Manchester City has been found guilty of using commercial agreements that the Premier League says were designed to disguise more than £830 million in funding, in a major finding covering almost a decade of the club’s financial affairs.
An independent commission ruled that City breached Premier League financial rules between the 2009-10 and 2017-18 seasons after using what it described as “sham contracts” with several commercial partners.
The commission found the club guilty of all the charges brought against it except one concerning its failure to cooperate with the Premier League’s investigation.
The findings were detailed in a redacted report published by the Premier League on Tuesday, days after the League confirmed that City had been found guilty of most of the 115 financial breaches it faced.
The commission said the case involved well over 100 alleged individual breaches, which were grouped into four main categories.
According to the report, some of the commercial arrangements used by City did not represent their true economic value. The commission said the club also relied on agreements that helped increase its reported revenue while lowering its costs.
The arrangements were described as part of a “disguised funding scheme” valued at £830.69 million.
“The relevant sponsorship agreements were found to be shams, or at minimum did not reflect their economic substance,” the commission said.
The report further accused the club of “deliberate or reckless conduct intended to circumvent the Premier League rules”.
It said the arrangements helped City avoid recording what would have been the biggest single-season loss in Premier League history during the 2009-10 season.
The Premier League said the commission’s findings established the facts surrounding the club’s conduct during the period under review.
League chief executive Richard Masters said the findings supported the decision to pursue the case against City despite the lengthy process.
“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.
“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.
“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.”
The League said the punishment for the breaches will not be decided as part of the current proceedings. Instead, Manchester City’s sanction will be considered at a separate hearing before the independent commission.
The rules require the hearing to remain private and confidential. City has until Friday, October 2, to lodge an appeal against the commission’s findings.
Culture, Media & Sport secretary Lisa Nandy said the report had raised concern among supporters of the club and the wider Premier League.
“It's incredibly serious, the Premier League report is incredibly stark.
“This is causing a lot of concern for Man City fans and all fans of Premier League football.”
City rejects commission's findings
Manchester City has strongly rejected the conclusions and continues to deny any wrongdoing.
In its response, the club said it was surprised and disappointed by the commission’s decision and maintained that it has substantial evidence supporting its position.
“Manchester City FC is both disappointed and surprised by the opinion of the Premier League Commission, that has been published today.
“The Club is innocent of the accusations made by the Premier League and a comprehensive body of irrefutable evidence exists in support of all of its positions, relating to this case. The Club will therefore be relentless, and where necessary proactive, in any and all appropriate regulatory and legal forums.
“The Premier League process remains ongoing, with significant elements uncompleted. Manchester City FC will now pursue the appeal avenues open to it, on the basis that the opinion contains clear material errors, of law, principle and fact, and is unsafe.
“The Club has diligently respected due process for eight years on the basis that the Premier League Board and Executive would behave as an independent, impartial and fair-minded regulator, free from partisan influence.
“The Club is obviously restricted in what it can say further until all future proceedings are complete.”
City said it would use the appeal avenues available to it and argued that the commission’s opinion contained errors relating to law, principle and fact.
The club also said it could not comment further while the remaining proceedings were still underway.
The commission’s findings leave the case at a further stage, with the separate hearing on sanctions and City’s appeal still pending.