Man City respond as La Liga ‘file legal complaint’ against Premier League champions | OneFootball

Manchester City have been accused of an Enron-style financial deception by La Liga president Javier Tebas.

Tebas said the Spanish league filed a complaint against City to the European Commission in the summer of 2023, which he says the Commission is investigating. City have not commented on Tebas' allegations but club sources are aware of them, and strongly refute them.

Tebas claims City used related companies in the United Arab Emirates to hide losses and thus improve the club's own balance sheet, and compared it to the Enron scandal.

Enron executives were found to have reaped millions by using a web of partnerships to generate false profits and hide the company's true debt.

Tebas said in a press conference at the Financial Times Business of Football Summit: "City have a lot of companies in their group which lie outside the City Football Group structure, extra companies where they put their expenses.

"These other companies lose the money but not the club itself. We have reported them to the European Union (sic). We have the facts and figures.

"We asked for City to be checked. It's very important that all clubs are subject to the same transparency rules and governance on both the sporting and financial side.

"The City case is one where we believe they have put the losses on the companies that are not officially part of City Football Group.

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City sources said Tebas has a long history of attacking the club (Getty Images)

"Do you remember the case in the United States? The Enron case. What they did, they got their losses and they put them into different companies. Well, it's a similar case."

Tebas claimed: "They (City) have a scouting company, a marketing company. That's where they have very high expenses. They invoice City for less money.

"City have costs that are less than if they didn't have this circle of companies around."

Asked about the status of the complaint, Tebas replied: "I think it is in the investigation phase. We haven't had a reply, so it must be in the investigation phase."

City declined to comment, but sources close to the club said Tebas has a long history of attacking City.

City are understood to strongly refute the allegations and sources pointed to the club's accounts, which are a matter of public record, as proof of no wrongdoing.

Details of La Liga's complaint, seen by the PA news agency, allege City's financing mechanisms cause a serious distortion in the internal market of the European Union.

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(Getty Images)

The complaint was filed under European regulation governing state subsidies, on the grounds that City are alleged to have received foreign subsidies from the United Arab Emirates. La Liga alleges that allowed the club to enhance its competitive position and cause significant distortions across various national and EU markets.

These foreign subsidies, La Liga alleges, enabled the club to sign top-tier players and coaches far beyond what would be feasible under normal market conditions and to secure sponsorship revenues at levels that do not align with fair market value.

This, in turn, La Liga alleged, improved the club's sporting performance while also impacting the recruitment capacity of rival clubs.

The claims from Tebas come at a time when City are separately awaiting a verdict from an independent commission after being charged by the Premier League in February 2023 with more than 100 breaches of Premier League rules, which they strenuously deny.