UEFA postpones call on Crystal Palace's European spot pending Lyon decision

New York Times

a day ago

Crystal Palace's hopes of playing in the Europa League next season appear to hinge on Olympique Lyonnais failing to overturn their relegation to Ligue 2 this week after UEFA postponed its judgment on whether Palace and Lyon breach its multi-club ownership (MCO) rules.
The Premier League side thought they had qualified for UEFA's secondary club competition as a reward for winning the FA Cup last month, but European football's governing body has not confirmed their eligibility because their co-owner John Textor also owns Lyon, who qualified for the Europa League by finishing sixth in Ligue 1.
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Under UEFA's MCO rules, when two or more teams under the same ownership qualify for the same competition, only the team that finishes highest in its domestic league – and Palace came 12th last season – can participate, with the other team or teams either dropping into a lower UEFA competition or missing out entirely.
However, there is a significant caveat to these rules in that the important issue is whether the common owner has 'control or decisive influence' over the clubs.
If the owner's shareholding is considered to be minor in one of the clubs, with 30 per cent being the rule of thumb, or enough legal separation can be created between them, UEFA has allowed several clubs in MCO groups to play in the same competition.
This is the argument Textor and his fellow shareholders at Palace have been making to UEFA. The American businessman does control 43 per cent of the south London club's shares via his Eagle Football Holdings Ltd but – under the club's shareholder agreement – he only has 25 per cent of the votes.
And, with Palace chairman Steve Parish opposed to the idea of integrating the club into the Eagle group, Textor's influence at Selhurst Park has been limited to his injection of about £110million ($150.7m).
To complicate matters further, Textor has subsequently agreed a deal to sell his stake in Palace to New York Jets owner, and former U.S. Ambassador to the UK, Woody Johnson.
However, UEFA finds itself in the difficult position of not wanting to make an unpopular decision – and preventing Palace side from taking up the Europa League berth they earned by winning a first trophy in the club's history – but also having to apply its rulebook in a way that is consistent with its recent decisions on MCO matters.
UEFA first tried to address the MCO issue, which has obvious implications for the integrity of its competitions, in the late 1990s when it stopped several European clubs owned by UK-based investment firm ENIC from competing in the same competition. It was that ruling which established the idea of control being the key consideration.
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The rule was not challenged again until RB Leipzig and Red Bull Salzburg both qualified for the Champions League in 2017, although both were allowed to play in the competition after their owner, the Austrian energy-drink giant Red Bull, made various legal and personnel changes to create distance between the clubs.
But with MCO groups proliferating in recent years, UEFA has been forced to make these assessments every summer, most notably in 2023 when it forced the owners of Aston Villa and Portugal's Vitoria, Brighton and Union Saint-Gilloise in Belgium and AC Milan and France's Toulouse to either dilute their shareholding in one of the clubs or effectively put one in a blind trust.
A similar dynamic played out last summer when distance was created between stablemates Spanish side Girona and Manchester City, and Manchester United and Ligue 1's Nice.
The uncertainty created by these examples persuaded UEFA to tweak its MCO rules this season by bringing forward the date for when such changes needed to be made by three months. And it is this shift that seems to be causing Palace real issues.
In a statement released by UEFA on Monday, it confirmed it was blocking two other teams in MCO groups from taking their places in the Conference League. As a result, Denmark's Silkeborg and Hungary's Gyori ETO can participate but their respective sister-clubs Drogheda United of Ireland and Slovakia's Dunajska Streda cannot.
Drogheda United have already tried and failed to appeal against this decision at the Court of Arbitration for Sport.
If that decision did not already cause alarm at Palace about their fate, UEFA's decision to delegate this matter to French football's financial watchdog the DNCG may do.
The UEFA statement confirms it is happy with Lyon's financial position but adds that the French club 'agreed on exclusion from the 2025/26 UEFA club competitions should the French authority confirm the club's relegation to Ligue 2'.
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This is a reference to last week's news that the DNCG had gone through with its threat to relegate Lyon for what it believes is a significant hole in its finances.
The decision stunned Textor and his fellow investors and lenders at Eagle Football Group, as he says Lyon has plenty of cash following the sale of his Palace shares and the transfer of Rayan Cherki to Manchester City.
But even without those recent windfalls, he believes the DNCG fundamentally misunderstands his MCO model and it should not take such a narrow view of Lyon's balance sheet but instead look at the health of the whole group.
Eagle has already launched an appeal of its relegation and it is expected to take place in the coming days. Textor is very confident of success but he was also confident the last time he met the DNCG.
If he does succeed in persuading the DNCG to overturn its decision, Lyon will remain a Ligue 1 club and be able to play in the Europa League.
This will force UEFA to announce a decision that it surely would have already published if it had gone in Palace's favour.
If, as seems likely, Palace and Lyon are deemed to have breached the MCO rules, the English club will drop into the Conference League.
Ironically, another of Palace's co-owners, American investor David Blitzer, also owns Brondby who have reached this competition but his stake at the Danish club is not large enough to cause any issues.
In the meantime, Textor, 59, has agreed to step away from Lyon in order to focus on Botafogo, Daring Brussels and his search for a new English club to replace Palace in Eagle's portfolio.
Taking over at Lyon are American businesswoman and Eagle investor Michelle Kang, who already owns a majority stake in Lyon's women's team, as president, with former Bayern Munich chief financial officer Michael Gerlinger becoming chief executive.
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'Each of our clubs and communities deserve leadership, with a strong local presence, and the acumen to overcome both the sporting and the non-sporting challenges that we face,' said Textor in an Eagle press release.
'It's obvious to everyone that Michele is a perfect choice to lead (Olympique Lyonnais), and I am thrilled for our community that she has accepted the job.
'On a personal level, I am truly looking forward to the reduction of my day-to-day management responsibilities in Europe, so I can focus on markets where we have the full freedom to run our football clubs, to invest, innovate, grow and compete.
'OL (is) in great hands with Michele, and I will focus on Botafogo, Daring Brussels and our next club in England.'
By Crystal Palace correspondent Matt Woosnam
The decision to postpone a ruling on whether Palace and/or Lyon will be admitted to the Europa League next season continues the agonising and frustrating wait for both sets of supporters.
Palace fans should be free to bask in the glory of their FA Cup victory, the first major trophy in the club's history, but instead are being forced to contemplate the possibility of being knocked down to the Conference League.
The wait for an outcome goes on and it is those fans who will suffer.
For some, it has slightly overshadowed the success of a best-ever Premier League season in terms of points and the cup win. For the club, it means potential delays in planning for the new season, something they had been eager to avoid given last season's slow start was partly caused by their late transfer dealings with four players arriving on deadline day.
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