“The Investigatory Chamber of the UEFA Club Financial Control Body has decided to refer Italian club AC Milan to the Adjudicatory Chamber of the CFCB for breach of the Financial Fair Play regulations, in particular the break-even requirement. After careful examination of all the documentation and explanations provided by the club, the CFCB Investigatory Chamber considers that the circumstances of the case do not allow the conclusion of a settlement agreement. In particular, the CFCB Investigatory Chamber is of the opinion that, among other factors, there remains uncertainties in relation to the refinancing of the loan and the notes to be paid back in October 2018”.
Milan was hit with this unambiguous statement by UEFA yesterday, which refused to go through settlement agreement after denying the voluntary agreement in November. As made it clear by the press release, the Rossoneri are not only facing scrutiny for Financial Fair Play violations, but also for the financial sustainability of the plan put in place by the new owner Yonghgong Li, who has to pay back over €300M to the Elliott fund later this year.
A ruling is expected in mid-June and there are four possible sanctions: a fine, a roster reduction in Europa League, a suspension in the next transfer market window and the exclusion from European competitions next season. Milan clearly did not break-even last summer, hoping to have some leeway thanks to the change of ownership, but UEFA was not lenient. Other teams have been excluded from the cups in the past, mostly for major violations like to not paying the debts to other teams. In this case, the problem is multi-layered because it does not involve only the transfer market, so it can not be solved by simply selling some of their properties, like Gianluigi Donnarumma or Suso, to make the balance sheets breath.
Milan’s CEO Marco Fassone expressed surprise and disappointment for the ruling, especially because UEFA did not allow them to negotiate. He also lamented a damage to the club’s reputation and complained for the fact that the institution did not talk to the current financier of the holding company, Elliott, which could have provided a written guarantee of the club’s continuity. As a matter of fact, it is rumoured that fund will take over if Li does not find a way to reimburse them. Should Milan be excluded from Europa League, Atalanta will qualify to the group stage while Fiorentina will play in the playoffs.
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