing field. When it was put to him Manchester City, Real Madrid or anyone else will find a way around the Uefa break-even rules, he replied: "You're cynical. If the FFP rules were ridiculous or not that strong, why was the transfer window down 25 per cent last year? The clubs have to comply." His interest in Liverpool "would be less" if that regime were not imminent. Arsenal's own business model is based on similar assumptions.

City's £97.7m losses for the last financial year left them facing a severe challenge to comply with Uefa's FFP targets, which allow accumulative losses of £38m for last season and this. The results also included the first of several puzzling figures in big-spending clubs' accounts – a £13m take for intellectual property sales – which have helped the clubs get nearer to the FFP allowable losses.

City have not yet explained what the £13m covers. Neither have Chelsea explained the £18m "exceptional share profit" item detailed in their accounts, which were released last week. Both items were highlighted by the leading FFP analyst Ed Thompson, author of the website.

These odd figures illustrate what a minefield Uefa faces in satisfying willingly compliant clubs that they are scrutinising the rest. The president of the Qatari-owned Paris Saint-Germain, Nasser Al-Khelaifi, has attempted to justifying the club's extraordinary new commercial partnership with the Qatar Tourism Authority (QTA), which promises to be hugely controversial.

The deal, worth twice the club's revenues for the 2010-11 season, looks like an under-the-counter way of financing the club by PSG's owners Qatar Sports Investments, who, like QTA are tied to the state of Qatar. But if Uefa cannot demonstrate that the deal is a "related party transaction," the governing body cannot challenge the deal.

At Liverpool, Henry is known to be unhappy about the transparency of City's £400m sponsorship deal with the Abu Dhabi airline, Etihad, though there is a strong case to be made for its probity – despite Etihad paying out a world-record sum, having failed to make a profit in its seven years of existence.

Henry's managing director at Anfield, Ian Ayre, said last year that "the rules are rules and should be hard and fast. What will kill the initiative, or certainly stifle it, is people easing themselves into it rather than the rules applying and everyone operating within them".

Though a long way from break-even, City did record a halving of their previous year's losses and are hopeful Uefa will credit them for trying to drive down the losses, before deciding on any sanctions.

Hey big spenders: transfer deals

* Transfer dealings made since Manchester City were taken over by the Abu Dhabi United Group on 1 September 2008:

Man City Expenditure: £515m; Revenue: £124m; Net profit: -£391m

Chelsea Expenditure: £330m; Revenue: £79m; Net profit: -£251m

Liverpool Expenditure: £241m; Revenue: £203m; Net profit: -£38m

Spurs Expenditure: £201m; Revenue: £186m; Net profit: -£15m

Man Utd Expenditure: £197m; Revenue: £141m; Net profit: -£56m

Arsenal Expenditure: £140m; Revenue: £168m; Net profit: +£28m

Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
The Ridiculous Six has been produced by Adam Sandler, who also stars in it
filmNew controversy after nine Native American actors walked off set
Ed Miliband, Nick Clegg and David Cameron appeal to the audience during the Question Time special
Danny Jones was in the Wales squad for the 2013 World Cup
rugby leagueKeighley Cougars half-back was taken off after just four minutes
Life and Style
The original ZX Spectrum was simple to plug into your TV and get playing on
techThirty years on, the ZX Spectrum is back, after a fashion
Tiger Woods and Lindsey Vonn are breaking up after nearly three years together
peopleFormer couple announce separation in posts on their websites
Life and Style
Google celebrates Bartolomeo Cristofori's 360th birthday
techGoogle Doodle to the rescue
Arts and Entertainment
Haunted looks: Matthew Macfadyen and Timothy Spall star in ‘The Enfield Haunting’
tvThe Enfield Haunting, TV review
The Mattehorn stands reflected in Leisee lake near Sunnegga station on June 30, 2013 near Zermatt, Switzerland
Michelle Dockery plays Lady Mary in Downton Abbey
peopleBut who comes top of the wish list?
Miriam Gonzalez Durantez, right, with Lib Dem candidate Jane Dodds in Newtown, Powys, as part of her tour in support of the party’s female candidates
general electionNick Clegg's wife has impressed during the campaign
Caption competition
Caption competition
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

Bleacher Report

Daily Quiz
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living