TORONTO--(BUSINESS WIRE)--In this commentary, we discuss the industry-wide implications of the English Premier League’s (PL) allegations of inaccurate financial reporting and breach of Union of European Football Association’s (UEFA) Financial Fair Play regulations against Manchester City Football Club (City).
Key highlights include:
- UEFA recently changed its financial rules and appears to be enforcing them more strictly, handing out harsher penalties for violations.
- A harsher penalty system that is consistently enforced will ultimately benefit football clubs' credit risk profiles.
- We believe a sanction causing a City relegation is unlikely as this could (1) reduce the quality and popularity of the PL product and (2) revive the creation of the European Super League.
“UEFA and individual European football leagues have always had financial rules in place, but were lenient in terms of imposing penalties for clubs in violation. This could be changing. If the PL uses City as an example and enforces a harsh penalty on any proven offence, this could set the tone for football clubs going forward and result in more prudent financial management, healthier balance sheets, and improved credit profiles,” said Michael Goldberg, Senior Vice President of Sports Finance at DBRS Morningstar.
To read the full report and access the data, click here: https://www.dbrsmorningstar.com/research/409546/citys-going-down-with-a-billion-in-the-bank-could-a-harsh-manchester-city-penalty-benefit-the-football-industry
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