By Martin Graham
French football club Lyon has officially been demoted to Ligue 2 due to severe financial problems. The decision came from the DNCG, the organization responsible for regulating the financial operations of professional clubs in France. Although the ruling was initially made in November, club representatives, including owner John Textor, failed to reverse the decision during a meeting on Tuesday.
The DNCG concluded that Lyon had not taken enough steps to rectify their financial issues, despite recent efforts. Textor’s Eagle Football Group, which controls a 77% stake in the club, previously reported debts totaling £422 million. In a statement released following the announcement, Lyon described the verdict as “incomprehensible” and declared their intention to appeal.
Implications for European competition and Crystal Palace
Lyon’s drop to the second division could have a broader impact on European competitions. The club’s sixth-place finish in Ligue 1 secured them a Europa League spot, putting Crystal Palace’s participation in jeopardy due to UEFA’s regulations regarding shared ownership across competing clubs.
Textor currently holds a stake in Palace, although he has agreed to sell his 43% share to Woody Johnson, the owner of the New York Jets. If the sale is not finalized, Palace may lose their place in the Europa League, as UEFA does not permit multiple clubs under one ownership group to play in the same tournament.
Club responds to relegation and outlines recent moves
In their public response, Lyon emphasized the strength of their recent financial actions. They highlighted the sale of Maxence Caqueret to Como and Rayan Cherki to Manchester City, which brought in approximately £45 million. The club also parted ways with high-salary players like Alexandre Lacazette and Anthony Lopes.
Textor had previously dismissed the possibility of relegation, stating in November that it would not happen. Speaking before the DNCG hearing, he insisted that the club’s finances were in good shape, citing recent investments.
The club believes it has now met all the requirements set by the DNCG through capital injections and the Palace sale. Lyon maintains that their financial state is secure for the 2025–26 season and will continue their appeal in hopes of overturning the decision. If the ruling is upheld, Reims, who lost the play-off against Metz, would remain in Ligue 1 in Lyon’s place.
Lyon, who have won the French league seven times and last played outside the top tier in 1989, were also Champions League semi-finalists as recently as 2020.
