Manchester City’s recent guilty verdict has sparked a search for historical precedents to gauge the club’s possible future. The most frequently cited comparison is the 2012 collapse of Rangers, the Scottish giants who were forced to restart from the bottom of the league pyramid after a financial collapse. While the circumstances differ, the parallels in sanctions, loss of honours and the threat of expulsion from the top tier have led pundits to draw cautionary lessons for City.
Rangers’ downfall began with a massive tax liability tied to an Employee Benefit Trust (EBT) scheme that paid more than £47 million to over 80 individuals, including players, managers and directors. HM Revenue & Customs argued the payments should have been taxed as earnings, and after a protracted legal battle the Supreme Court ruled in HMRC’s favour. The club entered administration in February 2011‑12, received a 10‑point deduction, finished second in the league and was subsequently liquidated in June 2012. The club’s assets – its name, badge, Ibrox stadium and training ground – were purchased by a new company led by Charles Green. Although the team continued to play at Ibrox, the Scottish FA required Rangers to apply for admission to the lower divisions, and the majority of clubs voted to place the new entity in the fourth tier.
In contrast, Manchester City has been found guilty of “sham contracts” that concealed more than £830 million of funding, violating Premier League financial rules between the 2009‑10 and 2017‑18 seasons. City is appealing the verdict and denies any wrongdoing. The Premier League has not yet imposed a sanction, but the possibility of expulsion has been floated. If that were to occur, City would face a scenario similar to Rangers: an application to the English Football League would be required, and the club would effectively have to rebuild its squad and finances from scratch.
The financial impact on both clubs was stark. Rangers’ demotion threatened television revenue and the lucrative Old Firm derbies, and the club’s chief executive warned that broadcast income would shrink, though the reduction was described as “slight”. For City, the loss of Premier League status would likely trigger a significant drop in TV money and sponsorship, with long‑term implications for the club’s global brand.
Ally McCoist, Rangers’ manager during the collapse, reflected on the human cost of the crisis. He described the experience as “absolutely horrendous”, citing job losses and the emotional toll on staff and players. McCoist also recalled the bizarre moments of the lower‑league campaign, such as a match delayed because the ball was stuck on a hedge. He stressed that when a club is demoted, players typically leave, forcing a new team to be assembled from scratch – a reality he believes would apply to Manchester City if they were expelled from the Premier League.
With the Premier League still awaiting the outcome of City’s appeal, the club’s future remains uncertain. The Rangers case serves as a cautionary tale: financial mismanagement can lead to severe sanctions, loss of honours, and a forced restart at the bottom of the football pyramid. Whether City can avoid a similar fate will depend on the Premier League’s final decision and the club’s ability to navigate the complex regulatory environment.