In yet another attempt to limit Manchester City and Newcastle’s financial power, the Premier League is proposing to introduce new rules prohibiting clubs from utilizing their feeder and/or satellite teams to pay players and coaches.
The new rules will be part of tighter limitations on related-party sponsorship deals that are expected to be ratified later this month in reaction to Newcastle’s £305 million Saudi Arabian-led acquisition.
Newcastle’s new owners have stated that they intend to adopt the City Football Group model of forming a global network of teams, raising concerns among some Premier League opponents that such a structure may be used to avoid Financial Fair Play restrictions.
Former City manager Roberto Mancini appeared to have received two salaries while at the club, according to documents obtained by the Football Leaks website in 2018. One was paid directly by the club, while the other was funded by the Al Jazira Sports and Cultural Club, an Abu Dhabi club also controlled by City’s owner, Sheik Mansour.
Any payments to players or staff from associated parties, including sponsorship deals, will have to be declared to the Premier League and factored into financial regulatory calculations under the new laws.
The city was accused of seeking to avoid FFP by concealing half of Mancini’s compensation.
The documents appeared to show that the Italian signed two contracts on the same day he arrived at City in 2011 — one worth £1.45 million per year with City and another worth £1.75 million with Al Jazira, both of which were paid into an offshore shell company based in Mauritius — but the club was never charged with any rule violations.
Since Mansour founded the City Football Group in 2013, it has grown to include ten clubs spread across five continents.
Newcastle has similar aspirations, and its owners have already held conversations with several European clubs, notably Inter Milan and Bordeaux, about purchasing a stake in the club, but have yet to reach an agreement. Despite their initial objections, City and Newcastle have come to terms with the fact that stricter controls are unavoidable.