Financial Fair Play Rules UEFA Explained

Manchester City manager Pep Guardiola
Manchester City manager Pep Guardiola / Catherine Ivill/Getty Images

A bombshell was dropped on the soccer world Friday when it was revealed Manchester City had been banned from the Champions League for two seasons due to violations of UEFA's Financial Fair Play rules. On top of the two-year ban, City was also fined 30 million euros, or $32.5 million. While they're likely to appeal via the CAS, or Court of Arbitration for Sport, for now this is a precedent-setting punishment.

Well, for those confused as to what went down, here is an explanation of the Financial Fair Play rules:

UEFA Financial Fair Play Regulations

UEFA's Financial Fair Play Regulations were created in 2009 in order to prevent teams from spending more money than they earn -- which in turn creates longstanding financial problems. Sanctions are handed down to clubs who overspend for a period of several seasons.

Manchester City Champions League Ban

Manchester City reportedly violated the FFP by falsely inflating sponsorship revenues, particularly that from Etihad airlines, which is owned by the family of City's owner, Sheikh Mansour bin Zayed al-Nahyan. Leaked documents showed that only $8 million of the $67.5 million Etihad sponsorship was being paid for by the airline itself, with the rest being funded by the Abu Dhabi United Group.

A statement from UEFA read, "...Manchester City committed serious breaches of the Uefa Financial Fair Play Regulations by overstating its sponsorship revenue in its accounts and in the break-even information submitted to Uefa between 2012 and 2016."

Suspension from European competition is considered to be the harshest form of punishment which could stem from violations of the FPP, and City's two-year ban will certainly set the tone and dissuade other clubs from violating the rules in the future.

As a result, should the punishment stand and Man City remain in the top-4 on EPL, the fifth place team would be allotted a spot in the greatest competition European soccer has to offer.