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

[CatMan]

I still feel that the club should have boycotted the Madrid game in protest (and in doing so, completely devalued the credibility of this year's competition.

Then, rather than appealing to CAS (which win or lose we'll still be viewed as arrogant bullies by the.media) we should attack the whole concept of FFP, via the European courts.

As it is, there's something about our smug attitude last summer that makes me worry.
We all applauded Khaldoon's end of season interview, but amidst all his smiling rehearsed answers I don't recall him predicting this outcome.

Completely agree about the boycott. We should have immediately withdrawn and started whatever legal proceedings were available. As I posted almost immediately, they've filed for divorce and are welcome to it!

Our continued presence in a competition that we've been informed we are not welcome to attend next season is both ludicrous and untenable. Continuing to persist with the illusion that it can all be made OK by CAS is a sycophantic delusion.

As the club hasn't had the moral fibre to pull us, then as fans we should carry out a 100% boycott. Any amount of whistles, tennis balls, banners and boos whilst we still attend will do nothing other that make us look like sulking children.

In short, it should have been an expulsion of all things UEFA and a message to never darken our doors again. This is about the integrity of Manchester City and kowtowing to UEFA in anyway severely damages that beyond repair.

 

[slbsn]

Think this might be an error, re Etihad and Sheikh Mansour Don't see any executive or board level or investment connection

Etihad is owned by the Abu Dhabi Government* can't see any executive or board level connection to Sheikh Mansour

*Etihad Aviation Group is the holding company since 2016

Etisalat is 40% public and 60% Emirates Investment Authority (EIA)

Sheikh Mansour is the chairman of EIA

The Emirates Investment Authority (EIA), an authority owned by the Federal Government, was established through Federal Decree Law No. 4 of 2007 as amended by Federal Decree Law No. 13 of 2009.
Its primary directive is to manage the sovereign wealth of the UAE by investing in a diversified portfolio of assets in key economic sectors and industries with the aim of delivering sustained financial gains for the UAE.

Mubadala Investment Company
100% owned by the UAE government founded in 2017
Sheikh Mansour is Vice Chairman
Khaldoon Khalifa Al Mubarak is Managing Director and Group Chief Executive Officer of the Mubadala Investment Company.

So in summary Sheikh chairs 2 investment companies Aabar , former Cty sponsor, and EIA and Vice Chair of Mubadala neither have any investments in Etihad Airways or Etihad Airways Group from what I can see

If its a mistake its UEFA's https://www.theguardian.com/footbal...accounting-sponsorships-uefa-champions-league "After further research Uefa was also advised that Etihad should be considered a related sponsor because of relationships of Mansour’s with members of the extended ruling family involved in the airline."

 

[bobbyowenquiff]

The CAS adjudicators are experienced professionals who have cultivated significant profiles as independent arbiters. They are capable of assessing everything in the round and making sound and sustainable judgements. In their determination, they have to address all matters raised and contested. Therefore if we can provide evidence proving that the funds came from the EC (the fulcrum of the matter), it will be impossible for CAS to argue otherwise in their determination. CAS cannot refute the irrefutable without bringing CAS as an institution into disrepute.

Assuming CAS takes our side, I think that the future for Der Spiegel is very bleak. It's one thing accepting stolen materials but an entirely separate thing to cherry-pick evidence to misrepresent the actions of the club. If we win at CAS, I expect that the club will bring an enormous defamation case against Der Spiegel.

The legal time limit in the Uk for libel is that you have to start action (even preliminary letters) within 12 months of first publication of the article (online or in print). So we are out of time with Der Spiegel. I don't know the rules in foreign courts though. CFG has been damaged everywhere. Could we sue them in the USA for example? However there would be nothing to stop us suing any UK broadcaster or publisher which has repeated any false allegations within a 12 month period of any CAS ruling. That would include organisations like the Daily Mail, Indpendendent website, Talksport, the BBC, and all the tabloids. All these groups have published or broadcast false stories about City's finances multiple times in recent months. In any civil action they would have to prove that what they had published was true (an impossiblity). They would also struggle with mitigation because to argue the "fair comment" defence you have to prove you published "in good faith" and so many articles have been totally biased and one-sided with not even a single balancing comment from City's side of the story.
David Conn for example is wide open for an action that could finish his career. The Guardian has probably been one of the worst culprits.

 

[Bazzmand Show]

From what I have seen in the media, most ex pro's actually seem to be on our side.

 

[slbsn]

Great post and it pretty well reflects my own thinking.

At the risk of getting boring and without knowledge of the details of what exactly we're charged with, my opinion is that we should agree with UEFA that solely for the purposes of FFP Etihad are a related party although we and our auditors don't accept they are under IAS 24.

In return they will agree that their sponsorship represents fair value for the period under review and that the source of funds is therefore irrelevant. They'd found that hard to disagree with, with Leterme having seemingly signed off Qatar's PSG sponsorship at €100m. QED on that score.

That might not be the only issue they're looking at of course but one thing I'd kind of forgotten is that I believe all this relates to stuff we did in the 2012/13 financial year, when we thought we had a chance of escaping punishment under the provisions of Annex XI S2. So we were stuffing the accounts as much as we could , which I explained to George Hannah a couple of days ago was a bit cheeky but probably not technically illegal.

