Manchester City has been banned from the Champions League, Europe’s most prestigious club football competition, for the next two seasons, in a crushing blow to the ambitions of the Premier League champions.
Uefa, European football’s governing body, announced on Friday that the club had been found to have committed “serious breaches” of its so-called financial fair play regulations designed to prevent overspending on players in the pursuit of success.
A Uefa adjudicatory panel decided that the club should be banned from the Champions League, the continent’s top competition where more than €2bn is distributed among participating clubs, for the next two seasons and pay a fine of €30m.
Manchester City said it was “disappointed but not surprised” by Uefa’s decision and said it would appeal against the ruling to the Court of Arbitration for Sport, a body considered the ultimate arbiter of global sports disputes.
The appeal means there remains a possibility that the club could escape a ban.
Uefa investigators began a probe last year following the publication of leaked documents that suggested that the club had artificially inflated the value of sponsorship deals with undeclared additional funding from its Abu Dhabi-based owner, among a number of measures allegedly used to deceive the sport’s investigators.
The billionaire Sheikh Mansour bin Zayed al-Nahyan, a member of the Abu Dhabi royal family, bought Manchester City in 2008 and has spent hundreds of millions of pounds on players to build a team capable of challenging for the sport’s top prizes.
A lengthy Champions League ban would probably dent the ambitions of its star players, many of whom would be attractive to other leading clubs around Europe.
Uefa’s club financial control body, a division that polices FFP regulations, said that “having considered all the evidence” Manchester City had overstated the sponsorship revenue in its accounts between 2012 and 2016, and also failed to co-operate in its investigation into the case.
In 2014, Manchester City and Uefa reached a settlement over past alleged FFP breaches, with the club agreeing to pay a £49m fine and to restrictions on incoming transfers to its first-team squad in European competition.
A ban from the lucrative Champions League would severely hit Manchester City’s finances, although the club’s owner received new funding in November after agreeing to sell a $500m stake to US Private equity group Silver Lake. The deal broke a record in sports valuations.
Silver Lake bought more than 10 per cent of City Football Group, Manchester City’s parent company and owner of clubs around the world, at a valuation of $4.8bn.
For the past three seasons, the team has been led by Pep Guardiola, one of football’s most admired and successful coaches, who was enticed to the club with the aim of winning the Champions League.
The team is currently trailing far behind Premier League leaders Liverpool, putting it on course to lose its crown as English champions.
Club insiders insist that Mr Guardiola is committed to the organisation until the end of his current contract in 2021, despite rumours that he could leave at the end of the season.