A decision due next month from the Court of Arbitration for Sport will affect not only the near-term future of Manchester City Football Club but also the role of big money in top-level professional soccer.
Since Sheikh Mansour of the Abu Dhabi ruling family bought English Premier League powerhouse Manchester City in 2008, City has skyrocketed to a value of $4.8 billion. Prior to the billionaire’s ownership, the Financial Fair Play system was developed and implemented by FIFA, the governing body for world soccer. The system was designed to “encourage good practice, allow unlimited spending on stadiums and facilities, academies, youth development, women’s football and community projects, and ‘benefactor funding’ on top, within limits.” The “break-even” requirement was the most controversial, allowing clubs to spend only a few tens of millions more per three-year cycle than they earned.
In February, Manchester City was fined and banned from competition in Europe’s Champions League for “serious breaches of Financial Fair Play regulations and UEFA Club Licensing rules,” and failure to cooperate with an investigation. If the sanctions are upheld, City will be banned from playing in the Champions League for the next two seasons, and will be fined €30 million ($33.7 million).
City has been a prominent part of the Champions League, home to football’s top talent. The top four finishers in the EPL qualify for the next season’s Champions League. City has qualified every year since 2011-12; this season, it is in the Champions League final eight, but competition is presently suspended due to COVID-19. With the two-year ban, City could see many of their top players look to leave the club and join elsewhere. In considering income like prize money, box office revenue and sponsorship deals, City could lose more than €150 million, or $168.4 million over the next two seasons. This drastic decrease in revenue may lead to City’s inability to cater to their current expensive roster.
City has contested UEFA’s decision and are awaiting a decision on their appeal to the Court of Arbitration for Sport (CAS), the self-proclaimed Supreme Court of sports. A Manchester City Official Statement on February 14, 2020, put it this way:
How will a verdict be reached?
The CAS appeal was essentially a new “trial” that concluded on Wednesday, June 10. City’s fate now relies on a three-man panel of judges. The panel includes one judge chosen by CAS, one chosen by UEFA and one chosen by City. Now that the hearing is concluded, the three judges will deliberate until they reach a decision, expected during the first half of July.
Leaked club documents published in German magazine Der Spiegel in November 2018 appeared to show evidence that City overstated its sponsorship revenue and break-even information from 2012 to 2016. This apparent deception included hiding the source of revenue tied to its owners in Abu Dhabi. The main allegation from these documents is that Abu Dhabi United Group, owned by Sheikh Mansour, had been funneling money to City sponsors based in Abu Dhabi. In turn, these sponsors rerouted that money to Manchester City as sponsorship. For example, the documents indicated that sponsor Etihad Airways was only paying €8 million toward a €67.5 million annual deal with City, while Mansour was fronting the remaining €59.5 million himself.
City has stated the evidence was stolen and reported out of context, but identified as authentic information. Does the use of hacked Manchester City emails that are at the forefront of the evidence against the club make City the victim of an unjust system? The answer in this proceeding is no—Just because evidence is obtained illegally does not mean the CAS will not accept it. CAS jurisprudence has consistently said that even if such evidence would not be admissible before a civil or criminal state court, it is not automatically thrown out here. It is well-established that arbitral tribunals have considerable discretion and the power to rule on the admissibility of evidence.
Sporting proceedings are far more flexible in terms of evidence than any other proceedings. A sporting federation or arbitral tribunal is able to take that evidence into account as previous cases demonstrate. For example, in the match-fixing case Ahongalu Fusimalohi v. FIFA, 2012, evidence consisting of recordings that FIFA obtained from the Sunday Times was argued by the applicant to be procedurally inadmissible. The applicant stated that because the journalists’ undercover investigation deceived him and used unnecessary and inappropriate methods, it is illegal to use.
However, the panel found that FIFA “transparently solicited and received such evidentiary material from the Sunday Times immediately after the publication… and the disclosure of important portions of the recordings’ content.” Consequently, there was no basis to exclude said evidence from the proceedings. In another match-fixing case, Amos Adamu v. FIFA, 2012, the CAS took the same approach. Similarly for Manchester City, although the Football Leaks website which provided the documents obtained by Der Spiegel were likely hacked, the information was readily available public knowledge immediately after posting.
The lawyers for Manchester City have consistently argued their innocence at the Court of Arbitration for Sport. Now that the hearing has concluded, the Panel will deliberate and start drafting the Arbitral Award, which will render its decision by the first half of July.
It is a well-known fact that many people dislike Manchester City because a billionaire foreign investor bought the club and started injecting billions of dollars into it in order to buy the top players. City will spend as much money as needed to field a winning squad. Although some will disagree, in short, their money has made them relevant. The CAS verdict will shine light on the future of City and the future of its money pumping owner, Sheikh Mansour. And, if the decision favors City, it may open the door to creative spending by other wealthy clubs in, or trying to reach, the top tier of world soccer.
Bajkowski, Simon, and Joe Bray. “Three Potential Outcomes to Man City CAS Appeal on UEFA Ban.” Manchester Evening News, 8 June 2020, www.manchestereveningnews.co.uk/sport/football/football-news/man-city-cas-uefa-verdict-18382249.
Bray, Joe. “Who Is Man City Owner Sheikh Mansour & What Is His Net Worth?” Manchester Evening News, 20 Apr. 2020, www.manchestereveningnews.co.uk/sport/football/football-news/sheikh-mansour-manchester-city-worth-15146697.
“A Look at the Legal Issues in Man City's Appeal against UEFA.” USA Today, 26 Feb. 2020, www.usatoday.com/story/sports/soccer/2020/02/26/a-look-at-the-legal-issues-in-man-citys-appeal-against-uefa/111371250/.
Marcotti, Gabriele. “Man City's Appeal of UEFA Ban: What's at Stake for City and Financial Fair Play.” ESPN, ESPN Internet Ventures, 5 June 2020, www.espn.com/soccer/blog-marcottis-musings/story/4106533/man-citys-appeal-of-uefa-ban-whats-at-stake-for-city
McMahon, Bobby. “UEFA Bans Manchester City For 2 Years: Separating Facts From Fiction.” Forbes, Forbes Magazine, 18 Feb. 2020, www.forbes.com/sites/bobbymcmahon/2020/02/16/uefa-ban-manchester-city-for-2-years-separating-the-facts-from-fiction/#6e0a8392204