Expanding Canadian Championships to Division 3 Teams

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ANALYSIS: REGIONAL SEMIPROFESSIONAL LEAGUE

3.

The CSA should consider relaxing the financial requirements for a semi-professional league during the initial three years of the competition (the USSF granted concessions with regards to financial requirements to the new NASL in its first two years of operations). The minimum budget of $250,000 annually could prove onerous for instances of senior amateur clubs, with well-organized and established supporters groups, that are candidates for a semi-professional franchise. These clubs could prove to be valuable members of a league in the long-term, yet the short-term financial hurdles could prevent them from seriously considering membership in the first place. The strategy could take the form of conditional exemptions for a period of time for clubs that fall into this category. For investor groups with sufficient resources, an exemption is not necessary. This intention should be communicated in the long-term strategy document so that investors are not caught unawares.

4.

Lastly, the CSA should consider expanding the number of teams eligible to play in the Amway Canadian Championship to include a team or teams from the new semi-professional competition. A review of the academic literature reveals leagues that offer an additional exogenous prize awarded to the winner of the annual championship are likely to invest more on talent and talent development.17 There is currently little incentive for teams or leagues in Canada to seek division III or semi-professional sanctioning, either provincially or nationally. In other countries, lower-level clubs are induced to invest in their playing squads by the knowledge that if they perform well on the field they have an opportunity to advance through a relegation/promotion structure to the next rung of play. As discussed in detail in phase I of this study, a relegation/

17 Helmut Dietl, Egon Franck and Markus Lang, “Overinvestment

promotion arrangement in Canada is not possible owing to the fact there are three independent, U.S. based and controlled closed leagues, each

in Team Sports Leagues — A

with their own set of fixed teams already operating within the country. Since

Contest Theory Model,” Institute

there is no opportunity for teams competing in a new semi-professional

for Strategy and Business Economics Working Paper Series, June 2007. University of Zurich

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competition to earn promotion into these higher division leagues, the CSA must use other means to encourage clubs to professionalize their operations and invest in the development of playing talent.


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