Manchester City have been cleared to play in next season’s Champions League by the Court of Arbitration for Sport.
City were handed a two-year ban from European competition in February after UEFA’s club financial control body (CFCB) found they had breached club licensing and Financial Fair Play (FFP) regulations.
The CFCB said they had overstated sponsorship revenue in their accounts and in the break-even information submitted to UEFA for the period between 2012 and 2016.
However, CAS lifted the suspension on Monday, as it found City had not disguised equity funding as sponsorship and that most of the allegations against them were “either not established or were time-barred”.
It did find they had breached Article 56 of the club licensing and FFP regulations by failing to co-operate with the CFCB’s investigation. The club’s initial 30 million euro fine imposed by the CFCB was reduced to 10m euros (just under £9m) by CAS.
City welcomed the news as a “validation” of their position, while UEFA said that it and the European Club Association remain committed to the principles of FFP.
The system is intended to ensure clubs only spend what they earn, to ensure their long-term viability.
UEFA takes note of the decision taken by the Court of Arbitration for Sport to reduce the sanction imposed on Manchester City FC…— UEFA (@UEFA) July 13, 2020
CAS said its final award and the reasons would be published in the next few days.
City, whose appeal to CAS was heard over three days last month, issued a statement welcoming “the implications” of the ruling.
The statement read: “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.”
UEFA said it “took note” of the decision, adding: “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 five-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 remain committed to its principles.
“UEFA will be making no further comments on the matter.”
Under Article 37 of the procedural rules governing the CFCB, it is stated that: “Prosecution is barred after five years for all breaches of the UEFA club licensing and Financial Fair Play regulations.”
The allegations against City – that the club were overstating sponsorship revenue – first surfaced in German magazine Der Spiegel.
The club immediately and vociferously denied the claims, but the investigatory chamber of the CFCB opened a case in March last year.
City launched an initial appeal to CAS to halt the investigation but in November last year that was ruled inadmissible, because the conclusions of the investigation were not known at that point.
LaLiga president Javier Tebas said the decision proved CAS was “not up to standard”.
“We have to reassess whether the CAS is the appropriate body to which to appeal institutional decisions in football,” he said.
“Switzerland is a country with a great history of arbitration, the CAS is not up to standard.”
The Premier League opened its own investigation into allegations of FFP breaches against City in March last year. It had no comment to make on that probe on Monday.
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