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Digging Deeper into the Charges Against City

By: Ted Fred Franky, Refuting misinformation, January 23, 2024  5 months ago

City’s allowable losses reduced because they are a Football League Club!

In this post, I will look at the actual charges against City. What I didn’t realise before I started going through this was how contrived and how full of bulls**t these charges actualy are. This will soon become apparent…..

One of the first things to consider is tha the Premier League rules form a contract and this means the following principle applies:

Manchester City MCFC Scarf
Manchester City MCFC Scarf

Contra stipulatorem: a stipulation cannot be infered in favour of the party that wrote the agreement if another interpretation that favours the second party can be infered.

Since the Premier League wrote the contract, and City agreed to it, any doubts over what any of the rules mean, have to fall in City’s favour. This is oe of the area where UEFA tripped themselves up and it looks like this will affect this case too.

115 Charges

Journalists can’t count, so let’s start with the real figure of 134 charges.

Official Manchester City Scarf – PUMA3
Official Manchester City Scarf – PUMA3

134 Charges

The Arbitration Act 1996 governs how the commission set up by the Premier League should decide whether City have broken these rules or not. It is clear that if the Commission or any Appeal does not consider general English Law’s such as the Statute of Limitations Act 1980, then City have a right to have the decision reversed through the courts. We have to trust that the Commission will honour the law and throw out all charges prior to 6 years before the Premir League charged City on 6th February 2023.

I have therefore removed all the charges and allegations prior to 6th February 2017. This leaves:

60 Charges

So assuming many of the charges are time barred, this leaves 60 charges against the club, 30 of which are Allegation 5 – ie Failing to Co-operate.

Original Emails

City have been accused of failing to provide information (that might or might not exist), which corroborates the allegations made in Der Spiegel. This is despite the fact there is no evidence to suggest the emails published in Der Spiegel are genuine nor has any information as to how they were obtained has been provided. If these emails which Der Spiegel rely upon, are fabricated, then City wouldn’t have them and so couldn’t possible supply them. This is a circular argument. How have they failed to co-operate if this is the case?

City actually provided some of these emails in the UEFA case, so we know City have some of them. The original emails City provided at CAS demonstrated that what Der Spiegel had claimed could not possibly be true. So we have a simple either/or situation:-

  • Were the emails Der Spiegel publsihed genuine meaning City lied; or
  • Were the emails City produced genuine and Der Spiegel along with Rui Pinto fabricated the whole thing?

Now if Der Speigel (or Rui Pinto) had any other meta data, server logs or similar, which could back up the authenticity of their emails, surely they would have produced it by now? After all, a lot of this information is recorded in the header file of an email and they must have the original electronic files. However, they have not done this, all they have done is produce further emails, which couldhave just as easily been fabricated.

Man City Nero Scarf - Sky/Navy - One Size
Man City Nero Scarf - Sky/Navy - One Size

It is hard to beleive that the emails City presented at CAS have not found their way to the Premier League, and City will have almsot certainly provided copies (perhaps redacted).

Emails might not be in City’s Possession

Additionally, several of the (possibly fabricated) emails published by Der Spiegel shown here in the Daily Mail was sent from the EEA to Etihad Airlines. Manchester City have no power to access and supply emails between these two third parties. So how could they be guilty of not providing original copies of them if and when asked?

Fair Market Value / Databank

Then we have another elephant in the Room. The assessment of Fair Market Value and the transaction Databank. These were introduced in 2021 and affect all transactions dating back to 2016. It is a formal way of assessing whether a transaction is at Fair Market Value. Before assessing a transaction, the Premier League must ask the club to enter the transaction into the Databank. Since the accusation is that some of the transactions City have completed are not at Fair Market Value, such as the Etihad sponsorship deal, it is fair to say that the Premier League must have asked City to put these transactions into the Databank, otherwise they could not assess them under premier League Rules? If City don;t put them in the databank they cannot assess them. So either:

  • The Premier League did not ask City to put the transactions into the databank
  • The Premier League did ask City to put the transactions into the databank, and City did not comply
  • The Premier League did ask City to put the transactions into the databank, and City did comply

We have to assume the first option is false, otherwise the Prmeier League has broken their own rules and not assessed the transactions properly.

