The Court of Arbitration for Sport (CAS) has finally given his final verdict on the two-year European ban slammed on Manchester City by UEFA for breaching UEFA‘s Financial Fair Play (FFP) rules. CAS has ruled that the decision taken by UEFA’s Club Financial Control Body (CFCB) to ban the Premier League club from featuring in any European competition from next season, should be lifted and the €30 million fine be reduced to €10 million.
In a statement issued on Monday morning to announce the verdict, CAS wrote: “The case concerns an appeal filed by Manchester City FC (MCFC) against the decision of the Adjudicatory Chamber of the UEFA Club Financial Control Body (CFCB) dated 14 February 2020 in which it was deemed to have contravened UEFA’s Club Licensing and Financial Fair Play Regulations and sanctioned with exclusion from participation in UEFA club competitions in the next two seasons and ordered to pay a fine of EUR 30 million.
“The Panel of arbitrators in charge of the matter, composed of Mr Rui Botica Santos (Portugal), President, Prof. Ulrich Haas (Germany) and Mr Andrew McDougall QC (France), conducted a hearing with the parties, their legal representatives, witnesses and experts on 8, 9 and 10 June 2020.
“Following the hearing, the CAS Panel deliberated and concluded that the decision issued on 14 February 2020 by the Adjudicatory Chamber of the CFCB should be set aside and replaced by the
a.) MCFC has contravened Article 56 of the Club Licensing and Financial Fair Play Regulations.
b.) MCFC shall pay a fine of EUR 10,000,000 to the UEFA, within 30 days as from the date of issuance of the arbitral award.
The CAS award emphasized that most of the alleged breaches reported by the Adjudicatory Chamber of the 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.”
How Manchester City got to this!
In November 2018, a German magazine, Der Spiegel, published leaked documents of Manchester City which served as evidence that the Premier League club had been putting money into the account of the club disguising that the money was coming from a sponsor. The leaked documents also showed proved that City’s main sponsor Etihad Airways was paying just £8 million from £67m sponsorship agreement.
All these pointed to the fact that Manchester City manipulated the FIFA Fair Play rules to suit the club’s interest. Hence, UEFA’s Club Financial Control Body weighed in on the accusation and started investigating the claims of the magazine.
Manchester City were not pleased that the control body had to base their investigation on the publication of a magazine, hence, they had to drag the body to CAS, urging the court to stop the investigation. While CFCB argued that City didn’t cooperate with the body during the investigation. Afterwards, CAS ruled in favour of the UEFA body in November 2019 and the investigation continued.
After about 14 months, CFCB completed their investigation and announced in February 2020 that Manchester City were found guilty of breaching Uefa’s Financial Fair Play regulations. The control body said City overstated sponsorship revenue and break-even information in accounts submitted to UEFA between 2012 and 2016.
Besides the two-year European ban slammed on the team, they were punished with €30 million fine.
Days later, Manchester City dragged UEFA to CAS to appeal the judgement insisting that the club had not committed irregularities and hence, their punishment should be overturned. Due to the coronavirus pandemic, the hearing of the case was done via video conference from 8 June to 10 June 2020.
What Manchester City would have lost if the two years ban stood.
If Manchester City had been banned, they would have still be allowed to complete this season’s UEFA Champions League. They will face Real Madrid at the Etihad Stadium on 7th or 8th of August for the second leg of the last 16. City won the first leg 1-2 in Madrid before the coronavirus break.
However, they would have found it difficult to attract the best legs to the club during this transfer window or the subsequent ones. This would have continued until the ban expired. It would have tempted some of their star players to leave for a club where they can be part of Champions League football next season.
In terms of financial loss, Manchester City would have lost £100 million in revenue for not participating in the Champions League.
What City would have gained if the ban had stood
The only thing that Manchester City would have gained if the ban had stood was that they would have had the chance to concentrate fully on domestic competitions especially the Premier League.