After seeing Lyon's relegation reversed, the Eagles could find themselves in European trouble.
Crystal Palace's dream of playing in the UEFA Europa League next season is on the verge of collapse following a major legal victory for French club Lyon.
The Eagles, who had qualified for European competition by winning the FA Cup, are now set to be demoted to the UEFA Europa Conference League, thanks to UEFA's multi-club ownership rules and Lyon's reinstatement in Ligue 1.
Lyon's appeal success leaves Palace reeling
On Wednesday, Olympique Lyonnais confirmed they had successfully appealed their relegation from France's top division, reversing a decision initially imposed due to financial irregularities.
The DNCG, the governing body in charge of French football finances, had demoted Lyon after a damning audit revealed debts of approximately €500 million. Crystal Palace had pinned their Europa League hopes on that punishment sticking.
Under UEFA rules, when two clubs with the same ownership qualify for European competitions, only the one that finishes higher in its domestic league is allowed to play in the superior tournament. In this case, both Lyon and Palace are majority-owned by John Textor's Eagle Football Holdings, but Lyon's sixth-place Ligue 1 finish trumps Palace's 12th in the Premier League.
Palace had hoped that Lyon's demotion would free them from the rule, but the French club's reinstatement has hit them hard.
UEFA rulebook causes ripple effect for Forest and the Eagles
The chaos does not stop at Selhurst Park. Nottingham Forest, who were initially set for the Europa Conference League, now stand to benefit from Crystal Palace's demotion.
If UEFA enforces the multi-club ownership rule to the letter, Forest will likely leap into the Europa League spot vacated by Palace.
While Palace officials had travelled to UEFA headquarters last month in a desperate bid to explain that Textor no longer had control over their operations, their failure to meet the March 1 deadline for ownership restructuring has cost them dearly.
Now, all eyes are on UEFA's final ruling, but the mood in south London is already one of bitter disappointment.
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