club_licensing_regulations_2010

AFCCLUB LICENSINGREGULATIONSVERSION 01/2010

2AFC Club Licensing Regulations

AFC Club Licensing RegulationsTABLE OF CONTENTSDefinitions 71 Introduction 161.1 Objectives for the AFC Club Licensing System 172 Procedure 192.1 Criteria Graduation 192.1.1 Principle 192.2 Licensing Implementation 202.2.1 Principle 202.2.2 Implementation at National Association Level 202.2.3 Existence of a Legal Basis within the Statutes 202.2.4 Possibility for the National Association to Delegate the ClubLicensing System to an Affiliated League2.2.5 Rules Regarding Sanctions of the National Club LicensingSystem2.2.6 Integration of the AFC Club Licensing Regulations into aNational Club Licensing Regulations for the 2013 Season2.2.7 Exception Process and Policy 232.2.8 Accreditation Process 262.2.9 Decision on the Application of the System to its LicenceApplicants2.3 Spot-Checks by AFC 272.3.1 Principle 272.4 Development Process 282.4.1 Principle 282.5 Bodies of AFC 282.5.1 Principle 2820222227AFC Club Licensing Regulations 3

3 Licensor 303.1 Introduction 303.2 Licensor Definition 303.2.1 Who is the Licensor? 303.2.2 Decision-Making Bodies 303.2.3 Licensing Administration 313.2.4 First Instance Body (FIB) 313.2.5 Appeals Body (AB) 323.2.6 Requirements of Members of the Decision-Making Bodies 323.2.7 Procedure of Decision Making 344 Licence Applicant and Licence 354.1 Introduction 354.2 Circle of Licence Applicants 354.2.1 Authority to Define Licence Applicants 354.2.2 Status of Football Clubs 354.2.3 Legal Form of Football Clubs 354.3 Definition of Licence Applicants 354.3.1 Principle 354.4 Licence 394.4.1 Principle 394.5 Admission to AFC Club Competitions 404.5.1 Principle 404.6 Extraordinary Application of the Club Licensing System for EnteringAFC Club Competitions4.6.1 Principle 404.6.2 Procedure 41404AFC Club Licensing Regulations

AFC Club Licensing Regulations5 Core Process 435.1 Introduction 435.1.1 Principle 436 Sporting Criteria 456.1 Introduction 456.2 Objectives 456.3 Benefits for Clubs 456.4 Criteria 466.4.1 “A” Criteria 466.4.2 “B” Criteria 486.4.3 “C” Criteria 487 Infrastructure Criteria 497.1 Introduction 497.2 Objectives 497.3 Benefits for Clubs 507.4 Criteria 507.4.1 “A” Criteria 507.4.2 “B” Criteria 557.4.3 “C” Criteria 578 Personnel and Administrative Criteria 588.1 Introduction 588.2 Objectives 588.3 Benefits for Clubs 598.4 Criteria 608.4.1 “A” Criteria 608.4.2 “B” Criteria 66AFC Club Licensing Regulations 5

9 Legal Criteria 689.1 Introduction 689.2 Criteria 689.2.1 “A” Criteria 689.2.2 “B” Criteria 719.2.3 “C” Criteria 7110 Financial Criteria 7210.1 Introduction 7210.2 Objectives 7210.3 Benefits 7310.4 Reporting Period and Format 7310.5 Criteria 7410.5.1 Historic Financial Information 7410.5.2 Future Financial Information 7710.5.3 Subsequent Information 7711 Final Provisions 7911.1 Appendices 7911.2 Disciplinary Procedures 7911.3 Implementing Provisions 7911.4 Matters Not Provided For 7911.5 Ratification 79Appendix I Core Process 806AFC Club Licensing Regulations

AFC Club Licensing RegulationsDEFINITIONSDefinitionAccountingpoliciesAFC ClubLicensingManual(Manual)AFC ClubLicensingRegulations(Regulations)AFC ClubCompetitionsAFC SeasonAFC StadiumRegulationAgreed-uponprocedures(AUP)The specific principles, bases, conventions, rules and practicesadopted by an entity in preparing and presenting its financialstatements.Working document which describes the AFC Club LicensingRegulations. The guidelines of the AFC Club LicensingRegulations provide the licensor and licence applicants furtherunderstanding into the reasons behind the criteria as well as astandard interpretation of the criteria and assessment process.In relation to the financial criteria in the Regulations, the Manualalso provides details on mandatory and minimum requirements.The regulations consisting of five categories of criteria and acore process. The requirements of the AFC club licensingregulations must be transferred into a “National Club LicensingRegulations”.AFC Champions League, AFC Cup and/or AFC President’s CupSee Season to be licensedWorking document which describes the requirements to befulfilled by the clubs with regard to the Stadium to be used forAFC club competition matches.In an engagement to perform agreed-upon procedures, anauditor is engaged to carry out those procedures of an auditnature to which the auditor and the entity and any appropriatethird parties have agreed and to report on factual findings. Therecipients of the report must form their own conclusions from thereport by the auditor. The report is restricted to those parties thathave agreed to the procedures to be performed since others,unaware of the reasons for the procedures, may misinterpretthe results.AFC Club Licensing Regulations 7

AmortisationAnnualfinancialstatementsAssociateAssessmentprocessAuditBudgetCashand cashequivalentsThe systematic allocation of the depreciable amount of anintangible asset over its useful life. For example, for thecapitalized direct costs of acquiring a player’s registration, theuseful life is the contract life.A complete set of financial statements prepared as at thestatutory closing date, normally including a balance sheet, profitand loss account, a statement of cash flows and those notes,other statements and explanatory material that are an integralpart of the financial statements.An entity, including an unincorporated entity such as apartnership, over which the investor has significant influence andthat is neither a subsidiary nor an interest in a joint venture.See Core ProcessThe objective of an audit of financial statements is to enable theauditor to express an opinion whether the financial statementsare prepared, in all material respect, in accordance with anidentified financial reporting framework. The phrases used toexpress the auditor’s opinion are “give a true and fair view” or“present fairly, in all material respects”, which are equivalentterms. A similar objective applies to the audit of financial or otherinformation prepared in accordance with appropriate criteria.In an audit engagement, the auditor provides a high but notabsolute, level of assurance that the information subject to auditis free of material misstatement. This is expressed positively inthe audit report as reasonable assurance.The schedules containing an entity’s future financial information,based on management’s assumptions about events that mayoccur in the future and possible actions by an entity.Cash comprises cash on hand and demand deposits. Cashequivalents are short term, highly liquid investments that arereadily convertible to known amounts of cash and which aresubject to an insignificant risk of changes in value.8AFC Club Licensing Regulations

AFC Club Licensing RegulationsConsolidatedfinancialstatementControlCore processCriteriaDeadline forsubmissionof the list oflicensed clubsto AFCDeadline forsubmission ofthe applicationto the licensorDepreciableamountFinancial statements of a group presented as those of a singleeconomic company.The power to govern the financial and operating policies of anentity so as to obtain benefits from its activities.Minimum requirements that the licensor has to put in placefor verification of compliance with the criteria described in theregulations as basis for the issuance of a licence to an applicant.Requirements to be fulfilled by the licence applicant dividedinto five categories (sporting, infrastructure, personnel andadministrative, legal and financial), with each category beingsplit into three grades: A, B, C (mandatory and best practicerecommendation)The date by which each licensor must submit to AFC the list ofclubs that were granted with a licence by the national decisionmakingbodies. This date is defined by AFC each year andannounced to the licensors.The date by which each licensor requires licence applicants tohave submitted all relevant information for its application for alicence.The cost of an asset, or other amount substituted for cost, lessits residual value.Residual value is the estimated amount that an entity wouldcurrently obtain from disposal of the asset, after deducting theestimated costs of disposal, if the asset were already of the ageand in the condition expected at the end of its useful economiclife.AFC Club Licensing Regulations 9

Direct costsof acquiringa player’sregistrationEmployeebenefitsEvent orconditionof majoreconomicimportanceFinancial yearFuturefinancialinformationGoingconcernGroupThose payments to third parties for the acquisition of a player’sregistration, excluding any internal development or other costs.Costs to include:-a) Transfer fee payable for securing the registration;b) Transfer fee levy (if applicable); andc) Other direct costs of obtaining the player’s registration (eg.payments to agents for services to the club, legal fees,compensation payments for training and development ofyoung players in accordance with FIFA and/or domestictransfer regulations and other direct costs in connection withthe transfer).All forms of consideration given by an entity in exchange forservice rendered by employees.An event or condition is of major economic importance if it isconsidered material to the financial statements of the reportingentity and would require a different (adverse) presentation of theresults of the operations, financial position and net assets of thereporting entity if it had occurred during the preceding financialyear of interim period.The financial reporting period ending on the statutory closingdate, whether this is a year or not, and which is not an interimperiod.Information about the prospective financial effects of futureevents and possible actions on the entity concerned.A reporting entity is normally viewed as a going concern,that is, as continuing in operation for the foreseeable future.It is assumed that the entity has neither the intention nor thenecessity of liquidation, ceasing trading nor seeking protectionfrom creditors pursuant to laws or regulations.A parent and all its subsidiaries.A parent is an entity that has one or more subsidiaries. A subsidiaryis an entity, including an unincorporated entity such asa partnership that is controlled by another entity (known as theparent).10AFC Club Licensing Regulations

AFC Club Licensing RegulationsHistoricfinancialinformationIndependentauditorIntangibleassetInterimfinancialstatementsInterim periodInternationalFinancialReportingStandards(“IFRS”)InternationalStandardson Auditing(“ISA”)Information about the financial effects of past events on theentity concerned. Historic financial information is in respect of thefinancial performance and position prior to the licensing decision.An auditor who is independent of the entity, in compliance withthe IFAC Code of Ethics for Professional Accountants. Foradditional information, visit www.ifac.org. The term ‘auditor’ mayalso be used when describing related services or assuranceengagements other than audits.An identifiable non-monetary asset without physical substance,such as the registration of a player.A financial report containing either a complete set of financialstatements or a set of condensed financial statements for aninterim period.A financial reporting period shorter than a full financial year.Standards and Interpretations adopted by the InternationalAccounting Standards Board (IASB). They comprise:-a) International Financial Reporting Standards;b) International Accounting Standards; andc) Interpretations originated by the International FinancialReporting Interpretations Committee (IFRIC) or the formerStanding Interpretations Committee (SIC).The International Auditing and Assurance Standards Board(“IAASB”) issues International Standards on Auditing as thestandards to be applied by auditors in reporting on historicalfinancial information. According to the IAASB, one of its objectivesis ‘establishing high quality auditing standards and guidancefor financial statement audits that are generally accepted andrecognized by investors, auditors, governments, bankingregulators, securities regulators and other key stakeholdersacross the world’.For additional information about the IAASB and ISA, visit www.ifac.orgAFC Club Licensing Regulations 11

InternationalStandardson ReviewEngagements(ISRE)InternationalStandards onRelated Services(ISRS)Joint ventureLicenceLicence applicantLicenseeLicensingadministrationLicensing cycleLicensing seasonLicensing processThe IAASB issues standards applicable to a review ofhistoric financial information. Current ISREs are availablefrom www.ifac.orgThe IAASB issues engagement standard that include theapplication of agreed-upon procedures to information.Current ISRSs are available from www.ifac.org.A contractual arrangement whereby two or more parties (theventurers) undertake an economic activity that is subject tojoint control.Where an entity included in the consolidation managesjointly with another entity not included in the consolidationan economic activity that other entity (Joint Venture) may bedealt with in the Group accounts.Certificate confirming fulfillment of all mandatory minimumrequirements by the licensee in order to start the admissionprocedure for AFC Champions League.Legal entity fully and solely responsible for the football teamparticipating in national and international club competitionswhich applies for a licence.Licence applicant which has been granted with a licence bythe licensor.Body or staff within the licensor that deals with club licensingmatters.See Core processSeason for which a licence has been granted (cf. alsoSeason to be licensed)Process in which a licence is granted12AFC Club Licensing Regulations

AFC Club Licensing RegulationsLicensorManagement(personnel)Material orMaterialityMayMust or shallNationalaccountingpracticeNational ClubLicensingRegulationsParentRecoverableamountBody that operates the national licensing system and grants thelicenceDescribes those responsible for the preparation and fairrepresentation of the financial statements and other financialinformation. Other terms may be appropriate depending on thelegal framework in the particular jurisdiction. For example, insome jurisdictions, the appropriate reference may be ‘to thosecharged with governance’ (for example, the directors).Omissions or misstatements of items or information are materialif they could, individually or collectively, influence the economicdecisions of users taken on the basis of the financial information.Materiality depends on the size and nature of the omissionor misstatement judged in the surrounding circumstances orcontext. The size or nature of the item, or a combination of both,could be the determining factor.Indicates a party’s discretion to do something (ie. optional, ratherthan mandatory)Indicates an obligation to do somethingThe accounting and reporting practices and disclosures requiredof entities in a particular country.Working document which describes the national club licensingsystem in a particular country. It includes all minimumrequirements of the AFC club licensing system as well as anyspecific national particularities and objectives.An entity that has one or more subsidiaries.The higher of an asset’s fair value less costs to sell and its valuein use. ‘Fair value less costs to sell’ is the amount obtainablefrom the sale of an asset in an arm’s length transaction betweenknowledgeable, willing parties, less the costs of disposal. ‘Valuein use’ is the present value of future cash flows expected to bederived from the asset.AFC Club Licensing Regulations 13

