Arsene Wenger backed the ban UEFA handed down to Manchester City for breaching Financial Fair Play (FFP) regulations but acknowledged some "evolution" is needed in the rules.
UEFA announced on Friday that City had been handed a two-season suspension from European competition and a €30 million (£25m/$33m) fine for breaching their FFP framework.
The club have since confirmed they will appeal the decision at the Court of Arbitration for Sport (CAS).
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Former Arsenal boss Wenger is in favour of capping finances but believes further work is needed to ensure there can be no questioning the legality of certain actions.