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

[laserblue]

AC Milan and Manchester City have both been barred from European football for breaking the rules, although the latter have launched an appeal to the Court of Arbitration for Sport, which will begin next week.

I'm not sure whom you're quoting but the nonsense that Milan were "barred from European football" was exactly the sort of misinformation peddled by the likes of Talkshite.

Milan weren't banned at all. They requested permission to withdraw from the Europa League and UEFA granted their request to enable them to 'get their finances in order' (i.e. keep overspending). UEFA had a well advanced case against Milan for serious FFP breaches around 2016 but because Milan had been allowed to withdraw from the Europa League UEFA immediately scrapped their investigations and Milan got away scot free.

Milan therefore benefited, as did Liverpool in 2013, from the rule that if you don't play in European competitions you can't be sanctioned for FFP breaches.

 

[petrusha]

So, I'm struggling after nearly two years to understand what City has done which constitutes "serious breaches" of UEFA's regulations. I need help to see whether I am anywhere near seeing the case clearly.

Back in 2013 Etihad were unable to afford the full cost of the instalment due on their sponsorship agreement with the club, though our accounts record the payment as made in full by the airline. A hacker stole unlimited numbers of emails, some of which were stolen from City and it was one of these which Der Spiegel chose to publish. Parts of the email were blacked out but the email was from an important executive at the club and it claimed that "HH" would have to meet much of the cost of the sponsorship for that year. UEFA argue that "HH" is Sheikh Mansour and that the sponsorship is simply a means to disguise owner investment. City argue that "HH" is not Sheikh Mansour at all as anyone with knowledge of protocol in the UAE would know and so there has been no owner investment and no disguise. Negotiations in the USA about state funding of airlines give support to City's contention and Etihad have issued a statement saying that they met all the obligations of the sponsorship.

If that outline is correct an email is of no weight whatsoever, especially in redacted form, because it isn't any kind of record of what actually happened. The explicit claim that this was disguised owner investment almost certainly broadens City's case to argue that FFP is inconsistent with commercial/competition law and therefore there is no case to answer.

Like PD I am at a loss to imagine how UEFA can prove (rather than simply suspect as I think they do) that City have breached the regulations. And yet the judgement may not be made public for 3 months?!

There's also an email referred to in the Der Spiegel materials and sent from City's CFO to Simon Pearce asking which model applies out of two the sender cites for the flow of the Etihad sponsorship funds. Both of these involve an entity or individual the sender names 'ADUG Shareholder', and given that the sole shareholder of ADUG is Sheikh Mansour then this does make it sound as though Mansour is routing money into City via the Etihad sponsorship.

But this email gives rise to plenty of questions, not least how Pearce replied. Der Spiegel doesn't quote it and yet, without seeing what it says, it's impossible to offer a proper interpretation of the original email.

Then there's the fact that the money is shown in City's accounts (one presumes) as coming from Etihad in relation to a contract we know MCFC entered into with Etihad for a sponsorship fee acknowledged by UEFA's expert assessors as representing a fair value, and we know that City have performed their obligations under the contract (e.g. Etihad has been the shirt sponsor throughout the term of the contract). So if ADUG has routed shareholder funds via Etihad, this has been at the expense of revenue under a legitimate and fairly valued sponsorship contract, meaning there's no financial benefit to the club in this arrangement, just to Etihad.

In this event, surely any breach (and the evidence of one is very flimsy) is purely technical. The idea that it should merit a two-year ban seems laughable, really - unless there's more evidence we don't know about.

 

[slbsn]

There's also an email referred to in the Der Spiegel materials and sent from City's CFO to Simon Pearce asking which model applies out of two the sender cites for the flow of the Etihad sponsorship funds. Both of these involve an entity or individual the sender names 'ADUG Shareholder', and given that the sole shareholder of ADUG is Sheikh Mansour then this does make it sound as though Mansour is routing money into City via the Etihad sponsorship.

But this email gives rise to plenty of questions, not least how Pearce replied. Der Spiegel doesn't quote it and yet, without seeing what it says, it's impossible to offer a proper interpretation of the original email.

Then there's the fact that the money is shown in City's accounts (one presumes) as coming from Etihad in relation to a contract we know MCFC entered into with Etihad for a sponsorship fee acknowledged by UEFA's expert assessors as representing a fair value, and we know that City have performed their obligations under the contract (e.g. Etihad has been the shirt sponsor throughout the term of the contract). So if ADUG has routed shareholder funds via Etihad, this has been at the expense of revenue under a legitimate and fairly valued sponsorship contract, meaning there's no financial benefit to the club in this arrangement, just to Etihad.

In this event, surely any breach (and the evidence of one is very flimsy) is purely technical. The idea that it should merit a two-year ban seems laughable, really - unless there's more evidence we don't know about.

This has always been at the nub for me. The audited accounts do not support the emails/documents or rather the emails conflict with the audit. This means that either the auditors have been mislead (a super serious situation and allegation) or the emails are only a partial picture and in any event do not represent where the legal routing of funds put the cash. UEFA can't show the accounts are fraudulent in the AC or CAS - its simply impossible. They have neither the access they need nor the time, witnesses, documents etc. Its not the correct forum for doing so.