RegisteredmemberRelated partyReportingentity/entitiesReviewAny legal entity according to national law and/or nationalassociation statutes, which is member of the national associationand/or its affiliated league.A party is related to an entity if:-a) Directly, or indirectly through one or more intermediaries, theparty:-i) controls, is controlled by, or is under common control withthe entity (this includes parents, subsidiaries and fellowsubsidiaries);ii) has an interest in the entity that gives it significant influenceover the entity; oriii) has joint control over the entity;b) the party is an associate of the entity;c) the party is a joint venture in which the entity is a venturer;d) the party is a member of the key management personnel ofthe entity or its parent;e) the party is a close member of the family of any individualreferred to in (a) or (d);f) the party is an entity that is controlled, jointly controlled orsignificantly influenced by, or for which significant votingpower in such entity resides with, directly or indirectly, anyindividual referred to in (d) or (e); org) the party is a post-employment benefit plan for the benefit ofemployees of the entity, or of any entity that is a related partyof the entity.The registered member and/or company or group which,according to the rules of this regulations, must provide thelicensor with respectively statutory or consolidated financialstatements.The objective of an engagement to review financial informationis to enable an auditor to express a conclusion whether, on thebasis of the review, anything has come to the auditor’s attentionthat causes the auditor to believe that the financial informationis not prepared, in all material respects, in accordance with anidentified financial reporting framework.14AFC Club Licensing Regulations

AFC Club Licensing RegulationsSeason to belicensedSignificantchangeSignificantinfluenceStadiumStatutoryclosing dateSubsequenteventsSubsidiarySupplementaryinformationA review, in contrast to an audit, is not designed to obtainreasonable assurance that the financial information is free frommaterial misstatement. A review consists of making inquiries,primarily of persons responsible for financial and accountingmatters, and applying analytical and other review procedures.A review may bring significant matters affecting the financialinformation to the auditor’s, but it does not provide the evidencethat would be required for an audit.Means the AFC season for which the licence applicant hasapplied for the licence; ie. 1 January – 31 DecemberMeans an event that is considered material to the documentationpreviously submitted to the licensor and that would require adifferent presentation if it had occurred prior to the submission ofthe licensing documentation.The power to participate in the financial and operating policydecisions of the investee but is not control or joint control overthose policies.Means the venue for a competition match including, but notlimited to, all properties and facilities near to such stadium(for example, offices, hospitality areas, press centres andaccreditation centres).The annual accounting reference date of the reporting entity.Events or conditions occurring after the licensing decision.An entity, including an unincorporated entity such as a partnershipthat is controlled by another entity (known as the parent).If the minimum requirements of criterion F.01 for content andaccounting are not met in the audited annual financial statements,additional information must be prepared and submitted bythe licence applicant. The content and presentation of thesupplementary information, if required at all, will vary betweenlicence applicants depending on the amount of informationalready disclosed in the separate audited annual financialstatements.AFC Club Licensing Regulations 15

1. INTRODUCTIONThis “AFC Club Licensing Regulations” is the basic working document for nationalassociations which incorporates the AFC minimum requirements that must betransformed into a “National Club Licensing Regulations”. It comes into force on itsapproval by the AFC Executive Committee and applies for the first time for the 2013season.The AFC Club Licensing Regulations must be read together with the AFC ClubLicensing Manual. The latter provides the licensor and licence applicants with furtherunderstanding into the reasons behind the criteria as well as a standard interpretationof the criteria and assessment process stated in the AFC Club Licensing Regulations.This AFC Club Licensing Regulations is divided into two main sections.The first section addresses the national association as the licensor, explaining itstasks, defining the licence applicant and the licensing bodies as well as the coreprocess to be applied.The second section is directed at the clubs of the national association. The fivecategories of minimum criteria are described in five chapters, which are as follows:sporting criteria, infrastructure criteria, personnel and administrative criteria, legalcriteria and financial criteria. The criteria are divided into three different grades (“A”,“B” and “C”).Each chapter also includes the objectives and the benefits for the clubs. The nationalassociations and clubs should first carefully read through the objectives of eachcategory of criteria.For several criteria, the final wording has to be adapted by the licensor, taking intoaccount the particular situation of the national association, the status of football andits top-division clubs as well as the minimum standards of its current “National ClubLicensing Regulations”.In contrast, AFC lays down some “mandatory”, to ensure a certain unified qualitystandard throughout Asia, as a first step towards the development of Asian football.Some flexibility has been given to the discretion of the national association. In such16AFC Club Licensing Regulations

AFC Club Licensing Regulationscircumstances the regulations shall be individually tailored by each licensor accordingto its specific needs and in compliance with national law.The national associations are invited to:-1. Read and understand the AFC Club Licensing Regulations in conjunction withthe AFC Club Licensing Manual;2. Decide, if the club licensing system applies to the national context (which divisionsor clubs and which criteria);3. Review the format (layout) and structure of the current “National Club LicensingRegulations” and adapt it accordingly, if available;4. Take into account national law, statutes and regulations;5. Adapt its own structure and relevant organisation according to the minimumrequirements regarding the core process and further procedures;6. Consider increasing the minimum criteria set by AFC, and upgrading or addingother criteria for the National Club Licensing Regulations, according to thespecific needs and the existing quality of domestic competitions;7. Exchange opinions and experiences with AFC and other AFC memberassociations;8. Set-up a working plan for the implementation of the new National ClubLicensing Regulations taking into account the AFC deadlines for exceptions andaccreditation as well as the national decision-making process.Each National Club Licensing Regulations will have to be accredited by AFC (cf.2.3.7).1.1 OBJECTIVES FOR THE AFC CLUB LICENSING SYSTEMThe AFC Club Licensing System has the following objectives:-• Safeguarding the credibility and integrity of continental and national clubcompetitions.• Allowing the development of benchmarking for clubs in financial, sporting, legal,personnel, administrative and infrastructure related criteria throughout Asia.• Further promotion and continuous improvement of the standard of all aspectsof football in Asia and continuing priority given to the training and care of youngplayers in each club;• Increasing the level of management and organization within the clubsAFC Club Licensing Regulations 17

2.2 LICENSING IMPLEMENTATION2.2.1 PRINCIPLEThe AFC Club Licensing Regulations must be transformed into national clublicensing regulations which set the minimum criteria for the licensee to enterAFC and/or the national club competitions.2.2.2 IMPLEMENTATION AT NATIONAL ASSOCIATION LEVEL2.2.2.1 The implementation of the club licensing system at national levelincludes the following steps and processes:-a) existence of a legal basis within the statutes (cf. 2.2.3.);b) possibility for the national association to delegate club licensingresponsibilities to an affiliated league (cf. 2.2.4.);c) establishment of rules regarding the sanction of the NationalClub Licensing System (cf. 2.2.5.);d) integration of the AFC Club Licensing Regulations into a NationalClub Licensing Regulations (cf. 2.2.6.);e) possibility for the national association to ask for exceptions(exception process, cf. 2.2.7);f) submission of the national licensing regulations to AFC foraccreditation (accreditation process, cf. 2.2.8.);g) decision on the application of the licensing system to its licenceapplicants (cf. 2.2.9.).2.2.3 EXISTENCE OF A LEGAL BASIS WITHIN THE STATUTES2.2.3.1 For the implementation of the club licensing system within all AFCmember associations, each national association must have a legalbasis within its statutes (cf. FIFA Standard Statutes: Article 76).2.2.3.2 As an alternative the club licensing system can also be based on acontract between the club and the national association.2.2.4 POSSIBILITY FOR THE NATIONAL ASSOCIATION TO DELEGATE THECLUB LICENSING SYSTEM TO AN AFFILIATED LEAGUE2.2.4.1 Under certain conditions (cf. 2.2.4.6), the national association maydelegate the club licensing system to an affiliated league.2.2.4.2 Vis-à-vis AFC, the national association as an AFC member remainsliable and responsible for the proper implementation of the clublicensing system, regardless of whether there is delegation or not.20AFC Club Licensing Regulations

AFC Club Licensing Regulations2.2.4.3 Only the AFC Executive Committee may approve any requestfrom national associations to delegate or to withdraw licensingresponsibilities to/from the affiliated league.2.2.4.4 Such well-founded requests can be made to the AFC administrationat any time. In the event of approval by the AFC Executive Committee,all the requests presented to AFC in writing before the start of thecore process will be considered for effect in the following footballseason of AFC.2.2.4.5 AFC would not accept any delegation request or its withdrawal duringthe core process in order to ensure continuity.2.2.4.6 The AFC Executive Committee may approve the delegation requestsif the national association provides written confirmation that such aleague:-a) is affiliated to the national association and has accepted itsstatutes, regulations and the decisions of its responsible andcompetent bodies, in writing;b) is responsible for running the top domestic championship;c) has submitted a decision by the legislative body of this affiliatedleague to comply with the following obligations towards AFC, inwriting:-i. implementing the AFC club licensing system requirementsaccording to the provisions of the “AFC Club LicensingRegulations” and any future amendments thereto into a“National Club Licensing Regulations”;ii. granting AFC and its nominated bodies/agencies fullnecessary access to verify the operation of the club licensingsystem and the decisions of the decision-making bodies atany time;iii. allowing AFC and its nominated bodies/agencies to conductspot-checks at any time on clubs that qualify for the AFCChampions League competition;iv. accepting any AFC decision made with regard to theexceptions, the accreditation of the club licensing systemand/or spot-checks;v. issuing the appropriate sanction to the parties concernedaccording to AFC’s recommendations or decisions.AFC Club Licensing Regulations 21

2.2.5 RULES REGARDING SANCTIONS OF THE NATIONAL CLUB LICENSINGSYSTEM2.2.5.1 To guarantee an appropriate assessment process, the nationalassociation shall:-a) Set up a catalogue of sanctions for the club licensing system(e.g. for the non fulfillment of B criteria). It pertains to the relevantlicensing bodies to determine these sanctions against the licenceapplicants/licensee.The catalogue of sanctions may include a caution and a fine, etc.If the club licensing system also applies for participation in thenational competitions, the catalogue of sanctions may additionallyinclude the deduction of points, the prohibition to conclude newtransfer agreements or players’ contracts, the obligation to submitsome guarantees, etc. Furthermore, the licensor may sanctionthe club before the start as well as during the season.b) Refer to the national disciplinary regulations for the violation ofthe licensing regulations as such (e.g. submission of falsifieddocuments, non respect of deadlines, sanctions againstindividuals, etc.).2.2.6 INTEGRATION OF THE AFC CLUB LICENSING REGULATIONS INTO ANATIONAL CLUB LICENSING REGULATIONS FOR THE 2013 SEASON2.2.6.1 Each national association defines the parties involved (licensor,licence applicant, decision-making bodies), their rights and duties,the criteria and the necessary processes in accordance with the“AFC Club Licensing Regulations” for entering in the AFC ClubCompetition in its “National Club Licensing Regulations”.2.2.6.2 The transformation of the “AFC Club Licensing Regulations” intoa “National Club Licensing Regulations” has to take place during2010 in view of the AFC Club Competitions in 2013 and includes thefollowing processes which require the approval of AFC:-a) Exception process and policy (cf. 2.2.7 below)b) Accreditation process (cf. 2.2.8 below)2.2.6.3 For the 2013 AFC season the deadline for the submission of anyexception request to AFC is 30 April 2011.22AFC Club Licensing Regulations

AFC Club Licensing Regulations2.2.6.4 For the 2013 AFC season the deadline for the submission of the newNational Club Licensing Regulations to AFC for accreditation is 30April 2011.2.2.6.5 The “AFC Club Licensing Regulations” is structured and worded insuch a manner that the national association can use its full text as amaster document. The national association may adapt the wordingof the AFC Club Licensing Regulations according to:-a) the national associations objectives and priorities;b) the statutes and regulations of the national association;c) national law;d) flexibility given by AFC.Such rewording by the national association is subject to compliancewith the AFC “mandatory” in each category of criteria and the licensingprocess itself. As a principle, for any given criterion, AFC fixes thequality and the national association fixes the quantity according toits needs. AFC gives the national associations some flexibility in thefinalisation of the wording of each single criterion as well as in thedescription of the licensing process for the member clubs. Whereflexibility has been given to the discretion of the national association,the text must be individually tailored by each licensor according to itsspecific needs.2.2.6.6 The national association is responsible for ensuring, and mustdemonstrate to the AFC Administration, that all applicable provisionsof these regulations have been integrated in its national club licensingregulations. Exceptions may be granted by the AFC Administrationaccording to process and policies stated in 2.2.7 below.2.2.7 EXCEPTION PROCESS AND POLICY2.2.7.1 The following exception policy guidelines apply:-a) Only clear and well-founded requests submitted in writing andwithin the given deadline to the AFC by the national associationwill be dealt with;b) The exception will be granted to the national association by AFC;c) Exceptions granted to a national association apply to all clubswhich play within the national association and which qualify fora AFC club competition (AFC Champions League, AFC Cup,AFC President’s Cup) for the season in question. Under specificAFC Club Licensing Regulations 23

circumstances, AFC reserves the right not to apply exceptionsgranted to the national association to a specific individual club(e.g. club participating in the AFC club competitions on a regularbasis);d) The exception period granted is one season. Under specificcircumstances such period may be extended and the nationalassociation may be placed on an improvement plan;e) A renewal of the exception is possible upon new request;f) The status and situation of football within the national associationwill be taken into account when granting an exception. Thesituation encompasses for example:i. size of the country, population, geography, economicbackground;ii. size of the national association (number of clubs, numberof registered players and teams, size and quality of theadministration of the association, etc.);iii. the level of football (professional, semi-professional oramateur clubs and at the level of the association);iv. status of football as a sport within the association andits market potential (average attendance, TV market,sponsorship, revenue potential, etc.);v. stadium ownership situation (club, city/community, etc.)within the association;vi. support (financial and other) from the national, regional andlocal authorities, including the national sports ministry.The AFC Administration acts as the first instance decision-makingbody on exception requests. It guarantees that decisions are madewithin a short deadline and ensures equal treatment within the AFCfamily.2.2.7.2 A request must be well-founded and submitted in writing by thenational association at the latest by November 30 two years precedingthe season to be licensed (this deadline applies for the participationin the AFC season 2014 and onwards – and therefore November 30,2012 is the deadline for application of exception for the AFC season2014 while for the AFC season 2013, see example; cf. 2.2.6.3.).24AFC Club Licensing Regulations