We also have to assume the second case is false otherwise City would be charged for breaching this rule (E72), and they have not been charged with this.

Therefore we have to asume that City have put relevant transactions in the databank. This is co-operation.

Manchester City MCFC Scarf
Manchester City MCFC Scarf

Six Year Time Limit

Under Company Law, limited companies must keep all relevant records for six years and also any required to comply with ongoing contracts, litigation or compliance. Company Law also requires records to be destroyed after six years if they are no longer required to meet any of the above ongoing matters. This means City shouldn’t actually have retained or have access to any information which is more than six years ago. The Premier League announced their investigation into City in September 2020. The investigating commission would have had to set up an office, recruit a team to conduct the inquiry and digest the terms of reference before doing anything. It is unlikely any requests for information were made to City until later that year. So it is hard to see how they could have expected City to be able to provide any information prior to 2015, (almost all of Der Spiegel’s allegations are prior to 2015).

By charging Manchester City for not providing information to them that is over six years old, they are suggesting that evey Premier League club should break the law and retain information that they shouldn’t?

So the inquiry was flawed from the start, it should not have been looking at events this far back.

It is quite clear that City will have co-operated to some extent, and in some areas they might not have been able to provide what the Premier League asked for. City might have been unwilling to do provide some information, after all the punishment for failing to co-operate is far less than the punishment if found guilty of these allegations. Therefore who in their right mind would give the Premier League everything they wanted, you would only provide what you felt you were legally obliged to do? This appears to be what City have done.

So that leaves just 30 charges.

30 Charges

Two of them in 2017-2018 and 2018-2019 are E60 (also E60 is cited as having been breached in 2016-2017 but that is time barred, so I can’t subtract it again!) This is what E60 says (I have added the pevious rule for context):

Yes you read rule E60 right!

City have not played in The Football League during the period they have been accused of. This is just crazy, I cannot see how this has any relevance or could have relevance to what Manchester City are accused of. Why would City reduce the amount they could lose in their accounts by £22m? Why would The Premier League reduce City’s allowable losses by £22m or £44m (if we add seasons T-1 and T-2) for playing in the Football League, when they clearly didn’t?

The only conclusion you can draw is that whoever has laid these charges on behalf of the Premier League against Manchester City is incompetant or stupid?…..Minus 2 more charges.

28 Charges

So the next 12 charges are breacing rules E3, E4, E11, E12, E51 and E53 (in seasons 2016-2017 & 2017-2018).

These rules basically say the club has to submit full audited accounts and financial forecasts.

I don’t think there is any question that City did not submit their accounts when they should, because if they hadn’t the Premier League would have investigated and punished City with immediate effect ie in 2018 and 2019. So it is obvious City haven’t breached these rules.

Now some folk will contend, “if the accounts are not a true and accurate reflection of the clubs finances then they have not submitted them.” This is silly, since rules B16 and E51 deal with this point… Minus 10 more charges.

16 Charges

The next section of rules define what happens (ie the sequence of events) after a club has submitted its accounts.

It is quite clear that these rules are linked and form a process. They are all about determining if a club which is losing too much money, has enough money to pay its bills. Firstly for the remainder of the current season and secondly, that it can fund the following season – ie fulfil its fixtures, pay wages, tax bills etc. Whether that is through new or enhanced commercial deals, owner investment etc.

The purpose of these rules are about sustainability, and taking action if a club gets into financial difficulty, to ensure the league fixtures are fulfilled to maintain the integrety of the competition. They are not there to retrospectively punish a team after the event.

Therefore you can conclude that by levying these charges in this manner, the Premier League is misusing its powers. The Premier League is deliberately trying to undermine Manchester City. In other words this is corruption. The reason the Premier League is doing this is because clubs like Arsenal, Liverpool and Manchester are acting in unison to lobby the Premier League. They are therefore abusing their dominant position in the market, which is a criminal offence.

