Manchester City Successfully Appeals Two-Year European Football Ban

On 13 July 2020, an arbitral tribunal constituted under the Court of Arbitration for Sport, in Lausanne, Switzerland, set aside a prior decision of the Adjudicatory Chamber of the Club Financial Control Body of the Union des Associations Européenes de Football (UEFA) that had banned Manchester City Football Club from participating in European football for two years, in addition to a EUR 32 million fine.

In February 2020, the Adjudicatory Chamber ruled that Manchester City contravened UEFA’s Club Licensing and Financial Fair Play Regulations by disguising equity financing as sponsorship money in the 2012-2013, 2013-2014 and 2015-2016 seasons.  The decision followed leaked internal emails published by Der Spiegel, a German magazine.

Under UEFA Regulations, team finances must break even and teams must limit their losses in time and magnitude in order to prevent clubs from overspending rivals.  According to the Adjudicatory Chamber, Manchester City had disguised at least £204 million in equity contributions as sponsorship income in order to contravene those rules.

The arbitral tribunal dismissed all charges against Manchester City except for a charge relating to its failure to cooperate with the investigation into the allegations.  The arbitral tribunal determined that the alleged breaches were either time-barred or not established.  The tribunal stated that the five-year prescription period for breaches of the regulations is not stopped merely by opening an investigation but only when charges were formally brought against the club.  The arbitral tribunal also found that the evidence was insufficient to show that the club disguised equity contributions.  The tribunal overturned the ban on Manchester City’s participation in European football.  For the failure to assist in the investigation, the tribunal reset the size of the fine to a third of its original size.