Lyon Faces Ligue 2 Demotion After Financial Setback

Europa League Hopes Uncertain Amidst Financial Turmoil

French football is rocked by news that Lyon is facing relegation to Ligue 2. This follows the club’s failure to satisfy financial regulations set by the Direction Nationale du Contrôle de Gestion (DNCG), potentially impacting their European ambitions.

DNCG Decision and Textor’s Response

The DNCG, French football’s financial watchdog, has demoted Lyon to Ligue 2. John Textor, the club owner, attended a hearing and shared a positive outlook.

“You can see from the contributions of our shareholders, we have invested new capital, not only for the DNCG, but also for our UEFA licensing process,”

—John Textor

Despite these assertions, the DNCG decided Lyon had not met the required financial standards for Ligue 1. The club now has a week to appeal, possibly delaying the final decision. The French professional football league (LFP) regulations stipulate that if a club is denied entry to Ligue 1 due to financial or disciplinary issues, the losing team from the relegation play-off could be reinstated. Recent data from Deloitte shows that over the past decade, more than 10% of European clubs have faced financial penalties (Deloitte 2024).

Europa League Implications

Textor recently made headlines regarding uncertainty surrounding Crystal Palace’s spot in next season’s Europa League. He agreed to sell his 43% stake in the Premier League club to Woody Johnson.

This move aims to resolve a conflict with UEFA’s multi-club ownership rules. Both Lyon and Crystal Palace qualified for the Europa League which creates a conflict with UEFA’s rules.

UEFA regulations demand clubs settle any multi-club ownership issues by March 1, 2025. Selling his Palace stake was a belated attempt by Textor. If Lyon is deemed ineligible, Palace would not face demotion to the Europa Conference League.