Manchester City ban lifted: Financial Fair Play take major hit

Manchester City have successfully overturned a 2-year ban from European competitions.

The Court of Arbitration for Sport (CAS) on July 13, 2020, upheld City's appeal against a ban by European football's governing body, UEFA, but imposed a fine of 10 million euros ($11.3m) for failing to cooperate with investigators.

The urgent ruling by 3 judges came one month after a 3-day hearing held by video link between Switzerland and England. A full verdict detailing the evidence, expert witness testimony, and the judges' reasons are unlikely to be published for at least several weeks.

The verdict clears the team coached by Pep Guardiola to play in the group stage of the Champions League, European football's top club competition, next season.

The case does not affect City's place in this season's competition, which resumes next month.

City's win guarantees tens of millions of dollars in UEFA prize money next season. It also protects against players leaving to seek Champions League action with another club.

City were handed the ban and fined 30 million euros ($34m) by UEFA in February for "serious breaches" of rules monitoring club finances and failing to cooperate with investigators. The allegations included that the club misled UEFA over several years to meet financial integrity rules - known as Financial Fair Play (FFP) - required to enter European club competitions.

City denied wrongdoing and said it had "irrefutable evidence" the claims were not true.

UEFA-appointed investigators opened a case after leaked club emails and documents from City officials were published by German magazine Der Spiegel in November 2018.

They were likely obtained by a hacker from Portugal.

The published evidence appeared to show City deceived UEFA by overstating sponsorship deals from 2012-16 and hid the source of revenue linked to state-backed companies in Abu Dhabi.

Manchester City never disputed the documents were authentic but argued the evidence was stolen and reported out of context.

UEFA had previously signed off on City’s submitted accounts since 2014.

That year, UEFA fined City 20 million euros ($22.6m) of its Champions League prize money in the first wave of assessments of European clubs' finances.

City’s victory has put the UEFA and their FFP under scrutiny yet again.

When City were banned back in February this year, former England right-back and now an expert in Sky Sports predicted, “I think City will beat FFP. I have no confidence in UEFA to be able to do the right thing. I think it will be overturned. I have no faith in them whatsoever, I think they are hopeless organization who just apply erratic disciplinary sanctions. I think City will beat them in the courts. It will get stuck in the courts for some time, but I think City will win in the end”.

When a lot of speculations were going on and a shadow of doubts was cast over City’s immediate future, Neville gave all those no importance, but confidently stated about the outcome and today it all came true.  

The UEFA Financial Fair Play Regulations (FFP) was established to prevent professional football clubs spending more than they earn in the pursuit of success and in doing so getting into financial problems that might threaten their long-term survival.

The regulations provide for sanctions to be taken against clubs who exceed spending, over several seasons, within a set budgetary framework. Implementation of the regulations took place at the outset of the 2011–12 football season.

The severest penalty is disqualification from European competitions.

Other penalties included fines, the withholding of prize money, and player transfer bans.

But since it came into action, it was never without a question mark and sparked widespread criticisms.

One of the major criticisms of FFP is the possibility of solidifying the so-called big clubs which generate the largest revenue and profits, and can consequently spend more money on transfers.

Martin Samuel of the Daily Mail has criticized FFP, believing they will create a procession instead of competition and has compared the regulations to “a giant drawbridge that is being pulled up”.

Samuel believed Manchester City's £194 million loss in 2010–11 was justified, with the club having to spend big to get lucrative Champions League football before the “door closes”.

Qualification and participation in the Champions League is regarded as a lucrative affair and can earn clubs up to £60 million in prize money and television rights a season if a club makes it to the final.

 A club only has to play 13 matches from the group stages to reach the final. In comparison, finishing bottom of the Premier League is now worth £175 million, but is won over 38 matches.

The financial gulf between successful clubs in the top-tier of a European league has had an impact domestically, most notably in the Premier League, where for approximately a dozen years (from 1996 to 2008) there had been an almost complete dominance of the three major domestic English competitions by just four clubs (Arsenal, Liverpool, Chelsea, and Manchester United).

During this period, the lack of competition for lucrative Champions League football in England from outside of those four clubs was frequently criticized. More recently, however, the grip on the four top places in the Premier League - that enable automatic entry into the Champions League competition - by the incumbent ‘Big 4’ clubs has been heavily eroded in more recent seasons due to the rise in competitive performance of both Tottenham Hotspur and Manchester City and the relative decline of Chelsea, Arsenal and Manchester United.

Since the 2015-2016 season the original ‘Big 4’ clubs have gained no more than 2 of the top 4 positions each year.

City emerged as one of the most influentials in the scene.

CAS said its full legal ruling, with details of the case and the decision, would be published in the coming days.

“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”, City said in a statement.

UEFA had said City had committed “serious breaches” of the FFP rule in the information submitted to them between 2012 and 2016.

However, Article 37 of UEFA’s own procedural rules covering the CFCB states that “Prosecution is barred after five years for all breaches of the UEFA Club Licensing and FFP Rules”.

UEFA said it remained committed to FFP.

“UEFA notes that the CAS panel found that there was insufficient conclusive evidence to uphold all of the CFCB’s conclusions in this specific case and that many of the alleged breaches were time-barred due to the 5 year time period foreseen in the UEFA regulations.

“Over the last few years, Financial Fair Play has played a significant role in protecting clubs and helping them become financially sustainable, and UEFA and ECA (European Club Association) remain committed to its principles.”

The decision led Javier Tebas, president of the Spanish league and long-standing critic of City, to question the role of CAS in such decisions.

“We have to reassess whether the CAS is the appropriate body to which to appeal institutional decisions in football. Switzerland is a country with a great history of arbitration, the CAS is not up to standard,” he told reporters.

City overcame the scare and how did they overcome this, someone like Neville statted a few months back, which only demands modification of rules of UEFA FFP and also doubts it’s active existence in the near future.

Note: This article has been posted at Cricketsoccer as CSdesk on 13/07/2020 Manchester City ban lifted: Financial Fair Play take major hit  

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Faisal Caesar