Beyond the pitch: Manchester City's case, sanctions and the wider fallout

The preamble to the Commission’s Decision goes some way to explaining the length of time that elapsed between the hearing (which concluded in December 2024) and the publication of the outcome, with more than a hint of dry humour in the reference to the 750-page hearing bundle index. Nonetheless, the Core Decision itself, a redacted copy of which has been released by the Premier League, is careful, concise and remarkably brief, with much of the Commission’s reasoning seemingly contained within a multiplicity of appendices.

The core finding is that City engaged in a ‘Disguised Funding Scheme’ involving sham commercial transactions, the purpose of which was to disguise funding provided by its ownership as sponsorship income or other commercial revenue.

In total, the Commission found that of £949.94 million of ‘commercial income’ in the 2009/10 to 2017/18 seasons, £830.69 million was in fact payable (and paid) by the Club’s owners and should thus have been recorded as equity contributions. Only a fraction - £119.25 million - represented sponsorship fees for which the Club’s Abu Dhabi sponsors were liable and in fact paid – i.e., the ‘true’ commercial revenue.

City’s case was that the Premier League had misunderstood the arrangement, contending that the sums characterised as equity contributions were in fact attributable to government assistance applied for by and granted to the Abu Dhabi sponsors. The Commission rejected this explanation as having been “concocted well after the event in an attempt to obscure and conceal the realities of the Disguised Funding Scheme.”

The Commission also found that the Club had entered into a closed-circle arrangement (known as the ‘Fordham Arrangement’) involving the licensing of players’ image rights, which functioned essentially as a further vehicle by which the Club’s ownership could inject funds into the Club in a manner that could be disguised as operating income. It also served as one of a number of ways in which the owner’s funds were used to meet what were in reality Club liabilities in such a way as to artificially reduce the Club’s operating expenses (another of which was the use of consultancy arrangements).

The result was that City’s financial statements, which dramatically overstated the Club’s income and understated its expenses, were not accurate and did not reflect the true financial position of the Club.

Quite apart from the substance of the findings themselves, the judgment is striking for the picture that it paints of City’s response to its finances being put under the spotlight. The Club is said to have made ‘concerted efforts to stop and frustrate the PL investigation’, and a number of the Club’s factual witnesses were found by the Commission to have been dishonest in the evidence that they gave at the hearing.

The findings of the Commission beg the obvious question – what punishment fits the crime? In procedural terms, the issue of sanction will be determined following a further hearing, with the Commission having the power to (inter alia) impose a fine, issue a points deduction, or expel the Club from the Premier League.

The Premier League Rules take effect as a contract binding the clubs, the League itself, and the FA, governed by English law and subject to the exclusive jurisdiction of the English courts (subject to the dispute resolution provisions contained within the Rules). For this reason, there will be no repeat of Man City’s 2020 heroics before the Court of Arbitration for Sport (Cas), the body which overturned City’s two-year ban from participation in European club competitions.

However, City has now appealed the Commission's findings. Rule W.77 of the Premier League Rules provides a right of appeal to a three-person Appeal Board, provided that any such appeal is filed within 14 days (Rule W.81). The deadline for City to lodge an appeal was 2 October 2026 and, having exercised that right, the Club's challenge will now proceed before the Appeal Board.

City’s statement following the publication of the redacted Core Decision was characteristically forceful, stating that the Club is ‘innocent’ of the charges and will ‘be relentless, and where necessary proactive, in any and all appropriate regulatory and legal forums.’ It further noted that the Club would ‘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.’

City’s somewhat vague reference in its statement to ‘significant elements’ of the Premier League process remaining ‘uncompleted’, coupled with their allusion to material errors ‘of law’, might suggest that they are envisaging a further arbitral process on one or more of the narrow review grounds set out in Rule X.4 (for example, that the decision was one which could not reasonably have been reached by any Commission or Appeal Board which had applied its mind properly to the facts – Rule X.4.5). Any further appeal would lie only to the High Court on the usual (and narrow) Arbitration Act 1996 grounds, namely those of lack of jurisdiction or a serious irregularity causing substantial injustice (appeal on a point of law being excluded by the Rules).

And what of Man City’s league rivals? It appears increasingly likely that the conclusive outcome, once reached, may generate yet more litigation, this time from rival clubs alleging that they have lost out financially as a result of Man City’s rule breaches. In this regard, all eyes will be on the outcome of Everton’s appeal against the decision that they must compensate Burnley in respect of the former’s breaches of the Premier League’s Profitability and Sustainability Rules.

Such claims, while largely unsatisfying from a fan’s perspective – seeing your club compensated for losses arising from a rival’s ill-gained victory is not the same as watching your club win a major trophy, or qualify for the Champions League – would, from City’s perspective, compound the financial impact of the Commission’s verdict. More broadly, one might expect there to be something of a deterrent effect on future would-be rule-breakers.

Back on the pitch, there is the question of how the uncertainty surrounding Manchester City will affect the players and the manager, and whether rival teams will be able to use the moment to their advantage – starting with Iraola’s Liverpool on 11 October.