[ It is interesting that Manchester City have been accused by The Premier League of breaching rules to comply with UEFA FFP. One of the rules of UEFA FFP is that a club’s debt must not exceed it’s turnover. Both Chelsea and Manchester United are currently in breach of this rule, as have Arsenal and Liverpool been in the past. Yet there is no suggestion of charging them? ]

I have summarised these rules below to make them easier to understand.

  • Rule 54 basically states that the board will assess if a club’s commercial agreements (such as sponsorship) have been made at a Fair Market Value.
  • Rule 55 then states that the board must tell the club what they think a Fair Market Value is, and whether the accounts should be adjusted.
  • Rule 56 then states that if this is the case, the board must then ask the club to re-submit the accounts.
  • Rule 57 states that after the club has resubmitted its accounts, does the board think the club has enough money to fulfill it’s fixtures for the remainder of the season.
  • Rule 58 then states, what should happen if the board doesn’t think the club has enough money. The club must by March 31 the same season, provide a forecast as to how it will fulfill it’s fixtures for the remainder fo the current season and the following season.
  • The end of Rule 58 and start of Rule 59 then states that the board can then excercise Rule E15 which means that restrictions can be applied to the club regarding setting a budget to work to, limits on signing players etc.
  • Rule 59 also states that the board must then charge the club with breaching the rules by followng the rules in section W.

In the Handbook for the years in question, Rule 54 did not define how Fair Market Value should be assessed. It has in more recent years, as mentoned above, been detailed extensively. However, the relevance seem mute. These seasons have already taken place and City fulfilled their fixtures.

Rule 57 is also bizzare one to accuse City of breaking, City did fulfill all their fixtures and met all their financial obligations. So how can they be punished after this event has passed for potentially not being able to do it? This is an even more bizzare charge when you consider the owner is the richest man in the world and would have no problem providing the necessary funding if this was the case… Minus 2 more charges.

14 Charges

Two dates should be glaringly obvious.

  • 1st March – Each club had to submit their accounts for the previous season by 1st March (Rule 53)
  • 31st March – Each club has to present a plan to remedy their financial position by 31st March (Rule 58), if they have been asked to under rule 56.

This means the steps defined by rules 54, 55, 56, 57 and 58 all have to be completed between these two dates. An obvious flaw in the rules is that there is no indication as to how long the board can take to complete rules 54-57 and how long the club is left with to respond under rule 58.

How can City be charged with breaching rules 54, 55, 56 and 57, when it is the Premier League Board’s responsibility to do them, and they need to do them before 31st March in each relevant year?

Regardless, City cannot be guilty of of breaching rule 58, if they were not even asked to comply with it before 31st March 2018 (for the 2016-2017 season) and 31st March 2019 (for the 2017-2018 season).

Finally, rule 59 states, that as result of this process the board must then refer the club if it is in breach, to disciplinary action as defined under the rules in section W. However, rules 54-59 are clearly a sequence of events, which didn’t happen when they should have happened. Most notably:

  • The Premier League Board cannot undertake rule 57 retrospectively because the subsequent fixtures have been played, and
  • City have not been asked to, nor have they completed rule 58, therefore rule 59 cannot be enacted, nor can City be considered to be in breach of it.

Since this is in the past and didn’t happen, Rule 59 should not be activated.

.. Minus 14 more charges.

2 Charges

So the only two charges left standing, are a potential breach of Rule B16 in 2016-2017 and 2017-2018, ie have City acted in good faith?

[This is the rule Liverpool famously broke when they hacked into CIty’s scouting system but werenlt punished for it.]

All the Premier League Board has to base this on is the repeated allegations made by Der Spiegel in various articles referencing the hacked emails provided by Rui Pinto. I have detailed elsewhere why the information printed in the Der Spiegel and its source Rui Pinto should not be trusted. If there is any truth in any of this, why haven’t Der Spiegel or Rui Pinto provided any information as to:-

  • The validity or the authenticity of this information, or
  • How this information was obtained?

Even though they should be destroyed, there will be server records which can corroborate or refute whether this information is genuine or not. So in the absense of any supporting evidence, I would find it very hard for them to hold this as being the truth. ie there is no evidence City did not act in utmost good faith.

.. Minus 2 more charges.

0 Charges

Quod Erat Demonstrandum