Manchester City have been charged over FFP breaches, but what do we know about it all and what do we not? Because we may be in uncharted territory here.
When I hear ‘Manchester City’ and ‘FFP’ in the same sentence my eyes tend to start glazing over, so what’s happened now?
The Premier League confirmed on Monday morning with a lengthy statement that Manchester City have been charged with more than 100 breaches of its financial rules following a four-year investigation.
What are the charges relating to?
Formally speaking, the club have been charged with failing to provide ‘accurate financial information that gives a true and fair view of the club’s financial position’. More specifically, this relates to details of club revenue, including sponsorship income and operating costs, with further alleged breaches relating to rules requiring full details of manager remuneration from 2009/10 to 2012/13, when Roberto Mancini was in charge, as well as player remuneration during the period between 2010/11 and 2015/16.
The Premier League has said that City breached rules related to UEFA regulations, including Financial Fair Play (FFP) from 2013/14 to 2017/18, and Premier League profit and sustainability rules from 2015/16 to 2017/18.
We’ve been here before, haven’t we’
Well, yes. In 2020 UEFA ruled that City committed ‘serious breaches’ of FFP regulations between 2012 and 2016. They were handed a two-year ban from European competition, but this was later overturned by the Council of Arbitration for Sport. UEFA’s Club Financial Control Body (CFCB) had found that the Abu Dhabi United Group (ADUG), the company through which Sheikh Mansour owns City, had funded payments in 2012 and 2013, understood to be £15m each year, that were reported to the Football Association and to UEFA as independent sponsorships from the telecoms company Etisalat.
However, the panel of three lawyers found that it could not consider the legitimacy of the Etisalat payments because they were made more than five years before the UEFA’s CFCB charges were brought in May 2019 so were ‘time-barred’, in accordance with UEFA rules for the CFCB.
Weren’t there some issues over the way in which this was dealt with by CAS?
Funny you should mention that, because there were, actually. Some European sports lawyers questioned the independence of the panel member nominated by City, Andrew McDougall QC, a partner in the international law firm White and Case. McDougall was chair of the company’s operations council for Europe, the Middle East and Africa from 2016 to 2018, which includes an office in Abu Dhabi. That office listed Etisalat as a client, as well as the Abu Dhabi airline Etihad, whose sponsorships were also central to the case, as well as several Abu Dhabi state enterprises.
On top of that, the CAS chairman Rui Botica Santos was also recommended by City. The CAS rules for appeals state that each party chooses one arbitrator, with the chairman being selected by the chairman of the CAS appeals and arbitration division. No explanation was given about why City suggested the chairman for this case, although the judgment did also note that UEFA did not object. It is also worth noting that Premier League charges don’t include any provision to be escalated to CAS.
What’s this ‘time-barred’ thing about, then?
A statute of limitations is a law that sets a time limit for filing civil or criminal charges against someone. After the time limit has passed, proceedings cannot – or should not – move forward regardless of the evidence against the defendant, with the case closed as ‘statute-barred’ or ‘time-barred’. UEFA had rules relating to a statute of limitations built into its rules, but perhaps significantly, the Premier League does not. That defence – which is a full defence against any claims brought against such cases – isn’t going to fly this time.
Have Manchester City themselves made any comment on the subject?
They have. They will have been taken by surprise by this as much as anybody else. It is understood that they were only notified at the same time that the Premier League issued their statement, but it didn’t take the club long to issue a statement of their own. Broadly speaking, they chose to keep their counsel over it all, which is probably the wisest policy they could have followed for now:
‘Manchester City FC is surprised by the issuing of these alleged breaches of the Premier League Rules, particularly given the extensive engagement and vast amount of detailed materials that the EPL has been provided with.
‘The Club welcomes the review of this matter by an independent Commission, to impartially consider the comprehensive body of irrefutable evidence that exists in support of its position.
‘As such we look forward to this matter being put to rest once and for all.’
It should be added that the one thing City was actually punished for by UEFA was not cooperating with its investigation. CAS also reduced the fine for City’s failure to cooperate with UEFA to €10m from €30m. And while they may claim to ‘welcome the review of this matter’, internal documents confirmed that, according to Associated Press, ‘Manchester City threatened to destroy UEFA with legal action when European soccer’s governing body pursued punishment against the Abu Dhabi-owned club for overspending on players and hiding costs.’
What happens next?
A commission will now be appointed by the chair of the Premier League’s Judicial Panel, with proceedings to be held in private and confidentially, with only their final decision published.
How long will this all take?
While your guess may be as good as mine on this, it’s highly likely that this will be an extremely long and drawn-out saga in which the biggest winners will be the lawyers.
Nothing’s going to actually happen here, is it?
Well, that’s the $64bn question. The Premier League’s ‘Big Six’ emerged from the European Super League affair with a light slap on the wrists over their attempts to cleave European football apart for their own selfish ends – which they, somewhat unconvincingly, sought to explain away as some sort of multi-billionaires Fear Of Missing Out – but this was the six richest clubs in England at the same time. On this occasion, although a cold wind may have blown through the corridors of Stamford Bridge this morning, they look somewhat more isolated.
The timing of this is all somewhat… convenient, isn’t it?
It has already been noted that the timing of this announcement, coming at the same time that talk of an independent regulator for football is reaching something of a crescendo, may be considered somewhat convenient for those who would like an opportunity to prove that they can actually regulate the game themselves rather than having to have it foisted upon them.
Of course, this should be considered a separate issue to the question of whether they actually committed the offences with which they’ve been charged, and it might even be considered that the Premier League needs to have been certain to get all its ducks in a row over this case, considering where UEFA’s case against them ended up.
How bad could this get for Manchester City?
It should be said that we are definitely in uncharted territory here, and that the range of sanctions available to the Premier League in the event that Manchester City’s defence is defeated is wide and varied. Sanctions could go as deep as expulsion from the division, though we doubt the governing body would have much of an appetite for a sanction that severe.
In the eventuality that a decisive case is found against City, whatever sanctions are decided upon would set a precedent for any other clubs found guilty of something similar, and that if other clubs are sweating a little over charges being brought against City, then ‘making an example of them’ might end up backfiring on others too.
Points deductions, transfer window bans and fines are also possible, while Pep Guardiola has previously said that he would quit if it were found that his employers had lied to him over financial rule breaches. For all their bullishness, the stakes for City themselves couldn’t be a great deal higher.