Manchester City found guilty of financial rule breaches by an independent commission

Manchester City have been found guilty of serious breaches of the Premier League’s financial rules over a nine-season period, following the conclusion of the long-running investigation into the club.

An independent commission also found the club guilty of the majority of charges relating to its alleged failure to cooperate with the Premier League’s investigation.

According to the Commission’s findings, the breaches relating to financial reporting occurred between the 2009/10 and 2017/18 seasons, while the non-cooperation charges covered the period of the Premier League’s investigation.

The Commission found that Manchester City used a number of commercial arrangements that it described as “sham” contracts, which did not accurately reflect the agreements between the parties.

It concluded that these arrangements were used to artificially increase the club’s reported revenue and reduce its reported costs.

The Commission also found that City submitted accounts that did not accurately reflect the club’s financial position and concealed the true state of its finances from its auditors and football regulators.

The independent commission found that Manchester City was significantly in breach of both the Premier League’s spending regulations and UEFA’s financial rules during the period under investigation.

The findings centered on a series of commercial agreements involving the club’s sponsors and Abu Dhabi United Group Investment & Development Ltd (ADUG), the company that owned Manchester City.

According to the Commission, some sponsors paid only part of the relevant sponsorship fees, with the remaining amounts funded by ADUG.

The Commission also found that additional arrangements funded by ADUG allowed Manchester City to record lower operating expenses than it had actually incurred.

A separate arrangement involving Fordham, an entity that purchased the image rights of Manchester City players, was also found to have been funded by ADUG.

The Commission concluded that these arrangements artificially increased the club’s reported revenues and reduced its reported costs by more than £900 million during the period in question.

As a result, the Commission found that Manchester City’s accounts did not accurately represent its income and expenditure for the purposes of the Premier League’s Profitability and Sustainability Rules and UEFA’s Club Licensing and Financial Fair Play regulations.

It further concluded that, had the agreements been accurately reflected in the club’s accounts, Manchester City would have breached both the Premier League’s and UEFA’s spending limits by a substantial amount.

The Commission also found that Manchester City breached its obligations to cooperate with the Premier League during the league’s four-year investigation.

Three of the four alleged breaches relating to cooperation were upheld.

The Commission concluded that the club had made concerted efforts to prevent or frustrate the Premier League’s investigation.

The Premier League originally referred the alleged financial and cooperation breaches involving Manchester City to an independent commission in February 2023. (Premier League)

Premier League chief executive Richard Masters said the decision establishes the facts surrounding Manchester City’s conduct during the period under investigation.

“The core decision establishes the facts of what happened at Manchester City during this period. It details how the club systematically broke Premier League rules for nearly a decade.”

Masters said the ruling also justified the Premier League’s decision to pursue the case despite the lengthy process.

“It also vindicates the Premier League’s decision to pursue this case against Manchester City. While the process to date has been both long and difficult, the League has remained determined that the facts be established independently.”

He added that enforcing the Premier League’s rules was essential to maintaining the integrity and competitive nature of the competition.

“It is a key responsibility of the Premier League to ensure that the rules, approved by the clubs themselves, are upheld to protect the integrity of the competition. It is paramount that the League remains competitive and fair for all clubs and for the fans. We take that role extremely seriously.”

Masters described the case and the Commission’s decision as highly significant in Premier League history, while stressing that the sanctioning stage has yet to be completed.

“This disciplinary case, and this decision, are the most significant in Premier League history. There are elements of the case that remain to be decided, including, importantly, what sanction must follow for these breaches.”

No sanction has been imposed at this stage.

The punishment for the breaches will be considered separately at a further hearing before the independent commission. Under the Premier League’s rules, that hearing will be conducted privately and confidentially until the outcome can be published.

Manchester City also has the right to appeal the Commission’s findings and has until Friday, October 2, to exercise that right.

The Premier League said its intention is for the remaining process, including any appeals and publication of relevant decisions, to be completed as soon as possible.

A redacted version of the Commission’s Core Decision has been published, while additional appendices are expected to be released when the League is able to do so.

The ruling therefore establishes the Commission’s findings on the charges, but the final sporting or financial consequences for Manchester City remain to be determined.

Commission following the Premier League’s long-running investigation.