AFC Club Licensing Regulations2.2.7.3 An exception request must be clear and concrete. It may relate to:-a) non-applicability of a minimum requirement concerning thedecision making bodies or process defined in Chapter 3: Licensor,due to national law or any other reason;b) non-applicability of a minimum requirement concerning the coreprocess defined in Chapter 5 due to national law or any otherreason;c) non-applicability of a certain criterion defined in Chapters 6-10due to national law or any other reason;d) non-applicability of a minimum assessment procedure defined inChapters 6-10;e) extension of the introduction period for the implementation of acriterion or a category of criteria in Chapters 6-10.2.2.7.4 The AFC Administration shall use the necessary discretion to grantany exception within the limits of these guidelines set. The proceduremust be done in writing.2.2.7.5 The decision must:-a) be in writing;b) state the reasoning;c) include a deadline/time limit;d) provide transparency for the involved parties subject to respectof confidentiality (e.g. financial aspects);e) be communicated to the AFC member associations (and theaffiliated league in case of delegation) with the reasoning.This must then be referred to in the National Club LicensingRegulations and communicated to all licence applicants;f) include a statement of the rights to appeal.2.2.7.6 Appeals can be lodged against decisions made by the AFCAdministration, or, if applicable, the AFC Executive Committee inwriting before the Court of Arbitration of Sport (CAS) in accordancewith the relevant provisions laid down in the AFC Statutes.2.2.7.7 The Court of Arbitration for Sport (hereafter CAS) in Lausanne isappointed as independent appeals body for the club licensingsystem. Decisions of the CAS are final and binding. The relevantarticles of the CAS and AFC Statutes, Rules and Regulations shallapply.AFC Club Licensing Regulations 25

2.2.8 ACCREDITATION PROCESS2.2.8.1 The national associations finalise the wording of the “NationalClub Licensing Regulations” and send it, in English, to AFC foraccreditation.2.2.8.2 AFC approves the final version of the “National Club LicensingRegulations” through what is known as the “accreditation process”.This process guarantees that in each National Club LicensingRegulations, the AFC “mandatory” criteria and the “mandatory”process steps are implemented at national level accordingly.2.2.8.3 The licensor must confirm, in writing, to AFC that all criteria containedin the “National Club Licensing Regulations” sent to AFC foraccreditation are in compliance with the applicable national law.2.2.8.4 The national club licensing regulations must be approved by thecompetent national bodies and communicated to the licenceapplicants before the start of the licensing process and they cannotbe amended during the latter process, unless duly approved by AFC.2.2.8.5 The AFC Administration reviews the final version of the nationalclub licensing regulations and confirms in writing to the nationalassociation that:-a) the applicable provisions of these regulations for the purposeof entering the AFC Champions League are integrated in thenational club licensing regulations;b) the license issued by the competent national bodies according tothe national club licensing regulations is based on the minimumcriteria set in these regulations;2.2.8.6 AFC specifies the season from which the accredited regulations cancome into force. The national association must have its accreditedregulations approved by its competent body (e.g. ExecutiveCommittee) within a date that allows proper implementation of thenew rules for the season specified by AFC.2.2.8.7 The national associations are free to amend their club licensingregulations at any time. However, for the amended regulationsto come into force, this must first be accredited by AFC. Any newaccreditation request must be submitted in writing by the nationalassociation at the latest by January 31 of the year preceding the26AFC Club Licensing Regulations

AFC Club Licensing Regulationsseason to be licensed (this deadline applies for the participation inthe AFC 2014 season onwards – therefore January 31, 2013 in thisexample; cf. 2.2.6.4.).2.2.8.8 The decision on the accreditation is communicated in writing to thenational association and is final and binding.2.2.9 DECISION ON THE APPLICATION OF THE SYSTEM TO ITS LICENCEAPPLICANTS2.2.9.1 The national association must implement the system for participationin AFC club competitions whenever expressly referred to by specificregulations governing a club competition to be played under theauspices of AFC.2.2.9.2 The national association may also decide to implement the systemfor participation in the top division and/or lower division nationalcompetitions. For this purpose, the national association is free toincrease, decrease, or introduce additional minimum criteria inits club licensing regulations for the purpose of entering the lowerdivision domestic club competitions.2.2.9.3 The quality standards will thereby be improved on a broader basis forthe national championship as well as for AFC club competitions andthe clubs of the same division are treated equally. AFC recommendsthat such decision is attentively evaluated. In particular it is veryimportant that the national associations carefully consider the criteriato be implemented for entering the national competitions, the impactof such decision on the national competition regulations and theconsequences of a licence refusal on national level.2.3 SPOT-CHECKS BY AFC2.3.1 PRINCIPLE2.3.1.1 AFC and/or its nominated bodies/agencies reserve, at any time, theright to conduct spot-checks with the licensors and, in the presenceof the latter, with the applicant club in order to ensure that its licencewas correctly awarded at the time of the final and binding decisionof the licensor. The non-observance of the minimum mandatoryrequirements as defined in the National Club Licensing Regulationsaccredited by AFC may result in sanctions defined by the appropriateAFC body according to the nature and the gravity of the violations.AFC Club Licensing Regulations 27

2.3.1.2 AFC and/or its nominated bodies/agencies reserve the right, at anytime, to conduct spot-checks with the licensors to verify that theminimum requirements defined in the core process (cf. Chapter5) are respected. The non-observance of the minimum mandatoryrequirements may result in sanctions defined by the appropriate AFCbody according to the nature and the gravity of the violations.2.3.1.3 For the purpose of the spot-checks by AFC, in the event of anydiscrepancy in interpretation between the English and the Nationalofficial language in the wording of the National Club LicensingRegulations, the English version is the authoritative text.2.4 DEVELOPMENT PROCESS2.4.1 PRINCIPLE2.4.1.1 The project organisation used by the AFC administration for thedevelopment of the club licensing system will also be used for furtherdevelopments of the system.2.4.1.2 Any changes, clarifications, etc. in relation to the AFC Club Licensingsystem will be communicated to the national associations by AFCcircular letter.2.5 BODIES OF AFC2.5.1 PRINCIPLE2.5.1.1 The bodies through which AFC will act with regard to the clublicensing system shall be:a) the Executive Committee for the approval of this regulations,the exception policy and the delegation requests and any othermatter which is not regulated by this regulations;b) the AFC Administration for the approval of the exception requests,the execution of the spot checks, the accreditation of the NationalClub Licensing Regulations, the extraordinary applicationprocedure to enter AFC club competitions as regulated by theseregulations and all tasks regarding club licensing;c) specific working groups (e.g. legal working group, financialworking group, etc.) composed by specialists delegated by thelicensors, may be set up, to assist the AFC Administration in thedevelopment of the club licensing system;28AFC Club Licensing Regulations

AFC Club Licensing Regulationsd) the AFC Judicial Bodies for the penalisation of breaches of dutiesrelating to the “AFC Club Licensing Regulations” and certaindecisions on the spot check result (cf. 2.3). The AFC DisciplinaryCode and the corresponding AFC competition regulations apply.AFC Club Licensing Regulations 29

3. LICENSOR3.1 INTRODUCTIONThis chapter defines the licensor and the decision-making bodies.3.2 LICENSOR DEFINITION3.2.1 WHO IS THE LICENSOR?3.2.1.1 The national association is the licensor. Under certain conditions,the national association may delegate club licensing system to anaffiliated league (cf.2.2.3.)3.2.1.2 The licensor governs the licensing system, appoints the correspondinglicensing bodies and fixes the necessary processes.3.2.1.3 The licensor shall ensure that all applicable provisions defined in theseregulations are integrated into national club licensing regulations thatmust be submitted, in English, to the AFC Administration for reviewaccording to procedures defined in Chapter 2.3.2.1.4 The licensor guarantees the licensee full confidentiality with regardto all information given by the licence applicant during the licensingprocess. Anyone involved in the licensing process or appointed bythe licensor must sign a confidentiality clause before starting itstasks.3.2.1.5 In particular, the licensor must:-a) establish at least two decision-making bodies (cf. 3.2.2);b) establish an appropriate licensing administration (cf. 3.2.3);c) set up a catalogue of sanctions (cf. 2.2.5);d) define the core process (cf. Chapter 5);e) determine whether a licence can be granted.3.2.2 DECISION-MAKING BODIES3.2.2.1 The licensor shall establish two decision-making bodies, the namesof which it shall be determined:-a) First Instance Body (FIB)b) Appeals Body (AB)3.2.2.2 The decision-making bodies shall be independent from each other.They shall receive administrative support from the administration ofthe licensor (cf. 3.2.3).30AFC Club Licensing Regulations

AFC Club Licensing Regulations3.2.3 LICENSING ADMINISTRATION3.2.3.1 The licensor shall establish an appropriate administration and appointits qualified staff members.3.2.3.2 The tasks of the Licensing administration (LA) will include:-a) preparing, implementing and further developing the club licensingsystem;b) providing administrative support to the decision-making bodiesreferred to in 3.2.2.3 above;c) assisting, advising and monitoring the licensees during theseason;d) serving as the contact point for and sharing expertise with thelicensing departments of other AFC member associations andwith AFC itself.3.2.3.3 The LA must be equipped with suitably qualified staff and thenecessary infrastructure. These costs are borne by the licensor.3.2.3.4 At least one staff member or an external financial adviser musthave a financial background and a diploma in accountancy/auditingrecognised by the appropriate national body (e.g. national tradeassociation), or must have several years experience in the abovematters (a “recognition of competence”).3.2.3.5 All persons involved in the licensing process must comply withstrict confidentiality rules regarding information received duringthe licensing procedure. The national association shall set up thenecessary confidentiality clauses in this respect.3.2.4 FIRST INSTANCE BODY (FIB)3.2.4.1 The FIB decides on whether a licence should be granted to anapplicant on the basis of the documents provided and in accordancewith the provisions of the National Club Licensing Regulations at thesubmission deadline set by the licensor and on whether a licenceshall be withdrawn.3.2.4.2 In the case of a licence refusal, the decision must be put in writingand include the reasoning.3.2.4.3 The licensor decides on the quorum of the FIB. The quorum must beof minimum three members. The chairman has the casting vote.AFC Club Licensing Regulations 31

3.2.5 APPEALS BODY (AB)3.2.5.1 The AB decides on appeals submitted in writing and makes a finaland binding decision on whether a licence should be granted.3.2.5.2 Appeals may only be lodged by:-a) The licence applicant, who received the refusal of the FIB;b) The licensee, whose licence has been withdrawn by the FIB; orc) The licensor, the competent body of which must be defined (e.g.Licensing Manager).3.2.5.3 The AB makes its decision based on the decision of the FIB andall the evidence provided by the licence applicant or licensor withits written request for appeal within the deadline determined in theappeal procedure (cf. 3.2.7) by the chairman of the AB.3.2.5.4 Any further evidence submitted to the AB at a later stage shall not betaken into account.3.2.5.5 In the case of a licence refusal, the decision must be put in writingand include the reasoning.3.2.5.6 If a national association has a court of arbitration specified in itsstatutes, it shall decide on whether the club licensing system comesunder its authority. In this respect, particular attention will be paid tothe relevant deadlines for entering the AFC club competitions.3.2.5.7 The Executive Committee of the national association, unlessotherwise provided by the Statutes, decides on the composition ofthe AB.3.2.5.8 The licensor decides on the quorum for the decisions of the AB. Thequorum must be of minimum three members. The chairman has thecasting vote.3.2.6 REQUIREMENTS OF MEMBERS OF THE DECISION MAKING BODIES3.2.6.1 The Executive Committee of the national association decides if themembers of the FIB and AB are elected or appointed. Members maybe re-elected or re-appointed for specific terms to be specified.3.2.6.2 The decision making bodies must have at least one qualified lawyerand an auditor holding a qualification recognised by the appropriatenational professional body among their members.3.2.6.3 Members of the FIB may not belong simultaneously to a statutoryjudicial body of the licensor and must act impartially in the dischargeof their duties.32AFC Club Licensing Regulations

AFC Club Licensing Regulations3.2.6.4 The licensor may nominate administrative staff of the nationalassociation and its affiliated league as members of the FIB, with theexception of the Licensing Manager who cannot be member of theFIB.3.2.6.5 Administrative staff of the national association and its affiliatedleague cannot be members of the AB.3.2.6.6 Members of the AB must not simultaneously be members of anyother statutory body or Committee of the licensor (i.e. other than thebodies mentioned in 3.2.6.2. below).3.2.6.7 Members of the decision making bodies must follow the strictconfidentiality rules in the same way as members of the LA (cf.3.2.3.4). The national association defines these rules and themembers have to accept them in writing.3.2.6.8 In addition to the requirements set out in 3.2.6.1 above, the licensormay establish further conditions to be satisfied by members of thelicensing bodies (academic, professional training, experience, etc.)to ensure that they perform their functions to high professionalstandards.3.2.6.9 A member must in all cases automatically abstain if there is anydoubt as to his/her independence towards the licence applicant or ifthere is a conflict of interest.3.2.6.10 In this connection, the independence of a member may not beguaranteed if he/she or any member of his/her family (spouse,children, parents, siblings) is a:a) memberb) shareholderc) business partnerd) sponsor ore) consultant, etc.of the licence applicant. The foregoing list is illustrative and notexhaustive.3.2.6.11 The licensor may establish further criteria regarding the independenceof members in accordance with AFC.AFC Club Licensing Regulations 33

