When a cataclysm happens in a courtroom, it can be hard to fully and immediately appreciate the impact of it. But the overturning of Manchester City’s two-season UEFA Champions League ban for violations of Financial Fair Play regulations by the Court of Arbitration in Sport on Monday is very much that, a cataclysm.
Because in one fell swoop, CAS has relegated the most stringent financial limitations the European governing body could conjure to a glorified kangaroo court, incapable of levying anything more than a stiff fine on the uber-rich. City’s 30 million euro fine was reduced to 10 million euros, a veritable rounding error for its bottomless-pocketed ownership.
After all, if not even City could be convicted for what UEFA believed to be a straightforward case, with the verdict actually sticking upon appeal to CAS (a kind of supreme court for sports-related cases), the whole thing is beyond saving. There isn’t a club in the world that has benefited from outside investment as much as City has. After all, Chelsea and Paris Saint-Germain were already domestic powers in their respective leagues before their moneyed takeovers. City, meanwhile was converted from a club bouncing between the Premier League and the second-tier Championship into a global power as a branding play for the government of Abu Dhabi.
Manchester City was exactly the sort of club the FFP rules were written for, on the shaky premise that outside investment destabilizes soccer and that teams should be compelled to live within the means they generate themselves — never mind that curbing financial injections also unfairly ossifies the status quo. And if City cannot be held to account for allegedly misrepresenting direct investment through another Abu Dhabi-owned company, Etihad Airways, as sponsorship income, the entire exercise is pointless.
CAS found that UEFA’s Club Financial Control Bodies findings on City’s allegedly misrepresented income were either “not established” or “time-barred” — meaning the evidence was either insufficient or that the five-year statute of limitations had already elapsed when charges were brought. The court did agree with the CFCB’s adjudicatory chamber that City had obstructed the investigation, which is why it preserved some of the fine. But the central component to the punishment, the draconian two-year ostracizing from European competition, was overturned entirely because the central premise of the charges was overturned.
The verdict may, without intending to do so, have positive implications for a sport ravaged by the COVID-19 pandemic. The coronavirus cost clubs and leagues hundreds of millions in missed income, if not billions. The FFP regulations are already being loosened for a year to help soccer recover. But now that FFP has been undermined long-term, that could speed up the restoration of some clubs to their pre-pandemic financial outlook and allow for new powers to rise.
But whatever the case, it is now evident that UEFA’s sway over its biggest and richest clubs is severely diminished. Manchester City’s FFP fight, along with similar cases brought against Qatari-backed Paris Saint-Germain, served as a proxy for a power struggle between the governing body and its most marketable teams. If UEFA’s grasp was tenuous before, it may now have lost control altogether. It’s starting to feel like the big clubs play in UEFA’s signature competitions at their own pleasure, rather than UEFA’s.
If UEFA cannot enforce its own rules in cases where it believes it has overwhelming evidence, with an independent adjudicator overturning punishments, the power UEFA holds is illusory. In a practical sense, UEFA is an organizer of tournaments now, a kind of event-management company that gets a generous cut of the proceeds from the revenue driven by others.
Soccer’s biggest clubs have long suspected that if they really wanted to, they could simply band together and break away to form their own European circuit — much like Premier League clubs did back in the early 1990s, unshackling themselves from a Football League they deemed too constricting. That Europe’s juggernauts have never bothered to is partly because the whole process would be expensive and unwieldy and because UEFA has shown a willingness to compromise.
Now that City has exposed Financial Fair Play to be essentially toothless, clubs will feel empowered to disregard it altogether. How UEFA reacts will dictate how relevant it remains going forward.
And in the meantime, City has saved its own project of conquering Europe. If it had been barred from continental competition for a season or two, it’s likely that a slew of stars would have left, others would have become reluctant to replace them and superstar manager Pep Guardiola would have been hard to retain. With four Premier League titles in this decade, the Champions League is the final frontier for City. And now that it can keep trying in the coming seasons, its momentum will not be thwarted.
Meanwhile, UEFA’s attempt to regulate the finances of European clubs, admirable in its ideation but clumsy in its application, now seems to be dead in the water.
Leander Schaerlaeckens is a Yahoo Sports soccer columnist and a sports communication lecturer at Marist College. Follow him on Twitter @LeanderAlphabet.
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