PARIS (AFP) - UEFA want to fine Paris Saint Germain and Manchester City 60 million euros (S$104 million) and limit their Champions League squads for breaching spending regulations, sources said Tuesday.
But Paris coach Laurent Blanc said the French club would be "a great team" next season even if it was punished.
The European governing body has focused on the two Middle East owned clubs among nine facing sanctions as part of a campaign to enforce its Financial Fair Play regulations.
According to sources close to the investigation, UEFA has proposed a fine of about 60 million euros against Paris and Manchester.
Both would see their player wage bills capped at the current level, for Paris that is about 280 million euros.
They would only be able to use a squad of 21 players instead of 25 now and would only be allowed to buy one player for a maximum 60 million euros in the next transfer window in August, the sources said.
A UEFA spokesman said the final decision of the Club Financial Control Board has not yet been sent to the clubs involved.
Media reports say that Paris are close to reaching agreement with UEFA however.
A source close to the club told AFP that PSG is already planning for next year in line with the sanctions.
It is not known whether City will reach an accord with the governing body by Friday's deadline.
If no deal is made, City could go to an arbitration panel which could impose a non-negotiatable penalty.
PSG coach Blanc said: "We have to see if the sanctions are confirmed. But despite everything, Paris will still have a great team next year.
"You have to take account of everything. We'll have to target things well, be smart. We'll have to be accurate. But we already have very good players," he said.
The limit on squad sizes and signings could force Paris and City to use more home grown talent.
"It may not be the worst evil but if you have the right to only 21 players and not 25, it is more difficult," said Blanc.
City manager Manuel Pellegrini told a news conference he would wait until UEFA's official announcement of sanctions before commenting.
"When it is official news of UEFA we can analyse what happens with the team. In this moment we don't know what happens," he said.
UEFA introduced its fair play rules in a bid to force clubs to live within their means.
The sanctions are designed to restrict spending and force clubs to limit losses in future seasons.
Clubs can lose up to 45 million euros over the last two years under UEFA's rules.
City, which is owned by Abu Dhabi, accumulated deficits of £97.9 (120 million euros) in 2012 and £51.6 million last year, but were able to write off sums spent on facilities, youth development and other items.
Qatari-owned Paris and City have a number of sponsorship deals linked to their owners which UEFA investigated.
PSG effectively wiped out its annual losses of 130 million euros by announcing a back-dated sponsorship deal with the Qatar Tourism Authority worth up to 200 million euros a year.
UEFA president Michel Platini has already said he does not expect any of the clubs under investigation would be barred from European competition next season.