UEFA rules say clubs owned by the same individual or legal entity cannot play in the same continental competitions; Man Utd have qualified for the Europa League along with fellow INEOS club Nice, while Man City are in the Champions League with sister club Girona - so what happens now?
Monday 3 June 2024 08:01, UK
Manchester United qualified for the Europa League by winning the FA Cup, but do they run the risk of being relegated to the Conference League?
United beat neighbours Man City 2-1 in the Wembley final on May 25, a result which put them directly into the Europa League group stage, but they are set to be joined by French club Nice, who are also controlled by INEOS founder Sir Jim Ratcliffe.
UEFA rules provide strict guidelines on clubs being owned by the same ownership structure, with no two partnered teams allowed to play each other in the same competition.
INEOS have released a statement since Man Utd lifted the trophy, which read: "We are aware of the position of both clubs and are in direct dialogue with UEFA.
"We are confident we have a route forward for next season in Europe."
With a similar situation affecting Manchester City and their sister club Girona, who have both qualified for the Champions League, Sky Sports takes a look at the rules and potential solutions for both clubs...
Under UEFA's multi-club ownership rules, no individual or legal entity can have control or decisive influence over more than one club in the same UEFA competition.
What does control and decisive influence mean? Well, there are four key parts of the criteria clubs have to meet: shareholders rights, financial support, club governance and transfers.
Shareholders rights: The UEFA Club Financial Control Body says a club has decisive influence over another club if the party they fall under, eg. INEOS, holds at least 30 per cent of both clubs, or if they have at least 10 per cent and they are the largest shareholder in the club.
Financial support: You have decisive influence if a club provides financial security to another club from borrowed money or if a club accounts to at least 30 per cent of the other club's total operating revenue.
Club governance: You have decisive influence if an individual has a position in both of the clubs' governing bodies, which include chief executives, sporting directors, club presidents and chief financial officers.
You also have decisive influence if a key figure in one club can remove members of the board, key executives and the first-team head coach at another club, as well as make key executive decisions across multiple clubs in terms of player transfers, deciding budgets and key commercial contracts.
Player transfers: A club has decisive influence over another club if they have transferred three or more players to the other club, or if they share the same scouts or scouting database arrangements.
If one of more of these criteria are met, then UEFA will make a more detailed assessment over whether decisive influence is being made, before making a decision over whether they can compete in the same UEFA competition.
For Manchester United, new minority investor Sir Jim Ratcliffe - whose INEOS group controls the club's football operations and owns 27.7 per cent of the club - is also the majority shareholder at French club Nice.
While Ratcliffe owns less than 30 per cent of United - therefore abiding by UEFA's rules through the shareholder rights, INEOS will need to prove to UEFA that they do not have decisive influence over both Nice and United through financial support and governance.
The precise roles of Ratcliffe and other key figures such as Sir Dave Brailsford will likely be investigated, given they are both directly involved at United and Nice. However, United have also hired key individuals such as academy director Jason Wilcox and chief executive Omar Berrada who are not involved at Nice.
Meanwhile, Manchester City and Girona have qualified for the Champions League group stage next season, with both teams owned by the City Football Group, a subsidiary of the Abu Dhabi United Group.
The City Football Group are the majority shareholders of Premier League champions City, while they also own 44.3 per cent of LaLiga club Girona. Another 16 per cent of the Spanish club is owned by Pere Guardiola, the brother of City manager Pep.
It looks likely that the City Football Group will need to reduce their stake in Girona in order for both teams to qualify for the Champions League.
CFG have been offered several compliance options by Europe's governing body, which include selling parts of that stake in Girona to an independent third-party ownership via a UEFA-approved model to bring their ownership under 30 per cent.
Meanwhile, the City Football Group could have decisive influence over both City and Girona due to their transfer dealings this season.
Girona have also signed three players from CFG clubs this season, including right-back Yan Couto and midfielder Yangel Herrera directly from City. Brazilian winger Savio joined from another CFG club in Troyes and will reportedly move to City this summer, in a deal agreed in February.
City sporting director Txiki Begiristain is also the director of football at CFG, though Girona do have their own separate sporting director in Quique Carcel.
Both United and City's owners have until the June 3 deadline to arrange their ownership structure before presenting UEFA their plans regarding their partner clubs.
An independent panel will then decide whether those partner clubs can appear in the same competitions, with a ruling to be made by the start of the Champions League qualifiers in the middle of July.
It also means United and City are not allowed to sign or sell any players through Nice and Girona respectively while they are involved in these UEFA proceedings.
If partner clubs fail to meet UEFA's criteria, only one of the two partner clubs can appear in the same competition.
UEFA will then see which team qualified in the higher position in their league table as part of the criteria to determine which team gets to play in the higher tournament.
In United's case, as Erik ten Hag's side finished in eighth place in the Premier League and Nice secured a fifth-placed spot in Ligue 1, then the French side would take the Europa League spot and United would be relegated to the Conference League.
And as City finished top of the Premier League and Girona ended the LaLiga season in third spot, then the Spanish side would have to move to the Europa League, leaving just City in the Champions League.
As per UEFA rules, a club which is not admitted to the competition is replaced by the next best-placed club in the top domestic championship of the same association.
That would mean Chelsea would be promoted to the Europa League to take up United's spot, should INEOS fail to meet UEFA's criteria.
And Athletic Bilbao would be the main beneficiaries of Girona not making the Champions League, as they would be promoted to Europe's top table courtesy of their fifth-placed finish in LaLiga.
Yes, very recently in fact.
Aston Villa were forced to change their ownership structure in partner club Vitoria de Guimaraes as both clubs played in the Europa Conference League last season.
Villa owners Nassef Sawiris and Wes Edens bought a 46 per cent stake in the Portuguese club in February 2023 but had to reduce that to 29 per cent last summer to comply with UEFA shareholders rules.
Brighton owner Tony Bloom also had to reduce his stake in sister club Union Saint-Gilloise after the Belgian club joined the Seagulls in the Europa League last season.
However, both Brighton and Villa were told by UEFA they were not allowed to exchange players - via transfers or loans - before the end of the 2024 summer transfer window. The same will apply to City and United if they are allowed to play in the same competitions as their partner clubs.
AC Milan and Toulouse were also allowed to appear in European competition together despite being owned by Red Bird Capital, as UEFA found them an independent third-party investor so they could balance the shares between the two clubs to meet the criteria.