Had UEFA been consistent on how clubs needed to do the relevant calculations then we probably wouldn't have thought about doing that. But they weren't and gave us every encouragement to carry on down the path we did, bringing forward partnership remittances and getting costs off the City books where possible. Had UEFA introduced its rules on controlled funding earlier, we wouldn't have needed to do that.

So while it sounds a bit dramatic, it's possible we could put forward some sort of "entrapment" argument, that UEFA deliberately led us on, knowing full well they were going to change the rules to those that could have given us a much better chance of achieving a controlled break-even position.

We are way beyond this stuff. We aren't going to overturn the idea that we breached pre-2014. Elaborate "entrapment" arguments will be hopeless. In any event, breaches pre May 2014 are definitively time barred by Article 37.

 

[Blue Maverick]

Great post and it pretty well reflects my own thinking.

At the risk of getting boring and without knowledge of the details of what exactly we're charged with, my opinion is that we should agree with UEFA that solely for the purposes of FFP Etihad are a related party although we and our auditors don't accept they are under IAS 24.

In return they will agree that their sponsorship represents fair value for the period under review and that the source of funds is therefore irrelevant. They'd found that hard to disagree with, with Leterme having seemingly signed off Qatar's PSG sponsorship at €100m. QED on that score.

That might not be the only issue they're looking at of course but one thing I'd kind of forgotten is that I believe all this relates to stuff we did in the 2012/13 financial year, when we thought we had a chance of escaping punishment under the provisions of Annex XI S2. So we were stuffing the accounts as much as we could , which I explained to George Hannah a couple of days ago was a bit cheeky but probably not technically illegal.

Had UEFA been consistent on how clubs needed to do the relevant calculations then we probably wouldn't have thought about doing that. But they weren't and gave us every encouragement to carry on down the path we did, bringing forward partnership remittances and getting costs off the City books where possible. Had UEFA introduced its rules on controlled funding earlier, we wouldn't have needed to do that.

So while it sounds a bit dramatic, it's possible we could put forward some sort of "entrapment" argument, that UEFA deliberately led us on, knowing full well they were going to change the rules to those that could have given us a much better chance of achieving a controlled break-even position.

PB can you tell me what the related party actually means and is it a good thing or bad thing?

 

[domalino]

From what I have seen in the media, most ex pro's actually seem to be on our side.

It's been quite funny seeing how many people are against FFP as a concept now.

 

[Cobwebcat]

I don’t think CAS’s decision will be conclusive.

They will almost certainly find that UEFA didn’t follow the correct process..they’ve already hinted at that.

But with such a complicated situation I think they will bounce it back to UEFA and say start it again and this time do it fairly.

UEFA will then offer City a way out. City might well reject it and we are back to CAS.

That’s my guess.

 

[Prater70]

Lose tonight we might not even qualify for Champions League. Happy to be banned from Europa.

 

[blueinsa]

Celtic

So equally accustomed to having it their own way.

 

[KS55]

Every fan of the other 87 league clubs outside of the G14 should be behind us. Whatever the outcome of this case, their chances of ever being able to compete at the top level will be blown wide open or locked away forever. This is about opening competition for all teams, not just between City and UEFA.

We lose this and those fans can scoff in the name of bantz for a few days and then realise that any remote chance of ever realising their football dreams will be gone forever.

They do have the possibility of the new owner rule, which gives them dispensation to exceed ffp limits for 3 or 4 years, provided they can convince UEFA that their business plan will bring them in line.
But, of course, only if they sell the club.

 

[Chippy_boy]

What I cannot get my head around is this concept of related parties, or not related parties, and how it applies to our sponsorship revenue.

When formulating the FFP rules and the calculation of the break-even requirement, UEFA decided not to use some arbitrary method of determining this, but instead to use rules and principles as defined in International Accounting Standards. The very same principles auditors use when determining whether income should be declared as being from related parties or not.

This was in theory a wise and sensible move. Not only are the rules well known and understood by all the audit firms, they contain rules and guidelines which apply objective, not subjective tests. For the very reason that we do not want to have a situation where companies accounts are open to interpretation, with one firm saying one thing and another firm concluding something different. If a party is deemed not to be related, then all of the income from that organisation is by its very definition "fair market value" since it was fairly obtained from the market! Of course the opposite is true: If revenue is coming from a related party, then there is a question about the basis upon which that revenue was secured and therefore a question about what the fair value would have been had it been obtained on the open market.

As I understand it, Etihad Aviation Group is owned by the Abu Dhabi government, not by ADUG and neither by any other organisation over which Sheikh Mansour has control. In any event the question as to whether Etihad is related or not, will have been the subject of our annual audit of our accounts. And our independent accountants have repeatedly signed off our accounts on the basis that Etihad is NOT a related party. To do so, knowing or suspecting this to be untrue, would be a criminal offence and surely something that any reputable accounting firm would never contemplate.

