German football moves towards squad cost limits amid spending concerns

by Oliver Trust

BERLIN, July 25 (Xinhua) -- German professional football is taking steps to implement a squad cost cap across its 36 top-tier clubs, according to multiple media reports. The move is aimed at curbing excessive spending and ensuring long-term financial sustainability.

Under the new regulations, set to take effect from the 2027-28 season, clubs will face sanctions if they spend more than 70 percent of their revenues on player transfers, salaries and agent fees. The limit will be reduced to 50 percent during a transitional phase, with the rules coming into full force the following year.

The German Football League (DFL) has confirmed the plans, which are expected to receive widespread backing from clubs, according to the sports magazine Kicker. A commission including representatives from Borussia Dortmund, Hamburg, RB Leipzig, Bayer Leverkusen, Schalke and Darmstadt is finalizing the details, Sport-Bild reports.

DFL CEO Marc Lenz described the reform as an "advanced form of financial fair play" and said the measures are designed to prevent financial turbulence and unchecked external investment, while maintaining the competitiveness of German clubs.

The new framework aligns with UEFA's financial regulations, which limit clubs to spending 70 percent of their income from TV rights, ticket sales, sponsorship and merchandising on player-related expenses. However, the German model introduces two additional provisions: a clear catalogue of sanctions and a role for clubs' equity capital in determining penalties. Clubs with higher equity reserves may face reduced sanctions.

Potential penalties include fines, point deductions, and transfer bans.

A recent survey by the SLC Management Institute in Nuremberg found that 90.9 percent of fans support the implementation of squad cost limits.

Bayern Munich supervisory board member Karl-Heinz Rummenigge voiced his support in an interview with Gazzetta dello Sport, saying: "It's time to act."

He criticized the current financial practices in football as unsustainable. "Some clubs are already spending over 90 percent of their revenue. That's not healthy."

Rummenigge also called for a uniform European approach to spending control across all major leagues.

Meanwhile, RB Leipzig, winners of the German Cup in 2022 and 2023, has announced it will implement a salary cap of 5 million euros per player, signaling early compliance with the spirit of the upcoming regulations. Enditem