PL charge City for alleged breaches of financial rules

[Centurions]

I think people really need to drop this idea that City "will go on the attack".

They won't, if they were going to it would have been better doing so before the clubs name was reputationally damaged.

Out of interest what makes you say this? When do you think we should have 'gone on the attack'?

 

[KS55]

Why would equity funding, regardless where it comes from, be illegal and invalidate the accounts outwith of the poxy Premier League made up rules? Any company Director can put whatever funds they want into a business which could make up for losses, the Tax implication would be positive for the club as far as HMRC us concerned IE make a loss, don’t pay tax on profits.

Agreed tax losses can be run down against future profits for tax purposes. City had a whole raft of them and we paid no corporation tax in subsequent profitable years. Not sure where we are up to with that now.

 

[KS55]

I don’t think fair value has anything to do with anything mate as Etihad isn’t a related party

Correct but see the new PL rules.

 

[hammocity]

Agreed tax losses can be run down against future profits for tax purposes. City had a whole raft of them and we paid no corporation tax in subsequent profitable years. Not sure where we are up to with that now.

We have consistently made a small profit over the past few years but the affected Covid seasons will probably give us (and all others) the opportunity to not pay Corporation Tax as per your post.

 

[KS55]

I agree and our auditors also an agree but I think others more clued up on here who also agree have said that UEFA have had advice to opposite affect.

I don’t think he is but if the Premier league are alleging that the Sheik is funding sponsorship and if they could prove it would that not make then defectors related party ? Even if they wouldn’t normally meet the criteria I mean non related parties wouldn’t inflate sponsorships for companies they where sponsoring via funds from the owner of the company they where sponsoring

I think if the Premier league had proof of anything we would be in trouble a hiding the source of the money and b not calling it related even if we could argue it was not above market rate.

You are rearing the ugly prospect of PL rules clashing with UEFA rules. We agreed with UEFA to follow a certain course of action but if it is part of the PL case that that action was incorrect, we have a right to do on our hands.
The newPL rules on owner funding differ from UEFA rules.

 

[Maly]

Correct but see the new PL rules.

Aren’t the new rules only for new, not existing sponsorships tho?

 

[SilverFox2]

We have consistently made a small profit over the past few years but the affected Covid seasons will probably give us (and all others) the opportunity to not pay Corporation Tax as per your post.

Is there a tax benefit regarding being part of a Holding Company as well?

 

[diamondmonkey]

Clearly that's based on the Mancini Al Jazira contract and I assume they're saying we falsified the accounts by keeping that £1.75m off the books. In the first full year of Mancini's tenure that was about 1% of our turnover, plus we lost nearly £200m.

Even in the event that the commission find that was a dodge, so what? It's completely insignificant. But why would we even try to hide £1.75m in the context of that scale of losses? It's hardly on the Enron scale of fraud.

I presume the PL rule they're citing however is the one where we have to give full details of the manager's remuneration, hence the charge. But they'd need to show that Mancini (and City) had no intention of him fulfilling that contract.

Thanks for the repky

Do you think the 2009-2013 charges are only concerning Mancini’s contract? That you quite rightly say is inconsequential.

Also important to highlight that the PL only charged us with breaking their FFP rules for 3 seasons 2015-2018.

As well as not complying with UEFA FFP regs 2013 - 2018. Though I’m not sure UEFA will want to reinvestigate that period again.

 

[Prestwich_Blue]

I wasn’t convinced. Plenty of references elsewhere to HH meaning Mansour.

There are lots of HH's in Abu Dhabi but even if it was Mansour, the email said "HH will arrange funding", not "HH will provide the funding" or "It will be funded by HH via ADUG".

So Sheikh Mansour or one of his staff could pick up the phone, ring another HH and arrange for the Executive Council to provide the funding to Etihad. But even in the most extreme case, where SM clearly provided the additional funding from ADUG, as long as Etihad were getting full value for the money, and the sponsorship was seen as fair value (which CAS said it was) then even that might not be a problem, as owners are allowed to sponsor clubs under FFP rules. So in that last scenario, which Stefan and me disagreed slightly on, I'd say he was more likely to be right. I always said that if we agreed Etihad was a related party, then there's nothing UEFA could have done.

 

[Prestwich_Blue]

Thanks for the repky

Do you think the 2009-2013 charges are only concerning Mancini’s contract? That you quite rightly say is inconsequential.

Also important to highlight that the PL only charged us with breaking their FFP rules for 3 seasons 2015-2018.

As well as not complying with UEFA FFP regs 2013 - 2018. Though I’m not sure UEFA will want to reinvestigate that period again.

It's mostly the Mancini contract but there might be some player image rights stuff in there as well.