Why Are 2024 Champions Manchester City Suing The Premier League?

By Ian John
June 12, 2024

Why are Manchester City suing the Premier League, citing discriminatory practices against the club? What is their argument? Does it have any merit? And what long-term implications does it have for the competition?

Just a short time after securing their fourth League title in a row, Manchester City stunned many people with a significant announcement. They were to start a legal process that would see Manchester City suing the Premier League

This unprecedented step has shocked many experts. City are currently under investigation for an alleged 115 breaches of Financial Fair Play (FFP).

Manchester City have denied that they have breached any FFP rules.

However, after a season which has seen Everton twice deducted points for single breaches of FFP rules, and Nottingham Forest also deducted points for FFP breaches, City’s potential punishments could be considerably greater. 

Despite this latest development, Pep Guardiola’s team remain the favourites to win the Premier League next season. Bet365 Sport are currently offering 2.10 on City landing a fifth Premier League title in a row. 

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So how has this story developed? Let’s go back in time to discover the story behind the current investigation into Manchester City and their subsequent legal action against the Premier League.

The Backdrop to Manchester City Suing the Premier League

Manchester City’s issues date back to the 2009/10 season up to 2022/23. They began when German newspaper Der Spiegel published an article citing leaked emails to prove that Manchester City had broken several FFP rules. 

The article claimed that Manchester City: 

  • Did not provide accurate information about their revenue for nine years up to 2017.
  • Did not provide accurate details about how much they paid their manager from 2009 to 2013. 
  • Did not provide accurate details about how much they paid some of their players from 2010 to 2016.
  • Did not comply with UEFA FFP Regulations from 2013-2018.
  • Did not comply with Premier League Spending Rules from 2015-2018.
  • From 2018 onwards, have not co-operated with the Premier League’s enquiry into their alleged FFP breaches. 

As part of their investigation, the Premier League have reportedly found 115 instances of FFP breaches.

UEFA had banned Manchester City from European competition for two years and issued a £30m fine back in 2020. 

However, in an appeal to the Court of Arbitration for Sport (CAS), this was reduced to a £10m fine, with some other judgements dismissed as CAS viewed them as being time-barred.

A technicality, which effectively ended UEFA’s case against City.

That ruling does not apply in the Premier League. 

Following the Der Spiegel article, the Premier League found 115 occasions when City allegedly breached FFP.

They were:

  • 54 instances where City failed to provide accurate financial information from 2009 to 2018.
  • 14 instances where City failed to provide accurate details about payments to players and managers from 2009 to 2018.
  • 5 instances where City failed to comply with UEFA rules including Financial Fair Play rules
  • 7 breaches of the Premier League’s Spending Rules (PSR) from 2015 to 2018. 
  • 35 instances of failing to cooperate with the Premier League’s enquiry from 2018 onwards. 

How are Manchester City alleged to have broken FFP rules?

Manchester City

These are serious charges and it was the Der Spiegel investigation that revealed just how Manchester City are alleged to have broken FFP rules. 

Two of the methods City are alleged to have used include: 

  • Paying players or managers considerably more than their stated salary by using other clubs owned by the clubs’ owners to pay off the books ‘consultancy’ fees or similar to the player or manager. For example, Player A’s reported salary at City would be recorded as £100,000 per week on the books, but they would also be paid an additional £100,000 per week from another City Football Group club via a ‘consultancy’ fee or similar, with the extra money being paid by the City owners through one of their other companies or clubs.
  • Inflating the value of sponsorship deals using the owners’ funds. For example, a sponsorship deal with ABC Company would be reported as being worth £30m to the club, but only £1m would actually come from the ABC Company, with the City owners paying the remaining £29m. But this would be recorded on the official company records as a sponsorship deal worth £30m from ABC Company. This practice is alleged to have been used across many sponsorship deals. Inflating the club’s value and allowing them to appear to be within UEFA and Premier League FFP rules. 

The nature of the claims remains uncertain at the moment, but based on the emails received by Der Spiegel, the above examples appear to have triggered the main investigations by UEFA and the Premier League. 

However, Manchester City have gone on the offensive themselves, arguing that they are the victims in this due to Premier League rules penalising them and also railing against the 

What is the claim made by Manchester City for suing the Premier League?

Essentially, Manchester City are arguing that the current Premier League rules regarding Associated Party Transactions (the sponsorship deals listed above) being fair and made to reflect true value are breaking the current law in the UK.

They argue that the rules have been brought in to expressly prevent rich Middle Eastern owners of multiple football clubs from investing in their Premier League team.

They also refer to the “tyranny” of the Premier League ruling where any rule change in the Premier League must be agreed by 14 of the 20 clubs or more.

City are also believed to be suing the Premier League for lost earnings over deals that City have had to shelve or which have failed, due to the rulings they feel are unfair. 

That would mean the Premier League’s shareholders could be forced to pay City a hefty amount of compensation.

Those shareholders are the other 19 teams in the Premier League. 

Does Manchester City’s case against the Premier League have any merit?

City’s legal team certainly think so. However, with the hearing being private, the outcome will be kept private and it will be intriguing to see what happens after the team of three lawyers hear City’s arguments in this case. Newcastle will also be watching the developments in this case closely given that they are owned by the Saudi Private Investment Fund. 

For the other 18 teams in the Premier League, they will be eagerly watching as the outcome of this could impact the future of the competition. 

What are the implications, both in the short and long term for the Premier League should City win their case?

If City win this case, then the implications for the Premier League are bleak.

Shareholders could be forced to pay millions in compensation to City. Not only that, but City would seek a change in rules to allow owners to invest money via Affiliated Third Parties. The upshot of which would give teams such as City a huge advantage over almost all other Premier League teams financially. 

It would also call into question whether the charges City face have any legal basis. This could lead to them being dismissed. 

Should this happen, this could well see the end of the Premier League as it has been since it was first formed and usher in a new era where only the richest teams will be able to dominate. 

Unveiling the Potential Consequences: What If Manchester City Fails to Win the Case? 

Should City’s case be dismissed then City will officially not be in any worse position than they are now.

However, the fact that they have sought to undermine the rules that they are alleged to have been found guilty of breaking, while maintaining their innocence, would not look good. 

The outcome would not likely affect any punishment City would face as a result of the 115 FFP charges they face. 

What they are still to be decided, but this move from City makes it all the more likely that the Premier League is going to have to revisit its rules regarding ATP and FFP with a fine tooth comb in the near future.

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