Any legal action against Manchester City arising from the Premier League’s financial misconduct ruling against the club could be complicated by the fact that its Emirati chairman has diplomatic immunity, legal experts have said. 

Khaldoon Al Mubarak, who has chaired City since its takeover by a senior member of Abu Dhabi’s royal family in 2008, was granted diplomatic status by the UK in 2020. He is listed as an “economic counsellor” for the United Arab Emirates (UAE) embassy on the government’s most recent diplomatic list. 

Earlier this week, an independent commission confirmed it had found Manchester City – 10-time champions and widely regarded as the most successful Premier League team of the last decade – guilty of 114 charges relating to financial conduct rules governing England’s top flight.

The swingeing ruling found that City had created “sham” commercial contracts over a nine-year period from 2009 to 2018 in order to inflate revenues and conceal costs by more than £900m. 

If upheld, the cheating scandal findings could lead to sanctions with disastrous consequences for City, including a points deduction that would all but guarantee relegation from England’s top flight, lifetime bans for executives, and even a possible order for the club to be sold. 

Intricate legal fall-out from critical ruling

City and its owners have strongly refuted the findings and the club is expected to formally appeal against the commission’s findings ahead of a deadline of Friday. Mubarak, who regularly attends games, has not been accused of any personal wrongdoing and last weekend issued a statement underlining the club’s ongoing intent to prove its innocence. 

However, the formal status of City’s chairman as a UAE diplomat, first reported by , could complicate the increasingly intricate legal fallout from the club’s actions. 

The Premier League ruling has brought with it calls for a criminal investigation by the Serious Fraud Office or police, alongside the potential for civil action by other clubs arguing that they lost out on the pitch because of City’s breaches of financial and fair play rules. 

On Thursday, there were also calls from tax transparency campaigners for HMRC to investigate the possibility that City had failed to pay tax of £12m related to its employment of former manager Roberto Mancini. HMRC declined to comment, citing confidentiality rules. Mancini has denied any wrongdoing. 

‘Immunity applies irrespective of when conduct took place’

Under the Vienna Convention, the treaty which governs the diplomatic system, individuals with diplomatic status cannot be arrested or prosecuted in the country where they act as an emissary. They also enjoy significant protection from civil claims where it can be shown that any complaint relates to activities carried out as part of official duties. 

It has been established by The i Paper that because Mubarak was not formally a UAE envoy at the time when City was found to have committed its 114 financial breaches, he would not enjoy diplomatic immunity for that period.

But the fact that he now has diplomatic status means he would be immune from any criminal investigation, regardless of when any potential offences might have occurred. This immunity would remain in place until such a time as he ceased to be an emissary to the UK. 

Nick Vamos, a former head of extradition at the Crown Prosecution Service and now head of business crime at City law firm Peters & Peters, said: “If Khaldoon Al Mubarak has diplomatic immunity now then it applies to him now irrespective of when the conduct in question took place. The immunity protection applies to him personally for as long as he has it.” 

Neither Manchester City nor the UK embassy of the UAE responded to requests to comment on Mubarak’s diplomatic status, or the possibility of additional legal action against the club. 

Threat to relations with crucial Gulf ally

Following the publication of the commission’s findings, the club issued a statement declaring its “surprise and disappointment”. City said: “The Club is innocent of the accusations made by the Premier League and a comprehensive body of irrefutable evidence exists in support of all of its positions relating to this case. The club will therefore be relentless, and where necessary proactive, in any and all appropriate regulatory and legal forums.” 

The legal travails faced by City threaten to unsettle official relations between the UK and UAE, a key Gulf ally alongside Saudi Arabia. Under a 2021 agreement, Abu Dhabi’s sovereign wealth fund – Mubadala – leads a consortium which has generated £30bn in inward investment for the UK. Mubarak is the chief executive of Mubadala.  

Peter Cruddas, a Conservative peer whose online trading company CMC Markets sponsors Everton FC, this week nonetheless suggested the Premier League findings of failures to submit accurate accounts could be grounds for a criminal investigation into potential false accounting at City. 

He told : “Surely the Man City findings are now a police matter. If accounts have been falsified and auditors have been misled, then it is potentially a criminal matter. The auditors will call in the police, directors are personally libel [sic] for any fraud of a UK company, even if it is foreign-owned.” 

Legal sources pointed out that any such investigation would have to apply the law at the time of any alleged offence, which would require prosecutors to meet a challenging test of proving the complicity in fraud of a “directing mind” at any accused company or entity. New legislation has updated the law with the aim of making such cases easier to bring but this would not apply to any investigation into City’s actions between 2009 and 2018. 

One senior lawyer said: “Proving a ‘directing mind’ in fraud cases is notoriously difficult. I don’t think any prosecutor would relish such an investigation.”  

From compensation to points deduction: City’s potential legal problems

At the same time, a possible criminal investigation does not represent the end of City’s potential future legal travails. 

A number of civil claims for compensation or the enforcement of rules governing football may yet be presented to the club. Sitting alongside possible complaints from other Premier League clubs is potential action by the newly-created Independent Football Regulator (IFR). 

The watchdog has the power to assess the suitability of the owners of a football club and can take action such as banning individuals from being directors or even forcing a sale. 

David Kogan, the IFR’s chairman, this week underlined that the body would not intervene unless or until the Premier League process has been completed. At the same time, he added that the IFR would not hesitate to use its powers “in the interests of protecting the sustainability, honesty and integrity of English football where there is clear evidence of wrongdoing by individuals”. 

Riddle over diplomatic immunity if City face civil claims

Alongside blanket protection from criminal prosecution, the rules surrounding diplomatic immunity offer significant  – though not absolute – protection from civil legal action. 

The Vienna Convention allows diplomatic immunity to apply to commercial activity if it can be shown that it was carried out as part of an envoy’s official duties, rather than in a private capacity. 

Consequently, any civil claim against City may involve a court having to unpick where its chairman’s official and private duties begin and end. 

Vamos said: “I agree in principle that the line between official and private acts may not be easy to draw.” 

Alongside his role at City and Mubadala, Mubarak chairs Abu Dhabi’s Executive Affairs Authority, the equivalent of the UK’s Cabinet Office, and acts as the emirate’s main liaison with the Trump administration. 

As part of its defence, City has insisted that investment said to have broken rules by allegedly originating from the club’s owner, Sheikh Mansour bin Zayed Al Nahyan, actually came from the Abu Dhabi government in the shape of financial aid to sponsors. As such, this would have been within Premier League rules, it is claimed.