Appeal ruling could cost City De Bruyne, £200m and manager
Three potential scenarios await Guradiola’s side as they prepare to hear today whether two-year Uefa ban is upheld
City’s worst nightmare from the Court of Arbitration for Sport verdict could have severe repercussions from a financial, sporting and reputational standpoint.
The club earned £83 million in television and prize money from the Champions League last season, when they reached the quarterfinals, plus a further £10million in match-day income.
No Champions League football for two seasons could cost the club in excess of £200 million once Uefa’s €30 million (£27 million) fine for breaching financial fair play rules is factored in, and there may be the added threat of sponsors wanting money back if there are clawback clauses in their contracts.
The timing for City could not be worse coming on the back of the Covid-19 crisis, which has already severely hit match-day income with games played behind closed doors and rebates to broadcasters.
Pep Guardiola has planned a rebuild of his squad this summer after a meek surrender of the Premier League title to Liverpool, the £45 million sale of Leroy Sane to Bayern Munich and the impending departure of David Silva. But the City manager could find there is significantly less money to spend and even be forced to sell a star player.
Kevin De Bruyne said in May that he would consider his future if the ban was upheld, although reports in Belgium in recent days suggested he was happy at the club. Raheem Sterling may assess his options.
Such a scenario could also weaken City’s attempts to keep hold of Guardiola. He has vowed to see out the remaining year of his contract, regardless of whether there is no Champions League football next season. Yet he might be reluctant to extend beyond 2021 if asked to work under tighter financial constraints and with no European football.
The Premier League has also been investigating City’s finances and seems to have been waiting for Cas to return its verdict before announcing its position.
If Cas rejects City’s appeal and determines that they deceived Uefa, the club could be at risk of a points deduction from the Premier League, which could deal a fatal blow to hopes of wresting the title back from Liverpool.
If Cas sides with Uefa, City would be able to appeal only to the Swiss federal courts and generally only if a Cas arbitration panel made a clear error in law or the proceedings were deemed unfair.
Some of the same headaches will still apply whether a ban is one year or two but a shorter suspension by the three-person panel would be much easier to stomach financially
Pressure: Pep Guardiola’s loyalty to City will be tested if Cas backs Uefa’s two-year ban
given the wealth of City’s owners, and certainly improve the prospects of Guardiola signing a new contract.
City’s Abu Dhabi hierarchy could redirect funds generated from the sale of a £389million stake in their City Football Group empire to the US private equity giant, Silver Lake, last November to help cover any cash shortfalls brought about by an absence of Champions League football. They have already been doing that to help them through the coronavirus crisis.
Guardiola may find that, with a reduced budget, he will be unable to sign the three to five players he has been targeting and instead have to settle for a centre-half and left-back only. Whether City have a harder time trying to recruit with no Champions League football to offer remains to be seen. It was not an obstacle when they bought Silva and Yaya Toure in 2010 and City may argue to potential suitors that their prospects of winning back the Premier League title would be enhanced without the distraction.
A ban would increase the pressure on City to deliver Champions League success this season. City play Real Madrid in the second leg of their round-of-16 tie next month.
The obvious beneficiaries of City being denied entry to the Champions League next season would be their Premier League rivals. With City likely to finish second behind Liverpool, their Champions League spot would go to the fifth-placed team in the Premier League. That, in turn, would likely create an extra Europa League placing.
City have long insisted they have no case to answer. A successful appeal would be a bitter blow to City’s domestic and European rivals – on and off the pitch. Fifth place would not result in a Champions League spot this season and Guardiola, armed with the finances to oversee a full rebuild of his squad, may feel re-energised and more inclined to sign a new contract. Top players would see no need to leave and others might be eager to be part of a revamp.
Despite the hopes of Manchester United and Chelsea, an improved City would remain by far the biggest threat to Liverpool. Whether such news would assist City’s Champions League prospects is impossible to determine but it would be a significant boost and only improve squad morale. It could also severely reduce or even end the prospects of heavy sanctions from the Premier League.
The biggest losers would be Uefa. A City victory could deal lasting damage to the credibility of its FFP rules and undermine its standing.