5th June 2024Integrity of the Premier League

Financial Fair ‘Play’ Rules

It is the end of the 2023/24 Premier League Season and for the first time in the history of the league we have seen points deductions for two teams (in one season) Everton and Nottingham Forest for violating Financial Fair rules in the English Premier League. The convicted breaches occurred within the 2021/22 (Everton) and the 2022/23 (both clubs) seasons.

Middlesbrough previously had 3 points deducted in January 1997 for failing to fulfil a fixture and Portsmouth had 9 points deducted in March 2010 for entering into administration. Both clubs were handed immediate in-season point deductions.

The fast tracking of financial breaches was voted by the Premier League at its Annual General Meeting last summer, which may explain the recent disciplinary activity.

Since January 2024, we have seen many Premier League Managers and Directors of Football questioning the integrity of the Premier League as the two clubs above cases were dealt with in the 2023/24 football season and there is of course the on-going case against Manchester City ‘City’.

On 6 February 2023 (during the 2022/23 season), the Premier League confirmed that it referred to a number of breaches of the Premier League Rules by City.

Leicester City have recently been promoted back to the Premier League after a single season in the Championship. They were charged by the Premier League in March 2024 for an alleged breach of the League’s Profitability and Sustainability Rules (PSR) by failing to submit audited accounts to the Premier League Season for the 2022/23 season. An impending points deduction could be implemented in the upcoming 2024/25 season.

UEFA fined Chelsea £8.6 million due to Abramovich’s historical transactions in May 2023. When Chelsea ownership group completed its purchase of the club, the ownership group became aware of potentially incomplete financial reporting concerning historical transactions during the club’s previous ownership.

Chelsea self-reported these matters to UEFA and fully cooperated and assisted UEFA with it’s investigation of these matters and entered into a settlement agreement with UEFA.

Chelsea have yet to face any additional sporting sanctions by the European governing body or the Premier League although there is a high risk (based on City Charges) that the Premier League could be charging Chelsea for historical transactions.

Manchester City Charges

City have been charged with the following 115 breaches of Premier League regulations:

a. 54x Failure to provide accurate financial information from 2009/10 to 2017/18

b.14x Failure to provide accurate details for player and manager payments from 2009/10

c. 5x Failure to comply with UEFA’s rules including FFP from 2013/14 to 2017/18

d. 7x Breaching Premier League PSR rules from 2015/16 to 2017/18

e. 35x Failure to co-operate with Premier League investigations from December 2018 to Feb 2023

This is the first time that the Premier League have charged City however, they have previously been charged by UEFA for Financial Fair Play (FFP) breaches:

i) 2014 – Fined €60m (€40m of which was suspended) after failing UEFA FFP rules.

City agreed a settlement in order to avoid dispute in a timely manner. The concerns were over whether sponsorship agreements with ‘related parties’ had been inflated and therefore losses were lower in the period.

As part of the settlement, City committed to report a maximum deficit of €20m by the end of the 2013/14 season and €10m by the end of the 2014/15 season.

Sponsorship terms (from ‘related parties’) were not to be improved and a significant reduction in spending in the 2014/15 and 2015/16 season transfer windows were agreed.

City agreed not to increase wages for the 2015 and 2016 reporting periods (for the Champions League Squad).

Other points included sale of intellectual property to the City Financial Group and sale of image rights to Fordham Sports Image Rights Ltd. These are separate topics that won’t be commented on further (at this time).

2015 – UEFA lifted the imposing restrictions on 3 July 2015 as City had met their FFP target; spending on new signings in 2014 summer window was capped at £49m and the total wages for the season’s Champion League Squad would not exceed that of the 2013/14 season.

ii) 2018 – City were fined €30m by overstating sponsorship income and were thrown out of the Champions League with a two-year ban from European competitions.

The four main issues included the funding of the Etihad and Etisalat sponsorships, filing incorrect accounts and filing incorrect FFP information.

2020 – The charges were appealed to the Court Of Arbitration for Sport (CAS) where the court overturned the ban and the penalty was cut to €10m.

