Image used under license from Shutterstock.com.
Manchester City live in soccer paradise, but their place at the top comes with increased scrutiny as the club is now facing legal repercussions over its alleged violations of the Premier League’s Financial Fair Play (“FFP”) rules.[1] The Premier League, as the name suggests, is the highest tier of England’s domestic soccer league. City have won eight Premier League titles, one Champions League title, three FA Cups, six League Cups, one UEFA Super Cup, and the FIFA Club World Cup since being bought by Sheikh Mansour’s Abu Dhabi United Group in 2008.[2] Today, the City squad is worth a staggering €1.26 billion and enjoys the services of Erling Haaland, the world’s most valuable soccer player (€200 million).[3] But City’s journey to the promised land is not without controversy. In fact, it is rife with it.
The Premier League has levied 115 charges against City for violations of FFP rules.[4] FFP is designed to ensure that clubs spend what they earn, but teams can theoretically get around these rules by inflating revenue or deflating costs.[5] The Premier League’s charges are primarily centered around City’s failure to provide accurate financial information and its failure to comply with Premier League investigations.[6] Specifically, City are accused of injecting revenue by inflating sponsorship deals, as well as hiding costs by failing to declare various salaries and media payments.[7] These alleged breaches took place over nine years from 2009 until 2018.”[8]
The long-anticipated hearing to decide the outcome of City’s alleged FFP breaches began on September 16, 2024, eighteen months after the Premier League brought its initial charges, and is expected to last over a 10-week period.[9] The hearing is not a court case and is conducted privately, with either side able to appeal the verdict.[10] The hearing is overseen by a panel of three members, as selected by Murray Rosen, the chair of the Premier League’s judicial panel.[11] A verdict is expected sometime before the end of the current season, which concludes in May 2025.[12]
This case unofficially began even before the current charges were brought against City. In 2018, a German outlet called Der Spiegel published a series of articles based on the work of a Portuguese computer hacker Rui Pinto, who had hacked into the email accounts of various soccer clubs and agents.[13] The articles were enough to make the Union of European Football Associations (UEFA) conduct its own investigation.[14] However, this current case is separate from UEFA’s, which City ultimately won, because UEFA and the Premier League are separate soccer organizations and governing bodies. The current case has the potential to reach a different conclusion due to the Premier League’s access to further evidence, such as emails and texts.[15]
City are facing fifty-four charges for its alleged failure to provide accurate financial information.[16] In Premier League terms, these charges address City’s alleged failure to release accurate financial information regarding the team’s income and expenses.[17] The Premier League is skeptical as to whether Abu Dhabi-owned City reported the true revenue they were gaining from sponsorship deals with Abu Dhabi-linked companies, or whether they were only declaring part of it.[18] Under Premier League rules, City were expected to provide, “(in) the utmost good faith, accurate financial information that gives a true and fair view of the club’s financial position”.[19]
City are facing fourteen charges for the club’s alleged failure to provide accurate details for player and manager payments.[20] Here, City are charged with hiding money being paid out to players and coaches.[21] The Der Spiegel emails outline multiple high-profile examples of this.[22] One such example involves payments made to former City manager Roberto Mancini via a deal with Abu Dhabi club Al Jazira — owned, like City, by Sheikh Mansour of the United Arab Emirates— which paid him £1.75million annually for a minimum of four days’ work per year.[23] The Premier League will argue this payment constituted part of his salary but was not reported as such, while City will argue this was a separate contract unrelated to his employment as the team’s manager.[24]
In total, the alleged breaches are on an unprecedented scale. Previous cases involving FFP breaches involved single violations, drastically differing from the 115 charges at issue in City’s case.[25]
City have continually professed their innocence ever since their alleged breaches were made public.[26] The club even launched their own legal case against the Premier League for restricting associated party transactions (“ATP”), which allow clubs to sponsor their teams through their other businesses.[27] These transactions allow clubs to earn more revenue, making it easier to comply with FFP – the less restrictions, the more team ownership can use their other businesses to provide money to their teams through sponsorships, endorsements, and media deals.[28] City’s case against the Premier League regarding ATP transactions was recently decided.[29] City claims victory because the tribunal deciding the case concluded that two of the Premier League’s ATP regulations were unlawful.[30] However, the Premier League is also claiming victory because the tribunal dismissed the majority of City’s objections and endorsed the overall objectives and framework of the APT system. [31]
Blackstone Chambers barrister Lord Pannick and his clerk will be leading Manchester City’s legal team, which also includes barristers from Serle Court, a prominent UK law firm.[32] Adam Lewis and other barristers are representing the Premier League.[33]
This case, which is finally culminating in a resolution, is six years in the making. City winning this case, or even having any success, could enable similarly situated clubs, especially state-owned clubs, to gain further financial advantages through APTs.[34] Still, City could suffer greatly from an unfavorable ruling: “their punishment could be anything from fines, points deductions, exclusion from certain competitions, relegation from the Premier League and maybe the scrapping of title wins.”[35]
[1] Manchester City: What to know about the hearing and charges, REUTERS(Sep. 16, 2024, 4:03 AM), https://www.reuters.com/sports/soccer/soccer-hearing-into-manchester-citys-alleged-breaches-premier-league-rules-2024-09-16/.