3.2.7 PROCEDURE OF DECISION MAKING3.2.7.1 In the National Club Licensing Regulations or in a specific regulation,the licensor shall define procedural rules with respect to decisionmaking (cf. 5.1.1.3.). These shall, as a minimum, regulate thefollowing standards:-a) Deadlines (e.g. submission deadline, etc.)b) Safeguarding the principle of equal treatmentc) Representation (e.g. legal representation, etc.)d) The right to be heard (e.g. convocation, hearing)e) Official language (if applicable)f) Time limit to issue a request (e.g. calculation, compliance,interruption, extension)g) Time limit to appealh) Effects of appeal (e.g. no delaying effect)i) Type of evidence requestedj) Burden of proof (e.g. licence applicant has burden of proof)k) Decision (e.g. in writing with reasoning, etc.)l) Ground for complaintsm) Content and form of pleadingn) Deliberation / hearingso) Cost of procedure / administrative fee / deposit34AFC Club Licensing Regulations

AFC Club Licensing Regulations4. LICENCE APPLICANT AND LICENCE4.1 INTRODUCTIONThis chapter defines the legal entity that must apply for the licence and the licence toenter AFC club competitions.The legal entity applying for a licence is called the licence applicant. Once the licenceapplicant has been granted with a licence by the licensor it becomes a licensee. Forthe purpose of this chapter, only the term licence applicant is used.4.2 CIRCLE OF LICENCE APPLICANTS4.2.1 AUTHORITY TO DEFINE LICENCE APPLICANTS4.2.1.1 The licensor defines the licence applicants according to the statutesand regulations of the national association, the following provisionsand in accordance with the national law. This may be regulatedwithin the licensing regulations and/or in the statutes of the nationalassociation and/or in the respective specific national regulations.Furthermore, the FIFA and AFC statutes as well as relevantregulations must also be taken into account (e.g. FIFA Regulationsfor the Status and Transfer of Players).4.2.2 STATUS OF FOOTBALL CLUBS4.2.2.1 The status of a football club (professional, semi-professional oramateur) is not relevant to the issuance of a licence.4.2.3 LEGAL FORM OF FOOTBALL CLUBS4.2.3.1 The legal form of a football club is not relevant to the issuance of thelicence according to national statutes and law.4.3 DEFINITION OF LICENCE APPLICANTS4.3.1 PRINCIPLE4.3.1.1 The licence applicant is defined as being the legal entity fullyresponsible for the football team participating in national andinternational club competitions and which is either:-a) any legal entity according to national law and/or nationalassociation statutes, which is member of the national associationand/or its affiliated league, orAFC Club Licensing Regulations 35

) any commercial entity according to national law and/or nationalassociation statutes, which has a contractual relationship to aregistered member (hereafter, company).4.3.1.2 Only a registered member or a company can apply for / receive alicence. Natural persons may not apply for / receive a licence.4.3.1.3 The licence applicant is fully responsible for the participation innational and international football competitions as well as for thefulfilment of the club licensing criteria.4.3.1.4 The licence applicant is, in particular, responsible for ensuring thefollowing:-a) that all players are registered with the national association and/or its affiliated league and, if professional players, that they havea written labour contract with either the registered member orthe company (see Article 2 and 5 of the FIFA Regulations for theStatus and Transfer of Players);b) that all the compensation paid to the players arising fromcontractual or legal obligations and all the revenues arisingfrom gate receipts are accounted for in the books of either theregistered member or the company;c) that the licence applicant is fully responsible for the football teamcomposed of registered players participating in national andinternational competitions;d) that the licensor is provided with all necessary information and/ordocuments relevant to proving that the licensing obligations arefulfilled, as these obligations relate to the sporting, infrastructure,personnel and administrative, legal and financial criteria set outunder Chapters 6, 7, 8, 9 and 10 respectively;e) that the licensor is provided with information on the reportingentity/entities in respect of which sporting, infrastructure,personnel and administrative, legal and financial information arerequired to be provided (cf. 4.3.1.5, 4.3.1.6 and 4.3.1.7 below). Inturn, the licensor must assess whether, in respect of each licenceapplicant, the selected reporting entity/entities is appropriate forclub licensing purposes.36AFC Club Licensing Regulations

AFC Club Licensing Regulations4.3.1.5 If the licence applicant is a company, it must provide a written contractof assignment with a registered member that must be approved bythe national association and/or its affiliated league and must includethe following minimum content:-a) The company shall comply with the applicable statutes,regulations and decisions of FIFA, AFC, the national associationand the league as amended from time to time. This system ofrules shall constitute an integral part of the contract of assignment.This company shall also comply with decisions made by the saidfootball bodies.b) The company must not further assign the rights to participate tothe competition on national or international level.c) The right of this company to participate in the competitionoperations shall cease to apply if the assigning club’s membershipof the association ceases.d) If the company is put into bankruptcy or enters into liquidationthe right to apply for a licence in the international and/or nationalcompetition shall revert to the registered member. For the sakeof clarity should the licence already be granted to the company,then it cannot be transferred from the company to the registeredmember (cf. 4.4.1.8.); only the right to apply for a licence in thefollowing season shall revert to the registered member.e) The national association shall be reserved the right to approvethe name under which the company participates in the nationalcompetitions.f) The company shall, on request of the competent national orinternational arbitration tribunal, provide views and information,as well as documents on matters regarding the company’sparticipation in the national and/or international competition.g) Confirmation (e.g. share register) of the fact that the registeredmember has the majority of the voting rights of the company. Thecompany may not be owned directly or indirectly by anyone whoalso has a decisive influence over another registered memberor company entitled to participate at the same level in theassociation leagues system.AFC Club Licensing Regulations 37

h) The contract of assignment and any amendment to it shall beapproved by the appropriate body of the national association tobecome valid.4.3.1.6 If the licence applicant is a company it must provide the licensor withthe financial information of the company and the registered member(e.g. consolidated financial statements as if they were a singlecompany).4.3.1.7 If the licence applicant has control on any subsidiary, thenconsolidated financial statements shall be prepared and submittedto the licensor as if the entities included in the consolidation (“thegroup”) were a single company.4.3.1.8 If the licence applicant is controlled by a parent, which may becontrolled by another parent or which may have control over anyother subsidiary or may exercise significant influence over any otherassociate, any transaction with the parent of the licence applicantor any parent or subsidiary or associate of such parent must bedisclosed in the notes to the financial statements to draw attentionto the possibility that its financial position and profit or loss may havebeen affected by the existence of related parties and by transactionsand outstanding balances with such parties.4.3.1.9 In addition to the above-mentioned mandatory provisions, AFCrecommends the following guidelines for national associations todefine the licence applicant. In accordance with these guidelines, thelicence applicant should:-a) be based legally in the territory of the national association and playits home matches only in that territory. The national associationmay define exceptions, subject to the approval of FIFA and AFC;b) have the right to use the name and the brands of the club andnot change the name of the club for advertising/promotionalpurposes;c) accept no clauses in contracts with television, sponsors or othercommercial partners which could restrict the club in its freedomof decision or affect its management.38AFC Club Licensing Regulations

AFC Club Licensing Regulations4.4 LICENCE4.4.1 PRINCIPLE4.4.1.1 Licences must be issued according to the provisions of the accreditedNational Club Licensing Regulations.4.4.1.2 The licensor must issue an invitation to the football clubs concernedto apply for a licence punctually and in writing. The club applying fora licence (i.e. licence applicant) must submit a written application tothe licensor. In this application, the club must, in particular, declarethat it will fulfil the obligations of the licensing system.4.4.1.3 Only clubs which fulfil the criteria set out in the accredited NationalClub Licensing Regulations at the deadlines defined by AFC andwhich have qualified on the basis of their sporting results, may begranted with a licence by the national association to enter the AFCclub competitions of the coming season.4.4.1.4 A licence expires without prior notice:-a) at the end of the season for which it was issued for; orb) on the dissolution of the division in question.4.4.1.5 A licence may be withdrawn during a season by the national decisionmaking bodies if:-a) for any reason a licensee becomes insolvent and enters intoliquidation during the season, as determined by the applicablenational law (where a licensee becomes insolvent but entersadministration during the season, for so long as the purposeof the administration is to rescue the club and its business, thelicence should not be withdrawn);b) any of the conditions for the issuing of a licence are no longersatisfied; orc) the licensee violates any of its obligations under the NationalClub Licensing Regulations.4.4.1.6 As soon as a licence withdrawal is envisaged the national associationmust inform AFC.4.4.1.7 If a club has its licence withdrawn, a decision concerning theelimination of the club from the current AFC competition in questionmust be made by the AFC Judicial Bodies.4.4.1.8 A licence cannot be transferred.AFC Club Licensing Regulations 39

4.4.1.9 AFC reserves the right to sanction a club or eliminate a club fromthe future AFC club competitions based on the applicable AFC clubcompetition regulations and AFC Disciplinary Code.4.5 ADMISSION TO AFC CLUB COMPETITIONS4.5.1 PRINCIPLE4.5.1.1 The licence applicant must further fulfill all the requirements accordingto the relevant AFC club competition regulations to be admitted to theAFC club competition.4.5.1.2 The admission process falls under the sole jurisdiction of AFC and itscompetent bodies (Competitions Committee, etc.).4.5.1.3 The competent bodies of AFC make the final decision regarding theadmission of a club to participate in any AFC club competition.4.5.1.4 Such decisions are subject to all the statutes-based jurisdictionof AFC including the Court of Arbitration for Sport in Lausanne asordinary court of arbitration (Art 61 ff AFC Statutes).4.6 EXTRAORDINARY APPLICATION OF THE CLUB LICENSINGSYSTEM FOR ENTERING AFC CLUB COMPETITIONS4.6.1 PRINCIPLE4.6.1.1 If a club qualifies for an AFC competition based on its sportingresults, but has not undergone at all a national licensing processor has undergone a licensing process which is lower/not equivalentto the one applicable for top division clubs because it belongs toa division other than the top division, the national association ofthe club concerned may - on behalf of such a club - request theextraordinary application of the club licensing system.4.6.1.2 In practice, such a club could for example be the winner or the runnerupof the main domestic cup or league cup playing in a division otherthan the top division.4.6.1.3 Based on such an extraordinary application, AFC may grant specialpermission to enter the corresponding AFC club competition, whichonly applies to that specific applicant and for the season in question.40AFC Club Licensing Regulations

AFC Club Licensing Regulations4.6.2 PROCEDURE4.6.2.1 The AFC General Secretary defines the minimum criteria for theextraordinary procedure and communicates these criteria to thenational associations by February 28 of the year preceding theseason to be licensed at the latest.4.6.2.2 The concerned national association must notify AFC of the possibilityof such extraordinary application in writing, by September 30 at thelatest, stating the name(s) of the club(s) concerned.4.6.2.3 The AFC Administration may then decide the minimum criteria forthe club(s) concerned by taking into account the requirements of theapplicable national club licensing regulations, as well as the status ofthe club(s) in question. The AFC Administration defines as well thenecessary deadlines and forward these to the concerned nationalassociation.4.6.2.4 The national association in question is responsible for submittingthe criteria, as soon as these are communicated by the AFCAdministration, to the club(s) concerned for the assessment for theextraordinary procedure at national level. It also has to take immediateactions with the club(s) for the preparation of that procedure.4.6.2.5 The club(s) concerned must provide the necessary documentaryproof to the national association. The licensor will assess the club(s)against the fixed minimum standards and forward the followingdocumentation in English to AFC within the given deadline:-a) a written request to apply for special permission to enter thecorresponding AFC club competition;b) a recommendation by the licensor based on its executedassessment (incl. the dates and names of the persons havingassessed the club(s));c) all documentary evidence provided by the club(s) and thelicensor;d) any further document requested by AFC during the extraordinaryprocedure.AFC Club Licensing Regulations 41

4.6.2.6 The AFC Administration bases his decision on the receiveddocumentation and grants special permission to enter AFC clubcompetitions if all the set criteria are fulfilled and if the club(s)ultimately qualifies on the basis of its sporting results. The decisionwill be communicated to the national association, which has toforward it to its concerned club(s).4.6.2.7 If a concerned club is sportingly eliminated during this extraordinaryprocedure, the national association has to notify the AFCadministration immediately, and has to decide if this procedureshall immediately be terminated, without further decision. Such aterminated procedure cannot be restarted at a later stage.4.6.2.8 With regard to an appeal of such a decision, reference is to be madeto points 2.2.7.64.6.2.9 AFC reserves the right to execute spot-checks (cf. 2.3.)42AFC Club Licensing Regulations

