UEFA FFP investigation - CAS decision to be announced Monday, 13th July 9.30am BST

[petrusha]

That seemed pretty clear to me - no deal was re-valued, so there cannot have been any related party decision.

Theoretically, they might have continued to insist that the UAE sponsors were related parties but conceded that the two second-tier sponsorships in dispute were concluded at a fair market value after all. In practice, you're right and it's extremely likely that they backed down on the related parties point, which was much their weaker argument of the two.

 

[Pablo ZZZ Peroni]

If UEFA had accepted that the spo0nsors were related parties, the two sponsorships in question could have been reduced to fair market value, which was assessed by UEFA's auditors as about GBP 12 million less annually than was actually paid across the two deals. UEFA chose not to reduce the value even though clearly had issues with those sponsorships, as is evidenced by the fact that they negotiated for an undertaking with respect to them to be included in the settlement agreement.

UEFA don't need to confirm anything. Their actions tell us all we need to know, and clearly point to UEFA backing down from the position that state-owned UAE sponsors are related parties.

Agree and, has been said before, they changed the rules in 2015 to deal with the related or not related issue and to overide IAS24 in certain conditions:

Under the updated regulations, any entity that, alone or in aggregate together with other entities which are linked to the same owner or government, represent more than 30% of the club's total revenues is automatically considered a related party.

PB continues to make the point on twitter that if we opted to treat all UAE sponsorships as related there wouldn't be a problem now anyway on the grounds Etihad was fair market value and if the other lower tier sponsorships were at FMV we would still pass FFP now.

 

[dario2739]

Theoretically, they might have continued to insist that the UAE sponsors were related parties but conceded that the two second-tier sponsorships in dispute were concluded at a fair market value after all. In practice, you're right and it's extremely likely that they backed down on the related parties point, which was much their weaker argument of the two.

What is the actual rule for 'related parties', as there are many teams who are sponsored by their owners – Leicester are sponsored by King Power, both shirt and ground sponsorship, and that's their (late) owner's company, similarly Bayern Munich are sponsored by Adidas, Allianz etc., all of whom have shares in the club.

 

[dickie davies]

What is the actual rule for 'related parties', as there are many teams who are sponsored by their owners – Leicester are sponsored by King Power, both shirt and ground sponsorship, and that's their (late) owner's company, similarly Bayern Munich are sponsored by Adidas, Allianz etc., all of whom have shares in the club.

Stoke with BET365 :-)

 

[roxy]

What is the actual rule for 'related parties', as there are many teams who are sponsored by their owners – Leicester are sponsored by King Power, both shirt and ground sponsorship, and that's their (late) owner's company, similarly Bayern Munich are sponsored by Adidas, Allianz etc., all of whom have shares in the club.

The rule seems to be that related parties can sponsor their clubs as long as they pay what would be considered a fair price if it were paid by an unconnected party.

 

[JGL07]

The rule seems to be that related parties can sponsor their clubs as long as they pay what would be considered a fair price if it were paid by an unconnected party.

Is anyone seriously arguing that the Etihad sponsorship (post 2012) is more than any other sponsor would pay?

 

[roxy]

Is anyone seriously arguing that the Etihad sponsorship (post 2012) is more than any other sponsor would pay?

According to Der Spiegel even UEFA were happy with the Etihad deal at the time. So not even they are arguing that.

 

[George Hannah]

Straight from the scouse mouth


There is one noteworthy case that has Uefa’s top executives united in anger: Manchester City. Revelations in multiple media outlets, in a series of articles dubbed “Football Leaks”, suggest the English club has artificially inflated the value of sponsorship deals with undeclared additional funding from its owner, Sheikh Mansour bin Zayed al-Nahyan, the billionaire businessman and member of the Abu Dhabi royal family.

