Manchester City case puts UK-UAE relations under ‘significant strain’

The Premier League’s ruling on Manchester City’s 115 alleged financial breaches has put “significant strain” on diplomatic relations between the United Kingdom and the United Arab Emirates, with billions of pounds of investment potentially at stake.

Bloomberg UK reports that “frustration on both sides” has intensified since the outcome of the investigation. Manchester City are owned by a private company run by Sheikh Mansour, a member of Abu Dhabi’s royal family and vice-president of the UAE.

The club were found guilty of the vast majority of the charges brought against them by the Premier League. The league said this week that sponsorship agreements it described as “sham” had been overstated by about £900m.

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Manchester City confirmed on Thursday that they had appealed against the verdict. If that appeal fails, possible sanctions include a points deduction, substantial fines or expulsion from the Premier League.

Premier League chief executive Richard Masters said Manchester City had “systematically broken” the rules for almost a decade. He described the Independent Commission’s decision as “the most significant in Premier League history”.

Manchester City’s position is understood to be that the money in dispute came from sponsors owned by the Abu Dhabi government, rather than from the club’s owners. The club argues that this meant the payments did not breach Premier League regulations.

According to Bloomberg, Emirati officials have warned the UK government that the severity of the ruling could affect their willingness to make further large-scale commitments in the UK. The report also says UK officials are frustrated by the actions of some of their UAE counterparts during the dispute.

The UAE has invested more than £30bn in major UK industries in recent years, including defence, life sciences and technology. An investment summit is scheduled for this month.

Mubadala Investment Company, one of Abu Dhabi’s sovereign wealth funds, is owned by Sheikh Mansour. Its chief executive is Manchester City chairman Khaldoon Al Mubarak.

Prime Minister Andy Burnham praised the impact of Manchester City’s owners this week and expressed concern about the possibility of losing their investment.

“I would be really concerned to lose them,” Burnham said. “They’ve been such a huge partner in the building of modern Manchester.”

He added: “I can’t intervene more in the process. It would be wrong for me to do that. It would be wrong, I think, to jump to a conclusion before having really studied all of the detail, but obviously it’s ongoing, and because it’s still contested by Manchester City, then I think it’s right that I don’t say much more.”

Burnham also thanked City Football Group and the club’s wider ownership for investment in the Etihad Stadium, the surrounding campus and Manchester itself.

Downing Street later sought to clarify his remarks.

“As the Prime Minister made clear, the initial judgement is serious and there can’t be any suggestion that anyone is above the rules,” a spokesperson said.

“He also stressed that it is an ongoing independent process. It is essential that it is allowed to run its course and the outcome respected. If wrongdoing is established, those responsible should face the appropriate consequences.”

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