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City and PSG Expect To Face FFP Sanctions

Tue 29th Apr 2014 | Money & Finance

Manchester City may face sanctions from UEFA over breaches of Financial Fair Play (FFP) rules.

City, along with French champions Paris Saint-Germain, are among up to 20 clubs thought to have failed to meet the European governing body’s strict new financial regulations.    

It’s understood that UEFA has made settlement offers to all the clubs deemed to have breached rules ahead of a meeting on Thursday.

It is expected however, that City will not be excluded from competing in the Champions League but the details of any sanctions are unknown at present.

Manchester City's financial results for the season 2012/13 showed the club made a net loss of £51.6m, down almost half from the previous season’s £97.9m, along with record revenues of £271m. Despite the reduction in losses, they still sit outside UEFA’s tolerable limits.

Commenting on the news Faye Bargery, Senior Associate at Thomas Eggar LLP, said, “All eyes will be on what action UEFA takes and whether the sanctions will have a material impact on those clubs breaching the rules.

“It is likely that the credibility of UEFA and the FFP rules will judged by the outcome of these first cases and so the next few weeks will be an important period for both UEFA and the clubs involved.

“Under the FFP rules all clubs will have the opportunity of accepting a settlement offer from UEFA. The clubs can choose to reject that offer and try to negotiate a lesser sanction or appeal the decision in its entirety.

“PSG have already indicated they will appeal any decision that they have breached the rules, which could call into question the validity of the FFP rules and how they are applied.”

UEFA have said they are ready for any legal challenge to the sanctions imposed. “We are not afraid of anything being contested,” said UEFA’s Head of Legal Affairs, Alister Bell in the latest issue of fcbusiness magazine.

“We fully anticipate there will be challenges, in fact it would be strange if there weren’t.”

Daniel Geey, solicitor and sports lawyer with Field Fisher Waterhouse cautioned, “It's important to note that there has been no official confirmation from UEFA as to who has fallen foul of the FFP break-even regulations.

“Once UEFA announce who has breached the provisions it is also likely that they will explain who has agreed to settlement procedures with UEFAs CFCB.

“Such settlement may include fines and also sporting sanctions like reductions in squad sizes and points deductions. The ultimate sanction, which though is unlikely to be included in any settlement agreement, is obviously expulsion which could occur in the case of heavy losses incurred by a club.”

Image: Action Images / Carl Recine

Posted by: Aaron Gourley 

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