Leaked internal documents also suggest City set up a shell company to pay players for “image rights” in an effort to take millions of pounds off its wage bill, as well as other measures designed to deceive Uefa’s investigators. If proven true, the measures would amount to a systematic and conscious effort to evade FFP. Manchester City said it welcomed Uefa’s decision to open a new probe into the allegations as “an opportunity to bring to an end the speculation resulting from the illegal hacking and out of context publication of City emails”. Many Uefa officials say the organisation is taking the claims seriously. But its investigation may hinge on whether Uefa can obtain the leaked internal materials in a way that City cannot challenge on grounds they may first have been obtained illegally.

Thanks to financial fair play, European football is healthier than ever Aleksander Ceferin, Uefa president
A person close to Uefa’s leadership insisted they were determined to get hold of the leaked documents, potentially by asking for them from prosecutors in a number of European countries who are also investigating issues related to the case. The person added it could yet ask for help from Rui Pinto, a Portuguese whistleblower named as the source of the leaks given to media outlets. However, Mr Pinto is facing extradition from Hungary back to his home country on charges related to alleged computer hacking. His lawyers did not respond to requests for comment. Other sporting authorities have opened investigations into Manchester City related to the “football leaks” revelations; including the Football Association, the governing body of the game in England; Fifa, the global governing body; and the Premier League.

While the facts of each case are different, a common thread appears to be a determination by some teams not to accept the authority of the FFP regime. Whereas small clubs comply with Uefa’s rulings, big sides with the financial resources to employ large legal teams can fight Uefa’s decisions or employ creative schemes to avoid punishment for overspending.

 

[Kinkys Left Foot]

Bit out of date that, Mr Pinto has been extradited and is awaiting trial. I doubt he's too peturbed facing hacking charges, I believe it's extortion and blackmail he should be really worried about? I like the end bit crying about creative schemes. It's an admission what we did wasn't against the rules. Oh and plenty of small clubs have been done for not complying, more than larger ones I believe, so that bit was made up. I'm not even sure that Pinto ever had the actual emails. His story indicated some software text crunched material as there was that much of it, to provide extracts which were retrievable by a specific search engine. Not to say UEFA couldn't have asked City for them however even our mail server at work disposes of emails after 2 years automatically. Be a bit presumptuous to expect us to still have them I would say.

 

[petrusha]

I like the end bit crying about creative schemes. It's an admission what we did wasn't against the rules.

Exactly. UEFA has created a set of measures based on legal provisions and accounting regulations common in the corporate world, yet bleat when clubs employ measures common in the corporate world to operate their business to its best effect in the context of the regulations. As a regulator, if UEFA didn't want that, they should accept that they didn't draft the FFP rules properly and, if necessary, amend them for the future. @Pablo ZZZ Peroni helpfully points out one such amendment above.

Of course, the press coverage surrounding this issue has been pathetic, with no recognition of the fact that the leaked material could reveal wrongdoing on City's part but, equally, is entirely consistent with an interpretation that City were looking for lawful regulatory workarounds in a way that countless legitimate, reputable businesses do across the globe every single day. There also seems to be a simplistic belief in the press that, because a course of action was discussed in correspondence, it must inevitably have been carried through. That's not the case, I assure you.

As I recall, back in the initial assessment period, we were scrabbling around looking for any measures we could find to avoid punishment by meeting the strict financial target that would have allowed us to disregard expenses on player wages paid under contracts entered into before 2010. But that period is covered by the settlement agreement and the Der Spiegel revelations don't seem to contain any "revelations" that post-date the settlement. Presumably, if there had been anything post-2014, we'd have been charged with that because it would be easier to make stick given the presence of the agreement covering the earlier period.

So instead, they've had to look for something of which they were unaware pre-2014 and which they therefore didn't take into account when concluding the settlement agreement. What they found is a suggestion that ADUG might have been paying the Etihad sponsorship, thus funnelling shareholder funding into the club and misrepresenting the source of the funds. But, as @Kinkys Left Foot discussed yesterday in another thread, unless there's further evidence that's not in the public domain, the basis for imposing a ban on us that will cost us GBP 80 million (if it's one season) seems extraordinarily flimsy.