AFC Club Licensing Regulations5. CORE PROCESS5.1 INTRODUCTIONThis chapter defines the assessment process (hereafter core process) of the clublicensing system.5.1.1 PRINCIPLE5.1.1.1 In its national club licensing regulations, the licensor defines the coreprocess for the verification of the criteria described in this regulations(sporting criteria, infrastructure criteria, personnel and administrativecriteria, legal criteria and financial criteria) and thus to control theissuance of a licence to a licence applicant.5.1.1.2 The core process shall start at the deadline defined by the licensorand shall end with the submission of the list of licensing decisions tothe AFC Administration within the deadline communicated by AFC.5.1.1.3 The core process is aimed at:-a) helping the licensor in establishing an appropriate and efficientlicensing process according to its needs and organisation;b) agreeing on the main requirements that the licensor has tocomply with to issue the licence, necessary for entering AFC clubcompetitions;c) ensuring that the decision on the granting of a club licence ismade by an independent body (FIB and/or AB cf. 3.2.);d) ensuring that the decision-making bodies receive adequatesupport from the licensing administration of the licensor.5.1.1.4 The core process must, as a minimum, include the followinginformation (an example is provided in Appendix I) and be supportedby a timetable (AFC recommends that the deadlines are fixed atthe beginning of the season and be communicated to the licenceapplicants via circular letter):-a) Submission of the licensing documentation to the licenceapplicants;b) Deadlines for submission and submission of the licensingdocumentation to the licensor in order to prove compliance withthe licensing criteria;AFC Club Licensing Regulations 43

c) The procedure with regard to the assessment of thedocumentation by the licensing administration (e.g. personsinvolved, inspections, site visits, etc.; cf. 3.2.2 and 3.2.3);d) Submission of the written representation letter to the licensor (cf.10.5.1);e) Assessment by the decision-making bodies in accordance to theprocedure with regard to the decision making (cf. 3.2.7.);f) Submission of the list of licensing decisions to the AFCAdministration.5.1.1.5 The licensor must submit to AFC the list of licensed clubs within thedeadline communicated by AFC. Communication of this deadlineto the national associations is done by November 31 of the yearpreceding the season to be licensed at the latest.5.1.1.6 The licensor shall ensure equal treatment between all licenceapplicants during the core process.44AFC Club Licensing Regulations

AFC Club Licensing Regulations6. SPORTING CRITERIA6.1 INTRODUCTIONFor the future of football it is absolutely necessary to have a broad basis of footballersavailable who have the necessary skills and motivation to become professionalplayers. Therefore, it is important to foster youth development programmes and toattract into football more and better-educated boys and girls who not only play thegame but are also supporters.6.2 OBJECTIVESThe objectives of the sporting criteria are that licence applicants:-• invest in quality-driven youth development programmes;• support football education and encourage non-football education of their youthplayers;• foster medical care of their youth players;• apply fair play on and off the pitch (including a common understanding ofrefereeing matters among all those involved in a match such as referees, players,coaches and officials).6.3 BENEFITS FOR CLUBSThe first and main advantage of the sporting criteria is to “produce” football talents forthe club’s first squad every year. They also normally fit more easily and quickly intothe first team squad since they have partly trained with them, know their tactics andspeak the same language. They lack only experience.In light of the FIFA transfer system, clubs which have trained players under 23 andwho are then transferred internationally receive financial compensation. Clubs willthus receive a return on their investment if they train young players. Programmesfor improving relations and respect between coaches, officials, players and refereessupport the idea of fair play on and off the pitch. The image of the players and clubswill improve and on the other hand fines for disciplinary sanctions could be reduced.AFC Club Licensing Regulations 45

6.4 CRITERIA6.4.1 “A” CRITERIANo. Grade DescriptionS.01 A APPROVED YOUTH DEVELOPMENT PROGRAMMEThe licence applicant must have a written youth developmentprogramme approved by the licensor. This education programmemust include at least the following:-a) Objectives and youth development philosophy;b) Organisation of youth sector (organisational chart; bodiesinvolved, relation to licence applicant, youth teams etc.);c) Personnel (technical, medical and administrative etc.) andrequired minimum qualifications;d) Infrastructure available for youth sector (training and matchfacilities, others);e) Financial resources (available budget, contribution by licenceapplicant, players or local community etc.);f) Football education programme for the different age groups(playing skills, technical, tactical and physical);g) Education programme on the “Laws of the game”;h) Medical support for youth players (incl. medical checks);i) Review and feedback process to evaluate the results and theachievements of the set objectives;j) Validity of the programme (at least 3 years but maximum 7years).The youth development programme must further show thecommitment and support of the licence applicant for mandatoryand complementary school education of youth players through theintroduction of the following mandatory provisions:-46AFC Club Licensing Regulations

AFC Club Licensing RegulationsThe youth development programme must further show thecommitment and support of the licence applicant for mandatoryand complementary school education of youth players through theintroduction of the following mandatory provisions:-a) the licence applicant ensures that every youth player involvedin its youth development programme has the possibility tofollow the mandatory school education according to nationallaw;b) the licence applicant ensures that every youth player involvedin this youth development programme is not prevented fromcontinuing his non-football education (complimentary schooleducation or profession).No. Grade DescriptionS.02 A YOUTH TEAMSThe licence applicant must at least have the following youth teamswithin its legal entity or affiliated to its legal entity:-a) at least two youth teams within the age range of 15 to 21;b) at least one youth team within the age range of 10 to 14;c) at least one team below the age of 10.The youth teams in the above age ranges litera a) and litera b)must take part in official competitions or programmes recognisedby the national association and played on national, regional orlocal level. Each youth player of those teams must be registeredeither on national and/or on regional level.There is no obligation for the youth teams in children football (literac above) to take part in official competitions. For these teamssuitable events should be organised (mini-tournaments, youthgatherings on local level etc.) in order to provide fun and givethem the opportunity to gain experience playing with other childrenteams. No mandatory registration of these players is required.AFC Club Licensing Regulations 47

No. Grade DescriptionS.03 A MEDICAL CARE OF PLAYERSThe licence applicant must ensure that all its players eligible to playfor its first squad undergo a yearly medical examination, includinga cardiovascular screening.No. Grade DescriptionS.04 A WRITTEN CONTRACT WITH PROFESSIONAL PLAYERS6.4.2 “B” CRITERIANo. Grade DescriptionAll licence applicants’ professional players must have a writtencontract with the licence applicant in accordance with the relevantprovisions of the FIFA Regulations for the Status and Transfer ofPlayers and shall incorporate all key provisions required by thenational law and FIFA, AFC and National Association’s instructions.S.05 B REFEREEING MATTERS AND LAWS OF THE GAME6.4.3 “C” CRITERIANo. Grade DescriptionThe licence applicant must prove that at least the captain or hisreplacement, the head coach or the assistant coach of the firstsquad have attended a session or an event for refereeing mattersprovided by the national association or with its collaboration duringthe year prior to the season to be licensed. The criterion is fulfilledif those persons have attended the session or event.S.06 C RACIAL EQUALITY PRACTICEIt is recommended that the licence applicant establishes a policy totackle racism in football.48AFC Club Licensing Regulations

AFC Club Licensing Regulations7. INFRASTRUCTURE CRITERIA7.1 INTRODUCTIONSeveral regulations, guidelines and directives refer to criteria with regard to thestadium and to the related safety and security (Laws of the Game, AFC competitionregulations, AFC Stadia Regulations, FIFA book for Football Stadiums – TechnicalRecommendations and Requirements.Based on these experiences, AFC decided to streamline the infrastructure approachfor AFC competitions by creating a specific “AFC Stadia Regulation”, which includesall minimum standards as “must-requirements” in one single document. Specific tothe AFC Club Competitions, reference is made to the “AFC Stadia Regulation forAFC Champions League / AFC Cup”.Because the infrastructure criteria should be seen as long-term investments, severalrecommendations have been introduced which must be taken into consideration ifa stadium is to be built or renovated in the short term (one to three years). Theserecommendations will probably be essential requirements for stadiums one day.Therefore, it would be appreciated if the recommendations were either alreadyincorporated into the stadium planning or stadium adaptations began right away inorder to improve quality standards on a voluntary basis.The national law also needs to be taken into consideration when establishing thestadium and security requirements.7.2 OBJECTIVESThe objectives of the following infrastructure criteria are that:-• licence applicants have an “approved” stadium available for playing AFCclub competitions matches which provide spectators and media and pressrepresentatives with well equipped, well appointed and safe and comfortablestadia;• licence applicants have suitable training facilities for their players to help themimprove their technical skills.AFC Club Licensing Regulations 49

7.3 BENEFITS FOR CLUBSIt is appreciated that nowadays people only follow events that are attractive,entertaining and are worth spending a certain amount of money on. A match betweentwo football teams is no longer enough to bring people into a football stadium towatch a match live.Therefore, each club, together with the stadium owner and the local community, shouldtry to provide a stadium that is attractive to visit, safe and secure, easily accessibleby car (including parking facilities) and/or public transport, has comfortable seatswith a close view of the pitch, clean hospitality facilities and shops, is equipped withhygienic and spacious toilets for both sexes, provides communication installations(loudspeakers and a video screen) and, has also seats and toilets for disabledspectators.Higher quality standards and better facilities create more business opportunitiesand therefore more income for the owner and/or the club, which helps to financeinvestments in stadium facilities. Finally, the comfort of a stadium is an importantelement in terms of having a large crowd to support the teams on the pitch.7.4 CRITERIA7.4.1 “A” CRITERIANo. Grade DescriptionI.01 A APPROVED STADIUMS FOR AFC CLUB COMPETITIONSThe licence applicant must have a stadium available to play AFCclub competitions. The licence applicant either:-a) owns the stadium, orb) can provide a written contract with the owner(s) of the stadiumor with owners of different stadia it will use. This contract mustguarantee the use of the stadium for the AFC home matchesfor the coming season, for which the licence applicant qualifiesin sporting terms.50AFC Club Licensing Regulations

AFC Club Licensing RegulationsThe stadia must also meet the requirement expressly referredto by specific regulations governing the use of a stadia in a clubcompetition to be played under the auspices of AFC.The stadium must be approved by the national association.Furthermore it must be based within the territory of the nationalassociation.No. Grade DescriptionI.02 A STADIUM – CERTIFICATION (cf. Art. 1, AFC Stadia Regulationsfor ACL/AFC Cup)The stadium must be certified.The certification is defined according to national/local law andmust include provisions related to safety and an evacuation plan.If such law does not exist, the licensor shall establish the contentof the stadium certificate and the procedure in close cooperationwith the appropriate body/bodies (e.g. local security authorities,the local hospital, fire brigade, police, etc.).The certificate must provide at least the following information:-a) Safety status of the stadium structure and measures forimprovement.b) Compliance statement regarding the safety/security regulationsof the competent civil authority (reference I.06).c) Approval of the entire stadium capacity (individual seats,terraces and total number).d) Safety and security strategy. This must cover all aspects of theorganisation of a football match, such as ticketing distributionsystem, screening of spectators, segregation strategy, crowddispersal strategy, medical service, measures taken in case offire, loss of power supply, or any other emergency.The certificate issued by the appropriate body must not be olderthan two years at the beginning of the new AFC club competitionseason (1st qualification match).AFC Club Licensing Regulations 51

No. Grade DescriptionI.03 A STADIUM – CONTROL ROOM (cf. Art. 38 of the AFC StadiaRegulations for ACL/AFC Cup)Each stadium must have a control room which ensures an overallview of the inside of the stadium in accordance with the provisionsof the applicable law or according to the requirements of thelicensor, in consultation with the appropriate civil body (e.g. localpolice).The provisions shall specify at least:-a) the definition of the size of the control room,b) its configurationc) its furnishingsd) and the technical equipment (e.g. central telephone Switchboard)of the control room.No. Grade DescriptionI.04 A STADIUM – SPECTATOR AREAS (cf. Art. 29 of the AFC StadiaRegulations for ACL/AFC Cup)Each stand within the stadium must be capable of being dividedinto separate sectors according to the requirements of the localsecurity authorities or, if no such requirements exist, those of thelicensor.No. Grade DescriptionI.05 A STADIUM – FIRST AID ROOMS (cf. Art. 36 of the AFC StadiaRegulations for ACL/AFC Cup)Each stadium must be equipped with first-aid room(s) to carefor spectators in need of medical assistance. This must be doneaccording to the local authority regulations, or the licensor fixesthe exact number, size and location of the first-aid room(s) inconsultation with the appropriate civil body (e.g. local authoritiesfor security and health).52AFC Club Licensing Regulations