The CAS reached the conclusion (based on the evidence) they could not agree that disguised funding was paid to City. It was noted that charges relating to communications company Etisalat plus part charges for Etihad were disregarded because they were more than five years old and so were time-barred (covered later).

It should be noted that the Premier League concurrently opened an investigation into City’s affairs; the review was delayed ensuring City could comply with the UEFA investigation and City had raised concerns over procedural matters regarding the opening of the investigation.

The salient difference is timing as the Premier League are not barred as UEFA were by CAS. Furthermore, matters relating to the 2014 UEFA settlement were not reviewed by UEFA in 2019.

Accurate Financial Information

The concept of FFP was established by UEFA in 2009 and was implemented at the start of the 2011/12 season. The aforementioned breaches were for the 2011/12 and 2012/13 seasons.

The City case was novel due to the fact it was both a high profile club but also alleged to have falsified information.

City moved from a profit (before interest and taxation) in 2006 of £17m to a loss of £190m in 2011. The owners pumped over £1.2b into the club during that period.

2009/10 and 2010/11 Accounts

Arsene Wenger in July 2011 accused Man City of attempting to bend UEFA FFP rules via their new ‘reported’ £400m 10-year sponsorship deal with Etihad Airways.

‘If Financial fair play is to have a chance the sponsorship has to be at market value. It cannot be doubled, tripled or quadrupled’. 

By way of comparison, Arsenal in 2004 had a 15-year deal with Emirates valued at £90m.  Did Arsenal therefore complete a bad deal or a deal at “market value”? City’s accounts for 2010 and 2011 showed commercial income as £52.8m and £64.7m respectively. This was double Arsenal’s and quadruple Tottenham’s commercial income in the same years (but notably less than Manchester United and Liverpool).  Chelsea’s commercial income increased six-fold when the FFP rules came into play.

The question that therefore arises is: are the Premier League charges for these years suggesting that City’s commercial deals were not at “market value” for these years or was it something else?

2011/12 – 2013/14 Accounts

City accounts for the next three years show an increase of commercial income, as follows:

2012     £121m

2013     £143m

2014     £165m

These amounts have grown and were over 3 times Arsenal’s and 6 times higher than Tottenham’s commercial income. It was nearly double the level of commercial income that Liverpool received.

City have pointed out that they have found new ways to integrate the expertise of partners into day-to-day operations. Were City ahead of their time in maximising commercial revenues?

A major challenge the Premier League will face is corroborating that the sponsorship deals are excessive, as the matter is nuanced and subjective. They are collecting data of deals and using these as a means to assist with their assessments.

Reduce Maximum Deficit In 2013/14 and 2014/15

UEFA advised City not to reduce the maximum deficit for the 2014 and 2015 reporting periods.


  • Turnover increased by £75.5m (including increase of commercial income by £22m)
  • Operating expenses reduced by £3m (this included the £16m compromise agreement with UEFA and therefore would have reduced by £19m)
  • The bottom line loss was £23m (after player trading) which included the £16m compromise agreement with UEFA.


  • Turnover increased by £5m (commercial income)
  • Operating expenses reduced by £16m (no compromise agreement with UEFA)
  • City made a profit of £10.7 million

Premier League have charged City with the following:

* Failure to comply with UEFA for the years 2014 and 2015

* Failure to provide accurate financial information for the same years

We suspect that the Premier League are looking solely at the commercial income for these years as UEFA were happy with the information originally provided to them by City.

Related Party Transaction

Since the introduction of new rules in December 2021, it is now Manchester City (or all Premier League clubs in general) and not the Premier League which must demonstrate that a sponsorship deal represents ‘fair value’. Therefore, City has an obligation to flag a deal as a ‘related party transaction’.

Why the change and recent flurry of disciplinary action?  The Premier League have committed to maintaining the effectiveness of Profit and Sustainability Rules; they aim to reduce a club’s dependence upon commercial revenues and prevent unfair advantages to those clubs who are able to increase revenues and reduce costs by way of entities linked to a club’s ownership.

However, a club has a right to challenge a Premier League determination of Fair Market Value with external and independent assistance.