So how on earth is it that UEFA can unilaterally decide that Etihad *is* related? Sure it may smack of being a bit of a fiddle - since we can all imagine there may be possible influences which could be brought to bear amongst the upper eschelons of the Abu Dhabi powers that be. But that is really not the point, and is - from UEFA's perspective "tough shit". IAS24 - the standard which deals with related parties - has very specific objective tests, which we have passed. It is not within UEFA's remit to decide upon a different set of criteria. Their own rules say they will apply IAS24 standards, and those standards define Etihad as not being related.

And if Etihad is not related, then there can be no question of us having artificially inflated our revenues (from Etihad). They are what they are, as stated in our audited accounts.

What am I missing here? Apart from UEFA being a bunch of crooks who will make up the rules as they go along and as it suits them, of course.

 

[maurizio]

I don’t think CAS’s decision will be conclusive.

They will almost certainly find that UEFA didn’t follow the correct process..they’ve already hinted at that.

But with such a complicated situation I think they will bounce it back to UEFA and say start it again and this time do it fairly.

UEFA will then offer City a way out. City might well reject it and we are back to CAS.

That’s my guess.

Will it never f*cking end...

 

[SWPISHOME]

Lose tonight we might not even qualify for Champions League. Happy to be banned from Europa.

If we lose tonight we'd still be 11 points ahead of 5th place.

Not sure how your working that one out.

 

[remember arthur mann]

The legal time limit in the Uk for libel is that you have to start action (even preliminary letters) within 12 months of first publication of the article (online or in print). So we are out of time with Der Spiegel. I don't know the rules in foreign courts though. CFG has been damaged everywhere. Could we sue them in the USA for example? However there would be nothing to stop us suing any UK broadcaster or publisher which has repeated any false allegations within a 12 month period of any CAS ruling. That would include organisations like the Daily Mail, Indpendendent website, Talksport, the BBC, and all the tabloids. All these groups have published or broadcast false stories about City's finances multiple times in recent months. In any civil action they would have to prove that what they had published was true (an impossiblity). They would also struggle with mitigation because to argue the "fair comment" defence you have to prove you published "in good faith" and so many articles have been totally biased and one-sided with not even a single balancing comment from City's side of the story.
David Conn for example is wide open for an action that could finish his career. The Guardian has probably been one of the worst culprits.

One way of boosting our coffer's !

 

[BlueAnorak]

If its a mistake its UEFA's https://www.theguardian.com/footbal...accounting-sponsorships-uefa-champions-league "After further research Uefa was also advised that Etihad should be considered a related sponsor because of relationships of Mansour’s with members of the extended ruling family involved in the airline."

UEFA should have specified that in the FFP rules then, not just specified FFP as a word for word copy of IAS 24. By IAS 24 rules Etihad Airways are NOT a related party.
https://ifrscommunity.com/knowledge-base/ias-24-related-party-disclosures/
Retrospectively changing the law doesn't fly in international agreements.

 

[slbsn]

UEFA should have specified that in the FFP rules then, not just specified FFP as a word for word copy of IAS 24. By IAS 24 rules Etihad Airways are NOT a related party.
https://ifrscommunity.com/knowledge-base/ias-24-related-party-disclosures/

It's irrelevant because the parties disagreed and we entered a settlement. It's a moot point and exactly why they can't now come back on it (IMO)

 

[give it to gordon]

heres a thought, what if the G14 group now starting infighting because it might not have been all of them who put pressure on UEFA to come after us. Some of the G14 clubs have more to hide than others and are worried that we know this and will go to court and drag them into as well. It could get interesting. PSG how could their afford two £200 million players ? This will blow up big time !!

 

[bobbyowenquiff]

Quietly hoping they want to take it all the way, Colin, one question that keeps coming to me and I am sure at some point I have seen it mentioned in an official document of some sort is, if we take any on any 'legal' battle with UEFA does that mean we cannot participate in any of their comps at the time? I could be making that up but i'm bloody sure i've read it somewhere in the past.

Presumably they could just "withdraw our invitation" to compete in their tournament but this would hugely ramp up the scale of our damages claim so it would be a big legal risk for them. If it took five years our claim would be over a billion in lost revenues as a bare minimum. Would UEFA be that stupid? (Yes I know they might well be!)

 

[SilverFox2]

Completely agree about the boycott. We should have immediately withdrawn and started whatever legal proceedings were available. As I posted almost immediately, they've filed for divorce and are welcome to it!

Our continued presence in a competition that we've been informed we are not welcome to attend next season is both ludicrous and untenable. Continuing to persist with the illusion that it can all be made OK by CAS is a sycophantic delusion.

As the club hasn't had the moral fibre to pull us, then as fans we should carry out a 100% boycott. Any amount of whistles, tennis balls, banners and boos whilst we still attend will do nothing other that make us look like sulking children.

In short, it should have been an expulsion of all things UEFA and a message to never darken our doors again. This is about the integrity of Manchester City and kowtowing to UEFA in anyway severely damages that beyond repair.

Not saying you are wrong but by your own reasoning we were never welcome in the PL as the contrived FFP was used as an attempted "Barrier to Entry" so their current action is just an extension of that.