AFC Club Licensing RegulationsIn general terms, the licensor may take account of the followingrecommendations:-a) The first-aid rooms must be located in a position which allowseasy access from both inside and outside the stadium tospectators and emergency vehicles.b) Have doors and passageways leading to them which are wideenough to allow access for a stretcher or a wheelchair.c) Have bright lighting, good ventilation, heating, air conditioning,electric sockets, hot and cold water, drinking water and toiletfacilities for men and women.d) Have walls and floors (non-slip) constructed of smooth andeasy to clean material.e) Have a glass cabinet for medicine.f) Have storage space for stretchers, blankets, pillows and firstaidmaterials.g) Have a telephone allowing internal and external communication.h) Be clearly signposted throughout the inside and outside of thestadium.No. Grade DescriptionI.06 A STADIUM – SAFETYIn accordance with the national law, the following provisions maybuild an integrated part of the stadium certificate. If no such lawexists, the licensor defines at least the following provisions:-a) All parts of the stadium and its stands, including entrances, exits,stairways, doors, passages, roofs, all public and private areasand rooms, etc. must comply with the safety standards (referenceI.04).b) All public passageways and stairways in the spectator areasmust be painted in a bright colour (e.g. yellow), as must all gatesleading from the spectator areas into the playing area, and all exitdoors and gates leading out of the stadium.c) Clubs must establish procedures so that all public passageways,corridors, stairs, doors, gates, etc. are kept free of any obstructionsthat could impede the free flow of spectators during an event.AFC Club Licensing Regulations 53

d) All exit doors and gates in the stadium, and all gates leading fromthe spectator areas into the playing area, must open outwardsaway from the spectators, and must remain unlocked whilespectators are in the stadium. Each and every such door and gatemust be attended at all times by a specially appointed steward,to guard against abuse and ensure immediate escape routesin the event of any emergency evacuation. In order to preventillegal entry or intrusion, these doors and gates may be fitted witha locking device, which may be operated simply and quickly byanyone from within. Under no circumstances must they be lockedwith a key during the time that spectators are in the stadium.e) In order to protect those on the field or in other parts of thestadium from lightning strikes, the stadium should be equippedwith the appropriate safety devices.f) It is essential that event holders and stadium safety/securityauthorities are capable of communicating with spectators insideand outside the stadium by means of a sufficiently powerfuland reliable public address system (loudspeakers) and/or by ascoreboard and/or a video screen.No. Grade DescriptionI.07 A STADIUM – APPROVED EVACUATION PLANThe appropriate body (e.g. safety and security authority, competentcivil authority or other qualified and approved firms, etc.) approvesthe evacuation plan which ensures that the whole stadium canbe emptied in a case of emergency according to the applicablenational law.If such law does not exist, the licensor establishes the content ofthe evacuation plan, including an evacuation time and the approvalbody, in close co-operation with the appropriate civil body (e.g.local security authorities, the local hospital, fire brigade, police,etc.).54AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionI.08 A TRAINING FACILITIES – AVAILABILITY7.4.2 “B” CRITERIANo. Grade DescriptionThe licence applicant must have training facilities availablethroughout the year. The licence applicant either:-a) owns the training facilities; orb) can provide a written contract with the owner(s) of the trainingfacilities This contract must guarantee the use of the trainingfacilities for the coming season, for which the licence applicantqualifies in sporting terms, for all teams which participate ina championship approved by the national/regional association(cf. I.03).I.09 B TRAINING FACILITIES FOR YOUTH PROGRAMME –APPROVED INFRASTRUCTUREThe licence applicant must have available training facilities whichcomply with the requirements set by the licensor taking intoaccount the approved youth development programme (cf. 6).As a minimum, the licensor must define the minimum number andsize of:-a) outdoor training facilities;b) indoor training facilities;c) the dressing rooms;d) the medical room(s).AFC Club Licensing Regulations 55

No. Grade DescriptionI.10 B STADIUM – GROUND RULESEach stadium must issue stadium ground rules and affix themto the stadium in such a way that the spectators can read them.These rules must provide information on at least the following:-• admission rights;• abandonment or postponement of events;• description of prohibitions and penalties, such as entering• the field of play, throwing objects, use of foul or abusivelanguage, racist behaviour, etc.;• restrictions with regard to alcohol, fireworks, banners, etc.;• seating rules;• causes for ejection from the ground;• risk analysis specific to the stadium.No. Grade DescriptionI.11 B STADIUM – SANITARY FACILITIESEach stand must provide sufficient toilet facilities for both sexesin accordance with the local authority regulations or the licensor’sRequirements. These amenities must include washing facilitieswith at least cold water and a plentiful supply of towels and/or handdryers.They must be bright, clean and hygienic and a procedure shouldbe established to maintain that condition throughout each event.AFC recommends for every 1,000 spectators, a minimum of:-• Five toilets with seats for men;• Eight urinals; and• Five toilets with seats for women.56AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionI.12 B STADIUM – COVERED SEATSThe licensor shall determine the minimum number of individualseats which must be covered.AFC recommends that one third of the individual seat capacity becovered especially the grandstand and the press box.7.4.3 “C” CRITERIANo. Grade DescriptionI.13 C STADIUM – SIGNPOSTING AND DIRECTIONSAll public direction signs inside and outside the stadium must bepresented in internationally understandable pictographic language.Clear, comprehensive signposting must be provided at the stadiumapproaches and around, and throughout the stadium to point theway to the different sectors.Tickets must clearly identify the location of the seats for whichthey have been issued. Information on the tickets must correlatewith the signpost information provided, both inside and outside thestadium.Colour coding of tickets will assist the entry process, and retainedticket stubs must contain information which will guide spectatorsonce they are inside. Large-scale wall maps must be provided forthe guidance of spectators.No. Grade DescriptionI.14 C STADIUM – SPECTATOR WITH DISABILITIESThe licensor shall set up requirements to accommodate disabledspectators and accompanying persons safely and comfortably.AFC Club Licensing Regulations 57

8. PERSONNEL AND ADMINISTRATIVECRITERIA8.1 INTRODUCTIONNowadays a football club is not only a sports club but is also in contact with otherparties. The members, the supporters, the media, the sponsors, the suppliers,the commercial partners, the local community and, in some cases already, theshareholders of the football club are more and more involved and interested in thedevelopment and results of a football club.Therefore, professional support should be sought from specialists from variouseconomic fields and industries (e.g. marketing, finance, entertainment, media, etc.).They can share their knowledge and experience with today’s football clubs, to bettersatisfy the needs and demands of those participants and stakeholders of footballwho must be treated as clients.Football clubs already operate in a competitive environment on the sporting side butthey are increasingly becoming involved in an economic competition. Clubs have tostrengthen the profitability in the long term.Football clubs should look for new and different sources of revenue in addition tothe existing ones (TV, gate receipts, sponsors) in order to be more independent ofthe income from the sporting success of the club and to have greater possibilities offunctioning as a financially successful entity.In this respect, football clubs need advice from other professionals, experienced, welleducated and innovative people who can bring different skills and know-how into theclub and help to satisfy the additional needs and demands of today’s football.8.2 OBJECTIVESThe objectives of the personnel and administrative criteria are that:-• licence applicants are managed in a professional way;• licence applicants have available well-educated, qualified and skilled specialistswith a certain know-how and experience;• the players of the first and other teams are trained by qualified coaches andsupported by the necessary medical staff.58AFC Club Licensing Regulations

AFC Club Licensing Regulations8.3 BENEFITS FOR CLUBSProfessional, well-educated and experienced staff is of key importance to run afootball club in an efficient and effective manner. Being professional at all levels andin all functions does not mean that licence applicants have to recruit only full-timestaff.The focus is on the professional manner in which the persons appointed perform theirduties. Each criterion in this chapter is really important for the smooth and successfulrunning of the club, and every club could or should be able to afford these functionsin financial terms.The professionalism will also be improved if clubs are defining clear profiles for thesefunctions, which include the main activities, the main responsibilities (technical,financial and decision power, if applicable) and the requirements for the job(education, working experience, technical know-how, IT-skills, human competences,language skills and others incl. football know-how).It is up to the decision-making body of the licence applicant to look for people, whomeet the set requirements and to engage those candidates that comply with thedefined profile (e.g. full-time, part-time, volunteer).Qualified coaches are the basis for high quality of education within the footballteams. In order to achieve this objective, licence applicants need the support ofthe national association to establish a coach education programme. To improve thefootball skills of your youth teams as well as your first team squad in all aspects(technically, tactically and physically), trained and qualified coaches are needed.Each youth player who dreams of becoming a professional footballer is entitled tothe best qualified coaches from the youngest age. Other skills (e.g. psychologicaltraining, media training, social skills, language skills, etc.) are necessary and must beachieved through specific training organised by the national association with a viewto issuing a licence for coaches. This is not only desirable but is a must.In collaboration with the national associations, AFC has implemented the AFC CoachEducation system throughout Asia which standardizes the delivery and quality ofcoach education. The AFC Pro-, AFC A- and AFC B- and AFC C- certificates /licenses offer “free movement of coaches” within AFC member associations.AFC Club Licensing Regulations 59

Additional administrative support from specialists in safety and security matters willthen ensure that matches are organised as safe events.8.4 CRITERIA8.4.1 “A” CRITERIANo. Grade DescriptionP.01 A CLUB SECRETARIATThe licence applicant must have available office space to run itsadministration.The required surface of the office(s) and the required technicalminimum infrastructure including phone, fax and email must beavailable.The licence applicant must have appointed the appropriatenumber of skilled secretarial staff according to its needs to runits daily business. It must also ensure that its office is open tocommunicate with the licensor and the public.No. Grade DescriptionP.02 A GENERAL MANAGERThe licence applicant must have appointed a General Managerbeing responsible for running its daily business (operative matters).The appointment must have been done by the appropriate body(e.g. Executive Board) of the licence applicant.No. Grade DescriptionP.03 A FINANCE OFFICERThe licence applicant must have appointed a Finance Officerbeing responsible for its financial matters who can be either aperson working in the club’s administration or an external partnermandated by the club through a written contract.60AFC Club Licensing Regulations

AFC Club Licensing RegulationsThe Finance Officer must hold as a minimum one of the followingqualifications:-a) a diploma of certified public accountant; orb) a diploma of qualified auditor; orc) a “recognition of competence” issued by the licensor based onits financial background and a practical experience in financialmatters of at least 3 years’.The appointment must have been done by the appropriate body ofthe licence applicant.No. Grade DescriptionP.04 A SECURITY OFFICERThe licence applicant must have appointed a Security Officerbeing responsible for safety and security matters.The Security Officer must hold as a minimum one of the followingqualifications:-a) a certificate as policeman or security person according tonational law, or;b) a safety and security diploma based on a specific courseissued by the national association or by a state recognisedorganisation, or;c) a “recognition of competence” approved by the nationalassociation, which is based on the participation in specificsafety and security course of the national association and atleast one year experience in such matters.The appointment must have been done by the appropriate body ofthe licence applicant.AFC Club Licensing Regulations 61

No. Grade DescriptionP.05 A MEDIA OFFICERThe licence applicant must have appointed a Media Officer beingresponsible for media matters.The Media Officer must hold as a minimum one of the followingqualifications:-a) diploma in journalism education;b) concluded a media officer education course provided by thenational association or an organisation recognised by thenational association;c) a “recognition of competence” approved by the nationalassociation, which requires at least one year experience insuch matters.The appointment must have been done by the appropriate body ofthe licence applicant.No. Grade DescriptionP.06 A MEDICAL DOCTORThe licence applicant must have appointed at least one doctorbeing responsible for the medical support and advice for the firstsquad as well as for doping prevention policy. He must ensuremedical support during matches and training.The Medical Doctor must possess medical qualifications [MD/MBBS degree from Medical University/ Medical College (minimum5 year program)] and must be duly registered with the MdicalBoard / Medical Council in the Member Country as well as with thenational association or league.The appointment must have been done by the appropriate body ofthe licence applicant.62AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionP.07 A PHYSIOTHERAPISTThe licence applicant must have appointed at least onephysiotherapist being responsible for medical treatment andmassages for the first squad during the trainings and matches.The physiotherapist must possess a Degree in Physiotherapy fromUniversity / College (3 year degree program).The physiotherapist must be recognised and certified by theappropriate national health authorities and/or registered withphysiotherapy board/ council in member country.The physiotherapist must be duly registered with nationalassociation or league.The appointment is done by the appropriate body of the licenceapplicant.No. Grade DescriptionP.08 A HEAD COACH OF FIRST SQUADThe licence applicant must have appointed a Head Coach beingresponsible for football matters of the first squad.The Head Coach must:-a) hold at least a valid AFC ‘A’ Certificate or any valid foreigncoaching diploma which is equivalent to this one andrecognized by AFC as such (Alternative 1 according to table inthe Manual; the licensor must define which alternative appliesby taking into account the status of implementation of the AFCCoach Education programme); orb) already have started the required education course, recognizedby the national association, allowing him to achieve the requireddiploma as defined under a) above. The simple inscription tosuch an education course is not deemed to be in compliancewith the criterion (Alternative 2 according to the table in theManual); orAFC Club Licensing Regulations 63

c) hold a “recognition of competence” issued by AFC. A“recognition of competence” is provided by AFC in cases wherethe Head Coach of the first squad does not meet the requiredcertificate as defined under a) and b) above but has been ahead coach at professional level or national team in the last fiveyears preceding his application/appointment as head coach.The Head coach must be duly registered with the nationalassociation or league. The appointment of the head coach musthave been done by the appropriate body of the licence applicant.No. Grade DescriptionP.09 A ASSISTANT COACH OF FIRST SQUADThe licence applicant must have appointed an assistant coachassisting the head coach in all football matters of the first squad.The assistant coach must:-a) hold at least a valid AFC ‘B’ Certificate or any valid foreigncoaching diploma which is equivalent to this one and recognizedby AFC as such (Alternative 1, or 2 according to table in theManual; the licensor must define which alternative applies bytaking into account the status of implementation of the AFCCoach Education programmeb) already have started the required education course, recognizedby the national association, allowing him to achieve the requireddiploma as defined under a) above. The simple inscription tosuch an education course is not deemed to be in compliancewith the criterion (Alternative 3 according to the table in theManual);The assistant coach must be duly registered with nationalassociation or league. The appointment must have been done bythe appropriate body of the licence applicant.64AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionP.10 A HEAD OF YOUTH DEVELOPMENT PROGRAMMEThe licence applicant must have appointed a head of the youthdevelopment programme being responsible for running the dailybusiness and the technical aspects of the youth sector.The Head of the youth development programme must:-a) hold at least a valid AFC ‘A’ Certificate or any valid foreigncoaching diploma which is equivalent to this one and recognizedby AFC as such (Alternative 1 or 2 according to table in theManual; the licensor must define which alternative applies bytaking into account the status of implementation of the AFCCoach Education programme);b) already have started the required education course, recognizedby the national association, allowing him to achieve the requireddiploma as defined under a) above. The simple inscription tosuch an education course is not deemed to be in compliancewith the criterion (Alternative 3 according to the table in theManual);The Head of the youth development must be duly registered withthe national association or league. The appointment of the Headof the youth development must have been done by the appropriatebody of the licence applicant.No. Grade DescriptionP.11 A YOUTH COACHESThe licence applicant must have appointed at least one coachresponsible for all football matters for each mandatory youth team(cf. S.02).The youth coach must hold the minimum qualification as definedby the licensor.He must be duly registered with national association or league.The appointment must have been done by the appropriate body ofthe licence applicant.AFC Club Licensing Regulations 65