So UEFA are left with somehow proving the emails (and anything else they have got) PROVE the accounts are incomplete. And CAS only need to consider this question if UEFA succeeds in showing:

1. UEFA is entitled to make determinations or to allege any breaches in respect of periods prior to the reporting period 2016-17, being periods covered by the 2014 Settlement Agreement;
2. UEFA is entitled to make determinations or to allege any breaches in respect of any time prior to 16 May 2014 being five years prior to the date of the Referral Decision; and
3. UEFA is entitled to make determinations or to allege any breaches of the UEFA CL&FFPR in respect of periods prior to the reporting period 2016-17, being outside of the current monitoring period.

So the hurdles seem big for UEFA but how has it got this far?

 

[deano ou812]

This has always been at the nub for me. The audited accounts do not support the emails/documents or rather the emails conflict with the audit. This means that either the auditors have been mislead (a super serious situation and allegation) or the emails are only a partial picture and in any event do not represent where the legal routing of funds put the cash. UEFA can't show the accounts are fraudulent in the AC or CAS - its simply impossible. They have neither the access they need nor the time, witnesses, documents etc. Its not the correct forum for doing so.

So UEFA are left with somehow proving the emails (and anything else they have got) PROVE the accounts are incomplete. And CAS only need to consider this question if UEFA succeeds in showing:

1. UEFA is entitled to make determinations or to allege any breaches in respect of periods prior to the reporting period 2016-17, being periods covered by the 2014 Settlement Agreement;
2. UEFA is entitled to make determinations or to allege any breaches in respect of any time prior to 16 May 2014 being five years prior to the date of the Referral Decision; and
3. UEFA is entitled to make determinations or to allege any breaches of the UEFA CL&FFPR in respect of periods prior to the reporting period 2016-17, being outside of the current monitoring period.

So the hurdles seem big for UEFA but how has it got this far?

Quite simply they’ve been pressurised/pushed into this by outside influences ..

 

[slbsn]

Quite simply they’ve been pressurised/pushed into this by outside influences ..

Thats just not good enough for me. If you believe that, City definitely win at CAS. I think there is some wishful thinking in the whole conspiracy theory stuff.

 

[Colin Bells Boots]

Thats just not good enough for me. If you believe that, City definitely win at CAS. I think there is some wishful in the whole conspiracy theory stuff.

Genuine question - do you not believe that certain members of the G14 have been driving UEFA into this situation ?

 

[slbsn]

Genuine question - do you not believe that certain members of the G14 have been driving UEFA into this situation ?

Not just the G14. Many clubs will have stuck their oar in - this is a competitive, commercial industry. But that pressure does not equate to convincing the AC of UEFA to sanction City with the flimsiest of cases that they know will be appealed at CAS (and beyond if need be). That makes no sense. The AC must, in my view, believe they have at least an arguable case.

 

[KS55]

Thats just not good enough for me. If you believe that, City definitely win at CAS. I think there is some wishful thinking in the whole conspiracy theory stuff.

I believe G14 clubs have cooperated (not conspired!) in attempts to derail City and, of course, G14 have largely captured Uefa. It is a small step logically to suspect that corridor conversations have influenced Uefa's actions. For example, Yves Leterme probably visited Bayern on a regular basis as a member of their 'Sustainability Board' and Bayern have kept up a campaign suggesting that City have caused transfer fee inflation. Surely those parties talked about these matters?
But this cooperation is almost impossible to prove. Unless, unless...... Khaldoon said: "When people say things, we know". Khaldoon has access to a very smart intelligence service. Do we know something?

 

[slbsn]

I believe G14 clubs have cooperated (not conspired!) in attempts to derail City and, of course, G14 have largely captured Uefa. It is a small step logically to suspect that corridor conversations have influenced Uefa's actions. For example, Yves Leterme probably visited Bayern on a regular basis as a member of their 'Sustainability Board' and Bayern have kept up a campaign suggesting that City have caused transfer fee inflation. Surely those parties talked about these matters?
But this cooperation is almost impossible to prove. Unless, unless...... Khaldoon said: "When people say things, we know". Khaldoon has access to a very smart intelligence service. Do we know something?

Its completely reasonable for any of the clubs to pressure UEFA to act. Its a competitive game. If UEFA has overreached in an unsupportable or baseless case, then City will win at CAS. I don't think its as simple as that. But perhaps I am being naive.

 

[FrankSwift1]

Not just the G14. Many clubs will have stuck their oar in - this is a competitive, commercial industry. But that pressure does not equate to convincing the AC of UEFA to sanction City with the flimsiest of cases that they know will be appealed at CAS (and beyond if need be). That makes no sense. The AC must, in my view, believe they have at least an arguable case.

Thanks for your posts they're really useful for lots of blues in trying to understand whats been happening.

I couldn't see people risking their professional reputation to support 'an agenda' so my thoughts have always been as you say UEFA have an arguable case.

I know its difficult as a lot of the reasoning have not been released but at a best guess would you think the main arguments UEFA will put forward?