A related party transaction is one when a ‘close family member’ to club executives:

a) Has control or joint control of the club

b) Has significant influence over the club

c) Is a member of key management personnel

It is noted that two of City Commercial Sponsors are:

  • Aabar
  • Etisalat (an Emirati telecommunications company)


Sheikh Mansour (the owner of Man City) is the chairman of the investment funds which owns Aabar and Etisalat.

Aabar is an Abu Dhabi state-controlled investment fund. The deal was originally negotiated in 2010.

Similarly, Etisalat is an Abu Dhabi state controlled publicly listed company. The UEFA 2018 investigation concluded that £30M payments (2012 and 2013) were funded by the owners as disguised sponsorship revenue. Interestingly, CAS overturned the suspensions imposed by UEFA given the time barring and the fact the evidence given by UEFA was unsubstantiated however such restrictions (and further investigations) may not restrict the Premier League in their investigations (covered later).

Most are aware of City’s prominent sponsor- Etihad Airways.

Could it be argued that Etihad is a related sponsor because of the relationships Sheikh Mansour has with members of the extended ruling family involved in the Etihad airline?

Since 2010, it is noted that City’s commercial income (as reported in the accounts) is over £3b. Which element of this income comes from potential related transactions?

How does this stack with other commercial deals?  By way of comparison, Liverpool reported just over £2b whilst Manchester United showed £2.8b over the same period. Furthermore, the 2023 accounts show that City had sponsorship income of circa £417m with the next club being Liverpool at £272m.

Finally, it is understood that an unnamed club has threatened legal action against the Premier League on the impact of the associated party transaction rules and whether they are in breach of English competition laws. This is a further angle to consider in relation to this topic.

Timing of Payments

In one of the earlier UEFA cases it was reported that one of the sponsors (Etisalat) did not conclude a contract with City until 2014 (it was agreed in principle). Etisalat seemingly did not pay anything until 2015.

The sponsor payments appear to have been made via Sheikh Mansour’s company ADUG in 2012 and 2013 and was recorded in City’s financial statements (provided to the English FA) as commercial income.

The Premier League are likely to review this transaction in greater detail.

Fair Market Value

When Newcastle Utd was taken over in late 2021, the Premier League voted to stop them agreeing sponsorship deals with Saudi Arabia companies, due to links with the owners.

Newcastle’s commercial income in 2023 was £44m whilst Man City commercial income was a staggering £417m. This is £140m higher than Man United and £130m more than Liverpool.

It was agreed in December 2021 that the Saudi deals would go ahead as long as the Premier League considers them ‘fair market value’. As one can appreciate, this figure can’t be reached without an element of commercial subjectivity.

The Premier League board will take guidance from an independent external assessor on deals. In addition, they will have access to a confidential data bank (created and accessible by the Premier League) which will accumulate commercial deals across the league to assess their value.

Using Tottenham as an example

Tottenham’s commercial income in 2023 was £140m. Based on these rules what is there to stop Tottenham signing a stadium rights deal with say the Tavistock Group (Joe Lewis) worth £1 billion over 10 years. Should the fair market value comparisons be based on Man United and Liverpool deals or Man City?

What is Next

The above is just a very small sample of some of the matters arising on the accuracy of financial information.

The 115 charges are going be very detailed and there will be many technical arguments (especially if testing subjective market value).

It is no wonder it is going to take the Premier League over two years to hear and deliberate upon this.

Arsene Wenger questioned FFP in 2011 and nearly 14 years later we are likely to reach a decision on the biggest FFP case in the UK.

City have achieved considerable success but was it all within the ambit of the rules?  The Premier League will now need to carefully review the facts and reach a sensible conclusion.  As one can appreciate, the decision will likely have ramifications on how future commercial deals are valued and agreed.

Furthermore, in light of the recent disciplinary action taken by the Premier League, the integrity of the League has been questioned. It is worth making the point that the success of teams, both commercially and on the pitch plays a part in the Premier League’s appeal and ultimately revenue and so such questions on Integrity and Independence can be seen as valid discussion points.

For more information, you can get in touch with Martin here.


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