No. Grade DescriptionP.12 A SAFETY AND SECURITY ORGANISATION - STEWARDING8.4.2 “B” CRITERIANo. Grade DescriptionThe licence applicant must have established a safety and securityorganisation for home matches through the engagement ofstewards. For this purpose, it must:-a) employ the stewards; orb) conclude a written contract with the stadium owner providingthe stewards; orc) conclude a written contract with an external security companyproviding stewards.The licence applicant must provide appropriately qualified stewards(internal or external).P.13 B RIGHTS AND DUTIESThe rights and duties of the licence applicant’s staff membersdefined in P.01 to P.12 must be defined in writing.No. Grade DescriptionP.14 B DUTY TO NOTIFY SIGNIFICANT CHANGESAny event occurring after the submission of the licensingdocumentation to the licensor representing a significant changecompared to the information previously submitted and related tocriteria P.01 to P.12, must be notified to the licensor within the fixeddeadline (see AFC comment in the Manual).The compliance with this criterion shall be assessed by the licensorin respect of the next licensing cycle.66AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionP.15 B DUTY OF REPLACEMENT DURING THE LICENSING SEASONIf a function defined in criteria P.01 to P.11 becomes vacant duringthe licensing season due to a reason beyond the control of thelicence applicant (illness, accident, etc.) then the licence applicantmust ensure that such function is taken over by:-a) a person who holds the necessary qualification and fulfillingthe criterion (in which case the replacement may be for anindefinite period of time);b) a person who does not hold the necessary qualification anddoes not fulfill the criterion (in which case the replacement isonly temporarily and cannot last longer than until the end of thelicensing season).If a function in criteria P.01 to P.12 becomes vacant due to adecision of the licence applicant (e.g. release of head coach) thenthe licence applicant must ensure that such function is taken overby:-a) a person who holds the necessary qualification and fulfillingthe criterion (in which case the replacement may be for anindefinite period of time);The replacement must be notified to the national association within7 working days.The compliance with this criterion shall be assessed by the licensorin respect of the next licensing cycle.AFC Club Licensing Regulations 67

9. LEGAL CRITERIA9.1 INTRODUCTIONThis chapter defines the minimum legal criteria for licence applicants.9.2 CRITERIA9.2.1 “A” CRITERIANo. Grade DescriptionL.01 A DECLARATION IN RESPECT OF THE PARTICIPATION IN AFCCLUB COMPETITIONSThe licence applicant must submit a legally valid declarationconfirming the following:-a) it recognises as legally binding the statutes, rules and regulationsand decisions of FIFA, AFC, the national association and, ifthey exist, of the national league;b) it recognizes the exclusive jurisdiction of CAS (the Court ofArbitration for Sport in Lausanne) for any dispute of internationaldimension and in particular involving FIFA and/or AFC;c) it recognizes the prohibition on recourse to ordinary courtsunder the FIFA and AFC Statutes;d) at national level, it will play in competitions that are recognisedand endorsed by the national association (e.g. nationalchampionship, national cup);e) at continental level, it will participate in competitions recognisedand endorsed by AFC. To avoid any doubt, this provision doesnot relate to friendly matches;f) it undertakes to abide by and observe the provisions andconditions of the National Club Licensing Regulations;g) all submitted documents are complete and correct;h) it authorises the competent club licensing authority to examinedocuments and seek information and, in the event of anyappeal procedure, to seek information from any relevant publicauthority or private body according to national law;68AFC Club Licensing Regulations

AFC Club Licensing Regulationsi) it acknowledges that AFC reserves the right to execute spotchecksat national level reviewing the assessment process andthe decision making;j) it acknowledges that FIFA reserves the right to execute spotchecksat national level to review the assessment processand the decision making in case AFC fails to implement andexecute a sport check procedure at national level.k) it will inform the licensor about any significant change, event orcondition of major economic importance and subsequent eventoccurred after the submission of the licensing documentation(cf. P.14, F.05 and F.07) within the fixed deadlines (cf. P.14 seeAFC comments);This declaration must be executed by an authorised signatory nomore than three months prior to the corresponding deadline for itssubmission to the licensor.No. Grade DescriptionL.02 A OTHER DOCUMENTS AND CONFIRMATIONS FROM THELICENCE APPLICANTThe licence applicant must submit the following documents:-a) Copy of the licence applicant’s current company articles (e.g.company act);b) An extract from a public register (e.g. trade register) containinginformation on the license applicant (such as name, address,legal form, list of authorized signatories and type of requiredsignature)These documents must be executed by an authorised signatoryno more than three months prior to the corresponding deadline fortheir submission to the licensor.AFC Club Licensing Regulations 69

No. Grade DescriptionL.03 A OWNERSHIP AND CONTROL OF CLUBSThe licence applicant must submit a legally valid declarationoutlining the ownership structure and control mechanism of theclub.No natural or legal person involved in the management,administration and/or sporting performance of the club, eitherdirectly or indirectly:-a) holds or deals in the securities or shares of any other clubparticipating in the same competition;b) holds a majority of the shareholders’ voting rights of any otherclub participating in the same competition;c) has the right to appoint or remove a majority of the membersof the administrative, management or supervisory body of anyother club participating in the same competition;d) is a shareholder and alone controls a majority of theshareholders’ voting rights of any other club participating in thesame competition pursuant to an agreement entered into withother shareholders of the club in question;e) is a member of any other club participating in the samecompetition;f) is involved in any capacity whatsoever in the management,administration and/or sporting performance of any other clubparticipating in the same competition;g) has any power whatsoever over the management;h) administration and/or sporting performance of any other clubparticipating in the same club competition.This declaration must be executed by an authorized signatory nomore than three months prior to the corresponding deadline for itssubmission to the licensor.70AFC Club Licensing Regulations

AFC Club Licensing Regulations9.2.2 “B” CRITERIANo. Grade DescriptionL.04 B DISCIPLINARY PROCEDURE WITHIN THE CLUBThe licence applicant must submit a legally valid Disciplinaryregulation of the club which shall comply with the national lawand FIFA, AFC and National Association statutes, rules andregulations under which the infringement of club rules, regulationsand decisions shall be prosecuted and sanctions shall be appliedin accordance with a legally established proceeding and bycompetent body of the club.9.2.3 “C” CRITERIANo. Grade DescriptionL.05 C CODE OF CONDUCT FOR PLAYERS AND OFFICIALSIt is recommended that the licence applicant establishes alegally valid code of conduct for players and officials which is incompliance with the national law and FIFA, AFC and NationalAssociation Statutes, Rules and Regulations.No. Grade DescriptionL.06 C LEGAL OFFICERIt is recommended that the licence applicant appoint a legal person(full time or part time) who is responsible to handle all legal mattersin the licence applicant’s activities.The legal advisor shall have the necessary legal qualifications.AFC Club Licensing Regulations 71

10. FINANCIAL CRITERIA10.1 INTRODUCTIONThe financial criteria relate to:• Historic financial information about a club’s financial performance and position;• Future financial information about a club’s future prospects; and• Subsequent information after the licensing decision has been made.To facilitate the implementation of the financial criteria, historic financial informationmay continue to be prepared on the basis of national accounting practice requirements.The preparation and presentation of financial statements by entities differs fromcountry to country due to a variety of social, economic and legal circumstances anddue to different countries having in mind different users of financial statements whensetting national requirements.AFC recognises that the implementation of the financial criteria in the nationalregulations presents a challenging task for many member associations and clubs.The financial criteria - to be met for participation in the 2013 AFC season - are set outin this chapter. This means that financial information in respect of the financial yearending in 2011 will form part of the information to be assessed by licensors for clubsto obtain a licence for the 2013 season.Member associations or their affiliated leagues (i.e. licensors) are encouraged to tryto implement the requirements of this revised version of chapter 10 at an earlier dateso as to be in effect before the 2013 season.10.2 OBJECTIVESThe financial criteria aim principally to:-• Improve the economic and financial capability of the clubs;• Increase clubs’ transparency and credibility;• Place the necessary importance on the protection of creditors;• Safeguard the continuity of international competitions for one season; and• Monitor financial fair play in AFC club competitions.72AFC Club Licensing Regulations

AFC Club Licensing Regulations10.3 BENEFITSImplementation of the financial criteria will help deliver both short and long termimprovements for clubs, the licensors and for the football family in general. For thefootball family in general, the financial criteria should help to:-• Safeguard the continuity and integrity of competitions;• Increase the transparency and credibility of clubs’ financial operations and,thereby, of Asian football generally;• Improve confidence in the probity of the football industry;• Create a more attractive market for the game’s commercial partners andinvestors; and• Provide the basis for fair competition, because competition is not just about theteams on-the-pitch.For the licensors, the financial criteria should help to:-• Improve their understanding of the financial position and prospects of theirmember clubs;• Encourage clubs to settle liabilities to creditors on a timely basis;• Enhance their ability to be proactive in assisting clubs with financial issues; and• Provide a starting point for club benchmarking, at a national level, for thoselicensors and clubs who want to develop this aspect.For the clubs, the financial criteria should help to:-• Improve standards and quality of financial management and planning activities;• Enable better management decision-making;• Enhance clubs’ financial and business credibility with stakeholders;• Improve financial stability; and• Enhance revenue generating ability and cost management.10.4 REPORTING PERIOD AND FORMATFor further information on mandatory reporting period and minimum requirementon the format of reporting and accounting as well as detailed explanation of each ofthe criteria below, please refer to Chapter 6 of the AFC Club Licensing Manual.AFC Club Licensing Regulations 73

10.5 CRITERIA10.5.1 HISTORIC FINANCIAL INFORMATIONEvery licensor has to ensure that, in respect of the clubs which qualify for AFCclub competitions, the following minimum criteria are met. For implementationwithin the national club licensing regulations, the licensor may developadditional criteria, information requirements and assessment procedures.No. Grade DescriptionF.01 A ANNUAL FINANCIAL STATEMENTS - AUDITEDRegardless of the legal structure of the licence applicant, annualfinancial statements based on the local legislation for incorporatedcompanies shall be prepared and audited by independent auditors.The annual financial statements shall meet the minimum disclosurerequirements and accounting principles defined by this manual.Alternative 1:If the audited annual financial statements meet the minimumdisclosure requirements and accounting principles defined bythis manual, then no further supplementary information has to beprovided.Alternative 2:If the audited annual financial statements do not meet the minimumdisclosure requirements and accounting principles defined by thismanual, then supplementary information must be prepared by thelicence applicant and assessed by the auditor.74AFC Club Licensing Regulations

AFC Club Licensing RegulationsNo. Grade DescriptionF.02 C FINANCIAL STATEMENTS FOR THE INTERIM PERIOD –REVIEWEDIf the statutory closing date of the licence applicant is more than sixmonths before the deadline for submission of the list of licensedclubs to AFC, then the licence applicant is encouraged to submitand prepare additional financial statements covering the interimperiod. If the financial statements for the interim period are preparedand submitted, they should cover the interim period up to a datewithin six months preceding the deadline for submission of the listof licensed clubs to AFC and must be reviewed by independentauditors. It is advised that the interim financial statements meetthe minimum disclosure requirements and accounting principlesdefined by the Manual.No. Grade DescriptionF.03 A NO PAYABLES OVERDUE TOWARDS FOOTBALL CLUBSARISING FROM TRANSFER ACTIVITIESThe licence applicant must prove that it has no payables overdue(e.g. final and binding decisions of the FIFA Players’ StatusCommittee, the FIFA Dispute Resolution Chamber and the Courtof Arbitration for Sport) towards football clubs arising from transferactivities as at 31 December of the year preceding the seasonto be licensed, unless by the following 31 March they have beenfully settled, deferred by mutual agreement with the creditor orare subject to a not obviously unfounded dispute submitted to acompetent authority.AFC Club Licensing Regulations 75

No. Grade DescriptionF.04 A NO PAYABLES OVERDUE TOWARDS EMPLOYEES ANDSOCIAL / TAX AUTHORITIESThe licence applicant must prove that, in respect of contractual andlegal obligations with its current and former employees (including allprofessional players according to the applicable FIFA Regulationson Status and Transfer of Players, the general manager (P.02), thefinance officer (P.03), the security officer (P.04), the doctor (P.05),the physiotherapist (P.06), the head coach of first-team squad(P.08), the assistant coach of first-team squad (P.09), the headof youth development (P.10) and the youth coaches (P.11); listexhaustive), it has no payables overdue towards employees andsocial/tax authorities as at 31 December of the year preceding theseason to be licensed, unless by the following 31 March they havebeen fully settled, deferred by mutual agreement with the creditoror are subject to a not obviously unfounded dispute submitted to acompetent authority.No. Grade DescriptionF.05 A WRITTEN REPRESENTATIONS PRIOR TO THE LICENSINGDECISIONWithin seven days prior to the start of the period in which thelicensing decision is to be made by the First Instance Body, thelicence applicant must make written representations to the licensor.The written representations shall state whether or not any eventsor conditions of major economic importance have occurred,that may have an adverse impact on the licence applicant’sfinancial position since the balance sheet date of the precedingaudited annual financial statements or reviewed interim financialstatements (if applicable).76AFC Club Licensing Regulations

