Premier League charges Man City over alleged financial rule breaches
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[February 07, 2023]
By Simon Jennings
(Reuters) -The Premier League has referred Manchester City to an
independent commission over more than 100 alleged breaches of
finance rules since the club were acquired by the Abu Dhabi-based
City Football Group.
The referral came weeks before the expected publication of a
government white paper set to recommend the establishment of an
independent regulator in English soccer to deal with the game's
finances, club ownership and corporate governance.
City, the world's highest revenue-generating club last season
according to Deloitte, are alleged to have committed multiple
financial breaches between 2009 and 2018, the league said on Monday.
League rules state that charges such as those faced by City could,
if proved, result in a club being expelled from the Premier League
in the worst-case scenario.
Offending clubs may alternatively be deducted points, fined or
reprimanded.
While it remains to be seen what sanctions the commission imposes on
City, a stricter stance by the Premier League on club finances could
deter potential investors in clubs like Manchester United, according
to a sports finance lawyer.
Both Manchester United and Liverpool are seeking new investors, in
large part due to Middle Eastern investment in clubs such as City
and Newcastle United and the collapse of a planned Super League,
industry experts have told Reuters.
City, who were acquired by City Football Group in 2008, are also
charged with failing to cooperate with the Premier League's
investigation, which was launched in December 2018.
City are alleged to have breached rules relating to the provision of
accurate financial information, "in particular with respect to its
revenue (including sponsorship revenue), its related parties and its
operating costs", the league said.
The club, who have won the Premier League title six times since the
Abu Dhabi takeover, said they were surprised by the league's
"issuing of these alleged breaches".
"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," City
added.
The charges stem from a Premier League investigation into City's
financial dealings launched four years ago, after the release of a
tranche of "Football Leaks" documents obtained by the German
publication Der Spiegel.
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Soccer Football - Premier League -
Manchester City v Brighton & Hove Albion - Etihad Stadium,
Manchester, Britain - October 22, 2022 Manchester City chairman
Khaldoon Al Mubarak before the match Action Images via Reuters/Molly
Darlington
SUBSEQUENT BAN
City were subsequently banned from the Champions League by European
governing body UEFA for two years, but successfully appealed to the
Court of Arbitration for Sport (CAS), which overturned the ban in
2020.
The club were fined 30 million euros ($32.28 million) by UEFA, which
CAS reduced to 10 million euros.
In addition to the charges relating to the club's revenue and
operating costs, City are also alleged to have not fully disclosed
managerial remuneration from 2009 to 2013, when Roberto Mancini was
manager.
The club are also charged with failing to comply with Premier
League's rules requiring clubs to follow UEFA's financial fair play
(FFP) regulations from 2013 to 2018 and failing to follow the
Premier League's rules on profit and sustainability from 2015 to
2018.
FFP regulations are designed to stop clubs running up big losses
through spending on players. They also ensure sponsorship deals are
based on their real market value and are genuine commercial
agreements -- and not ways for owners to pump cash into a club to
get around the rules.
"The proceedings before the Commission will... be confidential and
heard in private," the Premier League said in a statement.
"The Premier League will be making no further comment in respect of
this matter until further notice."
($1 = 0.9295 euros)
(Reporting by Simon Jennings in Bengaluru; additional reporting by
Andres Gonzalez and Amy-Jo Crowley in London; Editing by Ed Osmond)
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