Manchester City facing UEFA rap for FFP breach

MANCHESTER City FC is reportedly facing a near £50m fine from European football authority UEFA for falling foul of financial fair play rules.

As well as the £49m fine, squad and wage bill  restrictions will also be placed on the club – bankrolled since 2008 by Sheikh Mansour of Abu Dhabi – for next season’s Champions League competition.

Introduced by UEFA president Michel Platini, FFP – Financial Fair Play rules – are designed to ensure football clubs do not overspend and risk insolvency.

While the concept of financial sustainability is not in itself controversial, UEFA is not sanctioning clubs which carry significant levels of debt, but trading losses.

The Guardian, said City are strongly challenging the settlement offer from UEFA. The FFP rules prohibit clubs from losing more than £37m over two seasons, unless they can show that losses have been caused by investments in club infrastructure, including youth development facilities. 

Despite being in the throes of a £100m+ investment in the Etihad Campus – which includes a new football academy near the stadium, UEFA has still opted to hit City hard.

The fine won’t be an issue – it can be paid by the owners outside the club’s balance sheet – but squad and wage restrictions for the Champions League will be difficult to overcome.

The sanctions are said to be similar to those being handed to French club Paris Saint-Germain – which is backed by Qatari wealth.

Both City and PSG are believed to have fallen foul of the FFP rules with sponsorship deals related to each clubs’ owners. The club has a £40m-a-year deal with Abu Dhabi-based Etihad Airways, while the Parisian club have a more meaty deal with the Qatar Tourist Authority worth up to €200m (£165m) a year.

After investing heavily in players after the acquisition, City have taken boosted revenues, and to some degree reined-in player spending, to bring losses down from £195m in FY 2011 to £45m last year.

Manchester City declined to comment.