Manchester City and the Premier League held early discussions about a possible settlement in the club's financial case, but the talks quickly broke down, according to people familiar with the matter. The discussions could have limited the scale of sanctions facing the Abu Dhabi-backed club, the people said.
The previously unreported talks took place before a Premier League-appointed commission reached its verdict late last month. The people requested anonymity because the information was private.
Any agreement under discussion would have centred on a substantial financial payment rather than measures such as relegation or the removal of titles, according to the people. Manchester City maintained its innocence throughout the discussions, they said.
Late last month, the commission found that City had artificially increased its reported financial results by more than £900 million (S$1.52 billion). The ruling said revenue had been padded through “sham” commercial arrangements involving money from Abu Dhabi, in order to circumvent financial fair-play rules.
The club faces more than 115 financial charges in the Premier League case. Given that scale, the people said a settlement would probably have reduced the scope of the proceedings rather than brought the entire case to an end.
Potential sanctions include a points deduction, substantial fines and expulsion from the Premier League. Manchester City is appealing the commission's verdict.
Manchester City and Premier League representatives declined to comment. Under Premier League rules, the appeal decision should be published by early February after a new three-person appeal board has been appointed.
In an earlier statement, Manchester City said: “The Club’s firm position is that, on multiple grounds, the opinion contains clear material errors, of law, principle and fact and is unsafe.”
The club added: “The Club is innocent of the accusations made by the Premier League and a comprehensive body of irrefutable evidence exists in support of all of its positions, relating to this case.”
Possible reaction from rivals
Settlements are common in major financial disputes. Deals between banks and regulators after the financial crisis, for example, often involved fines worth billions of dollars without including admissions or denials of wrongdoing.
However, a potential settlement involving Manchester City would likely have faced strong opposition from rival clubs, including Arsenal and Liverpool FC, which lost Premier League titles during City's run of success, the people said.
Political and investment implications
The dispute has also drawn attention beyond football. Comments by Prime Minister Andy Burnham thanking Manchester City's owners for their investment prompted criticism from politicians in his own party, who want the process to remain independent of government influence.
The United Arab Emirates has invested more than £30 billion in major British sectors including defence, life sciences and technology. Emirati officials have warned the British government that the severity of the ruling could affect their willingness to make future large-scale commitments in Britain, according to the report.
Source: The Straits Times, reporting Bloomberg
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