[2] Id.
[3] Manchester City – Club Profile, TRANSFERMARKT, https://www.transfermarkt.us/manchester-city/startseite/verein/281 (last visited Oct. 19, 2024).
[4] Jacob Whitehead, Manchester City vs the Premier League – explaining the 115 charges and how long the case will take, THE ATHLETIC(Sep. 15, 2024), https://www.nytimes.com/athletic/5762324/2024/09/16/manchester-city-charges-explained/?redirected=1.
[5] Kaveh Solhekol, Man City Premier League charges explained: What are they? What could punishment be? What’s the timescale?, SKY SPORTS (Sep. 16, 2024, 10:48 AM), https://www.skysports.com/football/news/11679/12804623/man-city-premier-league-charges-explained-what-are-they-what-could-punishment-be-whats-the-timescale.
[6] Supra note 3.
[7] Id.
[8] Id.
[9] Supra note 4.
[10] Supra note 1.
[11] Supra note 4.
[12] Id.
[13] Der Spiegel Staff, Manchester City Exposed, SPIEGEL INTERNATIONAL (May 11, 2018, 1:00 PM), https://www.spiegel.de/international/manchester-city-exposed-bending-the-rules-to-the-tune-of-millions-a-1236346.html.
[14] Manchester City’s Court Hearing Begins, LAWYER MONTHLY (Sep. 17, 2024), https://www.lawyer-monthly.com/2024/09/manchester-citys-court-hearing-begins/.
[15] Supra note 3.
[16] Id.
[17] Isaac Seelochan, What are Man City’s 115 charges? Full list as Premier League hearing date set, MANCHESTER EVENING NEWS (Sep. 12, 2024, 4:08 PM), https://www.manchestereveningnews.co.uk/sport/football/football-news/man-city-charges-full-latest-29067355.
[18] Supra note 3.
[19] Supra note 16.
[20] Supra note 3.
[21] Id.
[22] Supra note 12.
[23] Supra note 3.
[24] Id.
[25] Id.
[26] Kaveh Solhekol, Man City vs Premier League Q&A: What now after legal case over Associated Party Transaction rules?, SKY SPORTS (Oct. 8, 2024, 9:47 am), https://www.skysports.com/football/news/11661/13230129/man-city-vs-premier-league-q-a-what-now-after-legal-case-over-associated-party-transaction-rules.
[27] Id.
[28] Id.
[29] Id.
[30] Id.
[31] Id.
[32] Man City’s hearing for 115 charges begins, BBC SPORT (Sep. 16, 2024), https://www.bbc.com/sport/football/articles/c1d7drg10nwo.
[33] Id.
[34] Jonathan Johnson, Breaking down Manchester City’s fight against the Premier League and 115 alleged violations of financial rules, CBS SPORTS (Aug. 13, 2024, 11:46 AM), https://www.cbssports.com/soccer/news/breaking-down-manchester-citys-fight-against-the-premier-league-and-115-alleged-violations-of-financial-rules/.
[35] Supra note 13.