THE SPL and SFA last night admitted they are powerless to prevent Hearts from loaning more players from FBK Kaunas, due to a gaping regulatory loophole which means that even the 13 players the Edinburgh club currently have borrowed from Vladimir Romanov's parent club in Lithuania are not officially classed as "temporary transfers".
Section D of the SPL rules states that member clubs are limited to having four "temporary transfers" registered at any one time, or making five "temporary transfers" in a calendar year, but they also specify that cross-border loan deals - such as those involving Kaunas - which require the creation of a document called an International Transfer Certificate (ITC) - are automatically exempt from the quota. Official documentation requested by the Sunday Herald and provided by the SFA shows that of the 150-plus players of all ages officially registered with the club - more than 60 of which have professional contracts - not a single one is registered as being on loan.
Of all the surprise last-minute transfer deals, there were perhaps surprisingly few eyebrows raised in the direction of Tynecastle, where Hearts' sale of Paul Hartley to Celtic for £1.1m, and loaning of another four players from the Eastern Bloc - only one of whom, Ghanaian Laryea Kingston, was not an FBK Kaunas player - was widely regarded as a continuation of their current transfer policy. This transfer window alone has seen Tomas Kancelskis, Linas Pilibatus, Arnus Lekevicius and Eduardas Kurskis join the club, bringing the club's litany of Lithuanian nationals to 10. When you include Bruno Aguiar, Jose Goncalves and Arkadiusz Klimek - players of other nationalities who are also at Tynecastle by virtue of some kind of loan agreement from Kaunas - to the group, not to mention Kingston (on-loan from Terek Grozny) and Mauricio Pinilla (Sporting Lisbon), that makes 15 players with this disputed loan status altogether and the feeling that such an influx is making a mockery of the spirit, if not the letter, of the SPL rules on the subject.
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SPL secretary Iain Blair admitted last night that concerns had been raised on the topic at boardroom level, only for the outcome to be much shrugging of shoulders and scratching of heads. "Our regulations on loan signings have been in the rules of Scottish football for a long time, in fact we inherited them from the SFL, and the only change came in 2001 when Fifa basically said that an international loan must be regarded as similar to an international transfer," he said. "So therefore we are not able to count international transfers against the quota. The reason our rules were there is to maintain the integrity of the competition, I think it is vital to have them in place and my own view is that it would be preferrable if international transfers were covered by that legislation.
"We constantly keep our rules under review, but this is an area where we are bound by Fifa legislation," he added. "It has been discussed in board meetings and the situation is recognised. We continue to be in direct discussions with Fifa, but we are not aware of anything that is imminent. Fifa reviewed the rules that were established in 2001 and updated them in 2005, but I'm not sure they fully thought through all the consequences." The SPL's sense of impotence is shared by the SFA.
Hearts have just more than three weeks of their allotted nine months to file their latest reports with Companies House - reports which are sure to make interesting reading, if not merely for the budget on flights and expenses incurred by the constant traffic of trialists and loan players to and from their club. They filed their previous set, for the financial year up to July 2005 in December 2005, and although the club has de-listed from the stock exchange to become a private company since then, David Glen, of PriceWaterhouseCoopers still expects a full set of reports to analyse for his annual financial review of Scottish football.
Figures for the financial year to 2005, which saw the club reach both cup semi-finals and sustain a run in the Uefa Cup group stages, saw the club sustain a loss of £2.7m, up from £2.4m the previous year, despite the fact that turnover was up to £8.5m. The last figure for the debt was £21.5m, which has since been transferred to Romanov's Ukio Bankas But it is the wage figure, which at £4.5m represented a respectable 54% of the club's turnover, which promises to be the most instructive.
"It seems to be a fairly vast playing squad and it is unclear exactly how that is being funded," said Glen. "In income terms I would expect it to be another strong year but it is the costs which are difficult to predict." One suspicion amongst fans is that it would be logical to split the club into two separate companies, one a holding company to handle the asset of the Tynecastle ground, and another to carry the debt. "Based on the last reports everything was in the same company," said Glen, "although there may have been a restructuring since then."
Trying to second-guess the mind of Romanov is never the easiest of prospects, but in one sense the logic behind the loan deals is clear. A short-term arrangement allows the Tynecastle club to get a functional player, often a full international, for an annual basic salary in the region of 80,000 litas (or £16,000), roughly what Craig Gordon earns in a week.
That is, of course, if the loan agreement actually requires Hearts, rather than Kaunas, to pay any of their wages at all. Those who do impress on loan deals from Kaunas, such as Roman Bednar, can then sign a permanent deal with the Edinburgh club; those that don't, such as Kestutis Ivaskevicius, return with their tails between their legs. If you are really lucky, like Rudi Skacel, you can sign on loan, agree a permanent deal, and then be sold on to a club like Southampton for a tidy profit.
The only question is whether the reserves of cheap, decent players residing in one Lithuanian football club is big enough or not, a point made even more questionable by the fact that in the likes of Kancelskis, the club are returning to offer contracts to players who were previously rejected. But whether or not the new arrivals are good enough to replace the likes of Hartley or Steven Pressley, that their departure is damaging the prospects of FBK Kaunas itself is undeniable.
"People in Kaunas are feeling that things are not good," said Vidas Rastevis, of the Lithuanian sports weekly. "Kaunas are the best club in Lithuania and people thought that if they could not reach the Champions League group stages then they could definitely reach the Uefa Cup group stages.
People understand why the players themselves might want to go, but we don't understand why the owners of the club would let them go. People at the club don't say things officially - officially they say it is good to have our players playing in Scotland - but unofficially some know that it is not good for Kaunas." Pascal Mendy and Vyacheslav Hleb are also both likely to move on from the club before the summer.
In the absence of Fifa revisiting the subject to alter their statutes to crackdown on one crackpot owner, the final saving grace may be the fact that Uefa legislation on homegrown players is set to come on stream. On three occasions now SPL clubs have indicated their willingness to adopt the European governing body's plans to limit first team squads to 25 of which eventually four must be developed within the club's own youth policy and another four within the national association (ie Scotland), and the SPL are currently working on plans to begin that transitional phase from next season.
"That does present difficulties if you want to bring in a large number of players on loan," said Blair. For all their loan activity, Hearts, however, already have a functioning academy and exciting young players such as David Templeton and Dumitru Copil could be established first-team players by the time such strictures actually come into force.
Until then, it seems, only stronger regulation can bring the Tynecastle squad back down to regulation size.