Manchester City‘s appeal against the Premier League guilty verdict on serious financial breaches could fall flat due to their previous statements about their claim.
The biggest scandal in English sporting history has unfolded during the international break after a decision finally landed on City’s 115 charges. An independent commission found the club guilty on 114 of those charges and most of them were of a serious nature.
City have maintained their innocence throughout and submitted an appeal before the deadline of Friday (October 2nd). As their CEO, Ferran Soriano, claimed in a video sent to club employees after the verdict, they are adamant that the Premier League’s allegations are based on a “single false accusation.”
Man City Appeal Contradicts Two Previous Claims
Action Images via Reuters/Jason Cairnduff
City are appealing against the guilty verdict by claiming that commercial contracts were not paid for by the club’s owners as the independent commission found. Instead, they insist that the payment had been made by the Abu Dhabi government, which they argue is an arrangement within Premier League rules.
The Telegraph have pointed out that this argument is a complete contradiction to the club’s title sponsor Etihad Airways’ comments to the US government.
The United States’ Department of Commerce, Transportation and State conducted an investigation into state-owned airlines. Etihad Airways denied the asertion that the Abu Dhabi government paid for Etihad’s sponsorship of City:
The assertion that the Abu Dhabi government paid for Etihad’s sponsorship of English Premier League football club Manchester City is false. In 2011, Etihad and Manchester City entered into a 10-year sponsorship agreement, which included naming rights for Manchester City’s stadium. Etihad funded this sponsorship from its own liquidity.
The airline also added: “We are government-owned and have been since our founding. We are and have always been clear that we do not receive any subsidies from the Abu Dhabi government, and that we are financed through a combination of equity, shareholder and commercial loans. Our shareholder [The Abu Dhabi government]’s equity and loans are not subsidies under any applicable definition; they are the means by which the Abu Dhabi government has sensibly invested in a successful business model.”
City also previously argued in contrast to the claim they are making with their appeal, when back in 2020 they managed to overturn a ban from European football. UEFA had punished them for financial breaches, but this was overturned after the club took the case to the Court of Arbitration for Sport (CAS).
The club maintained that “all sponsorship liabilities were met by the sponsors in question.” Switching back to the ongoing case, their position is that they have “a body of irrefutable evidence” that will prove the commission’s findings to be untrue.
Man City’s Change in Position Over Government Funding
REUTERS/Molly Darlington
If the evidence is as reported that commercial contracts were paid for by the Abu Dhabi government, this is in complete contrast with the claims made on two separate occasions. In July 2020, they stated in their UEFA case in the Court of Arbitration that their sponsorship was NOT government-funded.
Former Etihad chief executive James Hogan said in his witness statement:
Neither [HHSM – His Highness Sheikh Mansour], nor his private investment vehicle ADUG (Abu Dhabi United Group), nor any entity on their behalf, has funded or reimbursed the sponsorship obligations of Etihad under the sponsorship agreements. The sponsorship obligations were paid out of Etihad’s own funds as described […] above. I was PCEO throughout the relevant period and I would have known if any arrangement had existed for the funding or reimbursement of the sponsorship fees paid by Etihad to MCFC, as alleged by UEFA, which I did not.
Simon Pearce, member of the board at City and a key official in the Abu Dhabi Group, also stated that “there is no ways [sic] monies could have been injected into the company without the knowledge of the financial or internal audit group of Etihad”.
Fast-forward six years and the club are now stressing that their sponsorship IS government-funded and this claim was made in the 40-page verdict released by the independent commission. In it the club denied that there had ever been any Disguised Funding Scheme of the type alleged by the PL”.
City allege that the Premier League have “misunderstood how AD Sponsorship Agreements had been funded by AD Sponsors. Their defence read:
That AD Sponsors had always been liable for all Recorded Sponsorship Fees, and all Recorded Sponsorship Fees had in fact been paid to the Club by AD Sponsors from their own funds/resources. No part of any Recorded Sponsorship Fee had been paid by ADUG or from or using ADUG funds.
AD Sponsors had from time to time applied for financial assistance from the AD Government towards their liability to pay the Recorded Sponsorship Fees. Such applications had been granted, and financial assistance had been provided to the AD Sponsors by the AD Government via the CPC. In each case the level of financial assistance provided by the AD Government to the relevant Sponsor had been in the amount that the PL wrongly contended represented a Tagged Sum from ADUG.
City’s appeal will be put to a new three-person independent commission group whom can only review the decision and not hold a full rehearsing of the case. In the background, controversy is taking hold amid UAE officials warning of a severe punishment potentially undermining their appetite for future grand-scale commitments in Britain, per Bloomberg.
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The Premier League are set to punish City and are likely to do so even while the appeal is still ongoing. A severe fine, points deduction, relegation or even expulsion are all possibilities.