AFC Club Licensing Regulations10.5.2 FUTURE FINANCIAL INFORMATIONNo. Grade DescriptionF.06 A/Bcf. NoteFUTURE FINANCIAL INFORMATIONFuture financial information shall be prepared and submitted bythe licence applicant, consisting of:a) A budgeted profit and loss account;b) A budgeted cash flow; andc) Explanatory notes including assumptions and risks andcomparison of budget to actual figures.The future financial information shall be based on assumptionsthat are not unreasonable and meet the minimum disclosurerequirements defined by this manual.Note: If the licence applicant exhibits a breach of any of the indicators, then thelicensor must undertake more detailed assessment procedures upon the submittedfuture financial information and, in certain circumstances, this may provide thebasis for a licence refusal. If the licence applicant does not exhibit a breach of anyindicators, then the licensor does not have to undertake more detailed assessmentprocedures and, in certain circumstances, the licence applicant may be subject to asanction, but not a licence refusal.10.5.3 SUBSEQUENT INFORMATIONCriteria F.07 and F.08 apply to licensees in the time after the licensing decision.Criterion F.07 (Duty to notify subsequent events) applies to all licensees.Criterion F.08 (Duty to update future financial information) only applies tothose licensees who exhibited a breach of one or more of the indicators.Both criteria will help to safeguard the continuity of the competitions and willprovide the licensor with more transparency and possibility to better assist theclubs during the whole season.AFC Club Licensing Regulations 77

No. Grade DescriptionF.07 B DUTY TO NOTIFY SUBSEQUENT EVENTSFollowing the licensing decision by the decision-making body,the licensee must promptly notify the licensor in writing aboutany subsequent events that may cast significant doubt upon thelicensee’s ability to continue as a going concern until at least theend of the season for which the licence has been granted.Compliance with this criterion shall be assessed by the licensor inrespect of the following licensing cycle.No. Grade DescriptionF.08 B DUTY TO UPDATE FUTURE FINANCIAL INFORMATIONIf the licensee is in breach of one or more of the indicators (cf.6.7.5 of the AFC Club Licensing Manual), then the licensee mustprepare and submit an updated version of the future financialinformation (prepared according to F.06). In addition, the preparedinformation shall include a comparison of budget to actual figuresincluding explanations of variances. The updated version of thefuture financial information must be prepared, as a minimum, on asix-month basis.The updated future financial information shall meet the minimumdisclosure requirements defined by this manual. Compliance withthis criterion shall be assessed by the licensor in respect of thefollowing licensing cycle.78AFC Club Licensing Regulations

AFC Club Licensing Regulations11. FINAL PROVISIONS11.1 APPENDICES11.1.1 All appendices to the present regulations form an integral partthereof.11.2 DISCIPLINARY PROCEDURES11.2.1 Any breach of these regulations may be penalized by AFC inaccordance with the AFC Disciplinary Code.11.3 IMPLEMENTING PROVISIONS11.3.1 The AFC Administration shall take the decisions and adopt, in theform of directives, the detailed provisions necessary for implementingthese regulations.11.4 MATTERS NOT PROVIDED FOR11.4.1 Matters not provided for in these regulations shall be decided by theAFC Executive Committee, whose decisions are final.11.5 RATIFICATION11.5.1 These regulations were ratified by the AFC Executive Committee atits meeting on 26 March 2010 and came into force immediately.For the AFC Executive CommitteeMOHAMED BIN HAMMAMPresidentALEX SOOSAYGeneral SecretaryKuala Lumpur, March 2010AFC Club Licensing Regulations 79

APPENDIX I: CORE PROCESSThe following chart provides an example of a core process:-The numbers in the chart detail in logical order refer to the steps to be taken in termsof processing a club licence on behalf of the licence applicants. The chart followsthe sequence of numbers from 1 to 19 (left column). These steps will be the onesto follow where no issues arise in the process, ie. a licence applicant meets all therequirements and the licensor’s management proceeds according to the ideal plan.The letters in the chart refer to the issues that may or are likely to arise in the processand which need to be dealt with appropriately. The chart follows the sequence ofletters from (A) to (I) (central column). The right column provides the reader with ashort description of each single step.80AFC Club Licensing Regulations

AFC Club Licensing RegulationsCore Process3 21. LM produces pack on club licensing which will includethe criteria and a questionnaire and forms for return.1. LM preparesdocuments fordistribution2. LM distributes documents to applicants – these couldbe posted, placed on extranet etc.2. Documents sent toapplicants to complete3. Applicant completes and returns information within theagreed deadlines.3. LM receives applicantreturn with supportingdocuments4. LM checks that documents are complete.4. LM checks thatdocuments arecomplete5. okYES6. Documents sorted,logged and allocatedto staffNO(A).Contactapplicantand agreeaction(A)• From s tep 5: Applicant does not p rovide a ll necessarydocuments. L M contacts applicant t o request i nformationthat is missing or• From s tep 8: nominated s taff t hat r eview applicantreturns identity areas that require further information andclarification from the applicant.6. The LM sorts the information received, records it andforwards to each staff member with responsibilities for thatparticular areas.7. Nominated staffreview and reportback to LM8. okYES9. LM reviewsreport of expertsNO7. Nominated staff reviews applicant submissions ie. thelegal expert checks the legal criteria, the financial expertchecks t he financial c riteria e tc. The checks have t o bejustified by supporting documents (evidence t hat t hecriteria have been fulfilled). Decision by LM based uponthe opinion of the relevant experts on whether to proceedto next stage with applicants’ documents as they stand orrefer documents back to the applicant for improvement.19. T he licensing m anager r eviews the reports and t heopinion of the experts.Licensor’s administration Decision making bodies License applicant/licenseeAFC Club Licensing Regulations 81

Core Process110. The licensing manager assesses the applicant. On the basis of the reports of theexperts and/or the site visits (if necessary) he may identify areas of concerns that mayrequire further investigation.10. LM assessesapplicant11. ok12. Prepare report toFirst Instance bodyNONO(B). Discuss anyconcerns with theapplicant(C). ok(B). LM discusses those areas of concern or non-compliance with the applicant that havebeen identified. The licensing manager may require further explanations or supportingdocuments or may decide to perform a site visit to perform further investigation. If a site visitis planned, the LM and applicant meet and address the problem areas and potentialactivities by the applicant to rectify these areas together with a timescale.12. LM completes FIB report forconsideration of First Instance Body. Thisreport will contain aspects of the visitreport and other areas including arecommendation that a licence is granted.(C). The applicant agrees with the actionplan and take the necessary actions toaddress problem areas. The applicantdoes not agree with action plan and doesnot take the recommended actions.13. LM obtainsmanagementrepresentation letter(D). Licenserefused13. LM obtains management representation letter from licence applicant stating whether ornot any events or conditions of major economic importance have occurred.14. FIB review14. Review by First Instance. This can either be a committee of external experts or aninternal group of competent staff. The FIB may request a hearing with the licence applicant,this in particular in case of existence of major economic event.15. DecisionNO(E). Applicantappeals15. FIB takes a decision whether to issuethe club with a licence or not.(D). The licence is refused, applicant isadvised with reasons outlined and giventhe option of instigating the appeals toprocess.AppealsbodyYES(F). LM preparesreport(E). Applicant lodges an appeal. Appeals Body notified and meeting date agreed.(G). Appeals bodyreview(F). LM produces a report and dispatches this to the Appeals Body.16. License issuedIndicatorsbreachedIndicatorsfulfilledYES17. LM submitslist of licensedapplicants to AFC(H). DecisionNO(l). Licenserefused(G). Appeals Body meet and consider club appeal.(H). Appeal Body takes a decision whether to issue the applicant with a licence or not.16. Licence granted which may or maynot detail areas for future attention of theapplicant and stating whether or notfinancial indicators have been breached.(I). Licence refusal that details areas to beaddressed.17. LM communicates AFC the list of the licensed applicants entering an AFC clubcompetition within the AFC deadline.19. Dutyto update18. Duty to notifysubsequent events18. The licensee promptly notifies the licensor in writing about any subsequent event thatmay have an adverse impact upon the licensee’s ability to continue as a going-concern untilthe end of the licensing season.19. If the licensee is in breach of one or more of the indicators, then the licensee mustprepare and submit an updated version of the future financial information.3 2Licensor’s administration Decision making bodies License applicant/licensee82AFC Club Licensing Regulations

AFC Club Licensing Regulations1. Prior to the deadline for the submission to AFC of the list of clubs entering aAFC club competition and at a date to be defined by the licensor, the licensingmanager produces the documents on club licensing which will include the criteria,the questionnaires and forms for return.2. The licensing manager distributes the prepared pack of documents to the licenceapplicant. These can be posted, faxed, posted on the extranet, etc. The licensingmanager may request an acknowledgement of receipt.3. The licence applicant completes the documents (questionnaires, templates,etc) and returns them to the licensing manager within the agreed deadline.These documents can be returned by mail, faxed, posted on the extranet, etc.Supporting documents can be enclosed if required.4. The licensing manager checks at the reception that the documents returned bythe licence applicant are complete and that they are returned within the agreeddeadline.5. Decision.Two alternatives: step 6 or step (A)6. If the documents are complete and sent within the agreed deadline, the licensingmanager sorts the information received, records it and forwards it to theappointed experts with responsibilities for that particular areas for review (eg.Legal documents will be forwarded to the legal expert, financial information to thefinancial expert, etc).7. The nominated experts received the licence applicants’ documents from thelicensing manager, review the documents, check the fulfillment of the criteriaand then report back to the licensing manager within the agreed deadline andaccording to prepared forms (checklists, reports etc). The checks have to bejustified by supporting documents (evidence that the criteria have been fulfilled),eg. Criteria I.01 Stadium-certification has to be supported by a copy of the validstadium certificate.8. Decision.Two alternatives: step 9 or step (A)AFC Club Licensing Regulations 83

9. The licensing manager verifies that the reports of the experts are complete andreturned within the agreed deadline. The licensing manager reviews the reportsand the opinion of the experts.10. The licensing manager assesses the licence applicant. On the basis of thereports of the experts he may identify areas of concern that may require furtherinvestigation.11. Decision.Two alternatives: step 12 or step (B)12. If the licensing manager does not identify any area that requires further review,he prepares the report for consideration of the FIB within the agreed deadline.This report will contain aspects of the review (analysis of the documents receivedand, if performed, information on site visits).13. LM obtains management representation letter from licence applicant statingwhether or not any events or conditions of major economic importance haveoccurred. This is included to his report. According to the results of the review, thereport will include the recommendation to grant or to refuse the licence.14. The FIT receives the report of the licensing manager within the agreed deadline,reviews it, asks the licensing manager for further explanations and documents ifnecessary and makes the decision whether to grant the licence or not. The FIBhas to fulfil the requirements of qualification, independence and confidentiality asdescribed in Section 3.2 of AFC Club Licensing Regulations.15. Decision.Two alternatives: step 16 or step (D).16. After careful review of the licence applicant’s documents and of the report of thelicensing manager, the decision-making body issues the licence. The issuanceof the licence is subject to the condition that the licence applicant fulfils all MUSTcriteria definied in the UEFA club licensing manual. The issued licence may ormay not detail areas for future attention of the licence applicant.84AFC Club Licensing Regulations

AFC Club Licensing Regulations17. The licensing manager receives the report of the decision-making body. On thebasis of the decision made by the decision-making body, he prepares the list ofthe licence applicants authorized to enter in an AFC club competition. The listof licensed clubs is sent to AFC within the deadline fixed and communicated byAFC by 30 November of the year preceding the season to be licensed.18. After it has been issued a licence, up until the end of the season to be licensed,the licensee must promptly notify the licensor in writing of any subsequent event,that it is aware of at any time, that may cast significant doubt upon the licensee’sability to continue as a going concern until at least the end of the season frowhich the license has been granted.19. If the licensee is in breach of one or more of the indicators, then the licenseemust prepare and submit an updated version of the future financial information.The future financial information must be prepared, as a minimum, on a six monthbasis.(A) From step 5:If the documents are not compete or if they are not sent within the agreed deadlinethe licensing manager contacts the licence applicant in order to agree on thenext actions to be taken (eg. to request information, supporting documents,questionnaire or form that is missing).(B) From step 8:If the licensing expert identifies areas that require further information, he contactsthe licence applicant to discuss any issue to obtain clarifications, and reaches amutual agreement on the actions to be taken.If the licensing manager identifies areas that require further review (noncompliancewith certain criteria, errors, lack of information, etc) he contacts thelicence applicant to discuss any concerns. The licensing manager may requirefurther explanations or supporting documents or may decide to perform a sitevisit for the purposes of further investigation. If a site visit is planned, the licensingmanager and/or the expert meet with the licence applicant and address theproblem areas.They identify potential actions by the club to rectify these areas together with atimescale.AFC Club Licensing Regulations 85

(C) Decision.Two alternatives:• If the licence applicant agrees with the licensing manager on the actionsto be taken, then go back to step 10.• If the licence applicant does not agree with the licensing manager’s reportand refuses to deliver new information or to take the necessary actions,then go back to step 12.(D) After careful review of the licence applicant’s documents and of the report of thelicensing manager the FIB refuses to grant the licence. The refusal details theareas to be addressed and the licence applicant is given the possibility of lodgingan appeal with the AB.(E) The licence applicant lodges an appeal. The AB is notified and the meeting dateis set by agreement.(F) The licensing manager produces a report and delivers it to the AB. The reportdetails areas of concern and the reasons for the refusal.(G) The AB meets and considers the licence applicant’s appeal. The B may requirefurther information and/or supporting documentation from the licensing managerand/or licence applicant.(H) Decision.Two alternatives: step 15 or step (I).(I) After careful review of the licence applicant’s documents and of the report of thelicensing manager, the AB refuses to grant the licence. The report of the B detailsthe reasons for the refusal and the areas to be addressed.Fulfillment of steps 18 and 19 shall be assessed in respect of the following licensingcycle.86AFC Club Licensing Regulations

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