Exclusive: Manchester City secure deal for first refusal on Brazilian talent

Link up with two Portuguese clubs will give Premier League side a competitive advantage in the recruitment of Brazilian players

Manchester City have secured a commercial interest in two Portuguese clubs that will give them a competitive advantage in the recruitment of Brazilian players and may boost future attempts to pass Uefa's Financial Fair Play test.

City are providing "scouting, marketing and merchandising advice" at Gil Vicente, a club in northern Portugal, and also pursuing shares in Boavista, the Porto-based club, according to sources in that country.

City's advantage in recruiting Brazilian players would stem from a Portuguese immigration treaty with Brazil, its former colony, which confers the same rights on Brazilians as Portuguese workers. City could use the clubs to develop players for whom they are unable to secure UK work permits – then move them to Manchester once they have acquired the requisite experience to qualify for a UK permit, or sell them for profit. Since third-party ownership of players, outlawed in Britain, is also permitted, Portugal provides potential for City to have first call on players who could thus be bought cheaply.

Gil Vicente, with seven Brazilians on their books, said the City partnership would bring it "sustainability, projection, prestige" and an "international dimension". Deals with the two clubs may also help City account for some of the huge revenues they have claimed for the sale of their intellectual property to "related parties" – £22.45m in the recently published 2012/13 annual accounts – in order to help pass their impending FFP test. City must show as much revenue as possible to offset losses and come within the FFP figure of £37m lost over the last two seasons.

City say they earned the £22.45m by selling scouting and commercial services to their own Melbourne Heart soccer franchise, Manchester City Ladies FC and their New York City FC – City's new Major League Soccer club. But Melbourne was only bought last month and the women's team requires an entirely different scouting system to the men's side. Analysts are subsequently baffled as to how the new US venture could possibly have contributed so substantially to City's revenues.

The new Portuguese ventures may generate intellectual property sales to boost City's hopes of FFP compliance, though both are modestly financed clubs.

The deals, which the club declined to discuss this weekend, appear to have been engineered by City's Partnership Sales Manager, Francisco Lampreia, who was formerly marketing director at Boavista. Lampreia and City chief executive Ferran Soriano visited Boavista three months ago and appear to be seeking a share in the club.

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