Let’s have a look at the books of the Citizens!


"If you lie to me, the day after I am not here"

Pep Guardiola's well-known statement has once again made the headlines as Manchester City FC faces potential charges from the English Premier League (EPL) for allegedly violating various financial rules over multiple seasons. The manager famously stated last year that if the club lied to him about their financial situation, he would leave and no longer “be their friend”. He expressed his trust in the club from day one, and has been defending them based on that belief. It is now the EPL that is accusing Manchester City FC of “lying to them”, which could turn out to be one of the most controversial stories in the history of the Premier League; whatever they decide, it could prove to be a fork in the road.

Manchester City under fire

In an official statement published on the Premier League’s website, the league has accused Manchester City FC of over one hundred breaches of Premier League rules between the 2009/10 and 2017/18 seasons. The accusation, which is the result of a four-year investigation, has led to the referral of the reigning English champions to an independent commission over the alleged rule-breaking.

The EPL has claimed that the club did not provide accurate financial information, particularly with regards to its commercial revenue, related parties, and operating costs. Additionally, the club is accused of failing to fully disclose managerial remuneration from the 2009/10 to the 2012/13 seasons, which were overseen by Roberto Mancini.

Manchester City FC are also facing accusations of violating the Premier League's rules on profit and sustainability in the seasons 2015/16, 2016/17, and 2017/18. The EPL further alleges that the club did not comply with UEFA's regulations regarding club licensing and financial fair play in 2013/14 and between 2014/15 and 2017/18.

The first allegations against City were published by Der Spiegel in November 2018, followed by investigations not only by the EPL, but also from UEFA. As the initial result of the latter, the club received a two-year ban from European competitions (for alleged breaches of UEFA’s FFP regulations) in February 2020. The sanction, however, was overturned by the Court of Arbitration for Sport (CAS) in the summer of the same year.

The journey to the top on the pitch…

Since the takeover of the club in the summer of 2008 by Sheikh Mansour and the Abu Dhabi United Group for GBP 210 million, Manchester City have gone through a remarkable journey with the ultimate goal of becoming the best club in the world and winning all major trophies. While the crown jewel is still missing after failing to win the UEFA Champions League during all these years, the club’s trophy cabinet has definitely started to fill up.

Since the 2010/11 season, the club had never finished a league season outside the top 4 places, winning the title six times during the process. In addition, they have managed to win the FA Cup two times and the EFL cup on five occasions, taking the total major trophy tally to 14 in just twelve seasons.

…and off of it.

The on-pitch success was enabled by significant investments by the new ownership, including upgrading the squad and investing in the club’s facilities (training centre and club headquarters). It was inherent from the first moment that for such a mammoth project to work, club finances need to follow.

Looking at the 2008/09 results, Manchester City FC recorded total operating revenues slightly above EUR 100 million, being the 19th best European club by this metric. Since then, the Club managed to grow their total revenue every single season except for 2019/20, because of the pandemic. They closed the gap to the already established elite clubs at domestic and international levels, before eventually overcoming them in the 2020/21 season, when they became the richest club based on total operating revenue – at least according to their books. The top position has been retained in the 2021/22 season, when they recorded total operating revenues of EUR 731 million (GBP 619 million), the highest figure ever registered by an English football club.

This is a total operating revenue growth by over 600% since the takeover (yearly average growth rate of above 16%). In comparison, among the English “Big Six”, in the same timeframe Tottenham Hotspur FC and Liverpool FC achieved the second and the third highest growth: recording revenue growth of 3.9 and 3.4 times, respectively.

Commercial revenue growth was the main driver behind the large revenue boost: from EUR 21 million in 2008/09 they grew to EUR 373 million (GBP 316 million) by the 2021/22 season. What was behind it? The rapid surge is certainly a result of the overall growth of the sports sponsorship market, supported by the digitalization process and the globalization of major football brands taking place in the last decade; increased sporting achievements, elevating the club and placing their global following firmly amongst the elite clubs, in turn attracting new and lucrative global sponsorship deals. It’s interesting to see how Manchester City were only the 20th club by commercial revenue in 2008/09, far behind the other “Big Six” and in particular from local rival, Manchester United FC. While, in the 2021/22 season, they recorded the third highest figure overall, behind only Paris Saint-Germain FC and FC Bayern München, but higher than their city rivals; they already surpassed Manchester United’s commercial revenue in the 2020/21 season.

In this 13-year timeframe, the Citizens’ commercial income grew to a figure that is more than 17 times higher than in the first season of the new ownership, which is significantly higher compared to clubs of similar profile. However, if we are only looking at the past eleven seasons, the magnitude of the growth was in line with other major clubs, 2.9 times the value in 2021/22 compared to 2011/12.

Manchester City’s long-running shirt sponsorship deal with Etihad Airways at a reported EUR 79 million (GBP 67.5 million) p/a (including the naming rights of the stadium) is currently one of the most lucrative of its kind in the football industry. While the deal in place with Puma as kit suppliers (EUR 76 million / GBP 65 million p/a) is the 5th highest overall in world football. The influence of the ownership’s network on the commercial revenue stream is shown by the weight of the sponsorship agreements currently in place with UAE based companies: six deals for a total reported value of over EUR 100 million (GBP 85 million), almost 27% of total commercial income.

Moving to the costs’ side, Manchester City’s evolution is also almost linear, as total staff costs kept growing, reaching the club’s record over the latest season: EUR 418 million (GBP 354 million). In the 2021/22 season, only Manchester United’s staff costs figure was higher among the English clubs at EUR 482 million (GBP 408 million). In the early years under new UAE ownership, the staff costs to revenue ratios were relatively high at 87% (2011/12) and 86% (2012/13), but the numbers became much more sustainable once revenues caught up to investments into the playing squad (a very healthy 57% in 2021/22, if revenues were correctly reported).

What could be the consequences of the accusations?

If found guilty, the club could face a range of punishments as outlined in rule W.51 of the Premier League's handbook, including a reprimand, fines, points deductions, and even expulsion from the league.

Any points deduction could be applied either at the time of the decision or retrospectively, with the possibility of City being stripped of previous titles. The panel, as per rule W.51.7, has the discretion to combine different punishments or impose other sanctions they deem appropriate. However, it is important to note that any punishment must be proportional to the breaches in question.

What impact will this have on the image of the EPL?

The reputation of the English Premier League as a major powerhouse in the football industry is well established. Known for its intense competition and high-quality play, the EPL draws huge audiences both domestically and internationally. With its high profile and global reach, the EPL has become a significant cultural phenomenon, often referred to as the “real Super League”.

However, recent allegations may raise questions about the league's image and integrity. If these allegations are substantiated, the impact could be significant. The league's reputation for fair play and financial transparency is a key component of its appeal, and any perceived breach of these values could harm its image and credibility.

In conclusion, the allegations against one of the EPL's flagship clubs have the potential to seriously impact not only the club, but also the league. Whether it turns out to be a minor violation or a significant breach of rules, the league's stakeholders will be closely monitoring the outcome of the investigation, and the impact it may have on the league's future. Other clubs’ owners will look on with interest and eventually with concern, if their financial position will be deeply scrutinized.