Manchester City will compete in next season’s Champions League after the Court of Arbitration for Sport upheld the club’s appeal against a two-season ban from European competition.
City had been banned from participating in European competition for the next two seasons after being found guilty of breaching UEFA’s Financial Fair Play regulations, also receiving a fine of €30m after being accused of overstating sponsorship deals with companies linked to their Abu Dhabi owners in order to circumvent regulations.
The club had strongly denied any wrongdoing and lodged an appeal to the Court of Arbitration for Sport (CAS), an appeal which has proven successful following the lifting of their ban – though City will still face a fine of €10m to UEFA.
City – who have maintained a position of confidence throughout the appeal process – have released a statement on the announcement welcoming the verdict, their permission to play in next season’s Champions League a huge boost from both a sporting and financial aspect.
Man City were incredibly confident all the way through this, even rejecting a reduced punishment to have their day in court. Seems that confidence was justified, although probably leaves UEFA's FFP rules in tatters.
— Rob Dawson (@RobDawsonESPN) July 13, 2020
“Whilst Manchester City and its legal advisors are yet to review the full ruling by the Court of Arbitration for Sport (CAS), the Club welcomes the implications of today’s ruling as a validation of the Club’s position and the body of evidence that it was able to present. The Club wishes to thank the panel members for their diligence and the due process that they administered.”
The Court of Arbitration for Sport has revealed their reasoning for ruling in City’s favour, with a statement declaring most of the alleged breaches ‘were either not established or time-barred’.
CAS verdict reads: “The CAS award emphasised that most of the alleged breaches reported by the Adjudicatory Chamber of the UEFA Club Financial Control Body (CFCB) were either not established or time-barred.
“As the charges with respect to any dishonest concealment of equity funding were clearly more significant violations than obstructing the CFCB’s investigations, it was not appropriate to impose a ban on participating in UEFA’s club competitions for MCFC’s failure to cooperate with the CFCB’s investigations alone.
“However, considering i) the financial resources of MCFC; ii) the importance of the cooperation of clubs in investigations conducted by the CFCB, because of its limited investigative means; and iii) MCFC’s disregard of such principle and its obstruction of the investigations, the CAS panel found that a significant fine should be imposed on MCFC and considered it appropriate to reduce UEFA’s initial fine by two-thirds, i.e. to the amount of EUR 10 million.”
City’s success raises major question marks surrounding UEFA’s Financial Fair Play regulations, despite the insistence that the rules are here to stay. The success of the appeal to CAS may, however, prompt UEFA into a rethink of the rulings, with the financial limitations intended to protect clubs and ensure they are able to become financially sustainable.
FFP RIP? Not according to Uefa: "Over the last few years, FFP has played a significant role in protecting clubs and helping them become financially sustainable and Uefa and ECA remain committed to its principles." Yet CAS, and Uefa handling of #mcfc case, have badly wounded FFP.
— Henry Winter (@henrywinter) July 13, 2020
UEFA released a statement reading that they had ‘taken note’ of the ruling by CAS, before declaring they remain ‘committed’ to its principles in ensuring clubs are financially sustainable and responsible.
The news of City’s victory also has major implications in the race to secure continental qualification, with the fifth-placed side in the division likely to have been granted entry into the Champions League should the ban have been upheld.
City’s place in next season’s competition means that five sides are now battling out for the final two qualification spots, with just six points separating third-placed Chelsea and Sheffield United in seventh.
The Premier League is also continuing a separate investigation into City’s financial dealings, the league looking into the same allegations as UEFA’s investigation as well as claims over the club’s recruitment of academy players and third-party ownership.