AC Milan's hopes of qualifying for the Champions League have been thrown into doubt after they were referred to the UEFA Club Financial Control Body (CFCB) for allegedly breaching financial fair play (FFP) regulations for a second successive term.

Milan are fourth in Serie A, and close to returning to the Champions League for the first time since 2014, but could now face a ban from European competition.

They had claimed their financial situation would improve under the ownership of American hedge fund Elliott Management Corporation, after they assumed control of the club from former owner Li Yonghong last summer.

UEFA initially gave Milan a two-year ban from European competition for breaking FFP rules last summer but they successfully appealed against that sanction with the Court of Arbitration for Sport.

"The UEFA Club Financial Control Body investigatory chamber has today communicated its decision to refer the case of AC Milan to the CFC adjudicatory chamber as the club has failed to comply with the break-even requirement during the monitoring period assessed in the current season and covering the 2015-16, 2016-17 and 2017-18 seasons," a UEFA statement read.

"UEFA will be making no further comments on the matter until a decision has been reached by the CFCB adjudicatory chamber in this case. This referral is not related to the decision that was made by the CFCB adjudicatory in December 2018 and was covering the 2014-15, 2015-16 and 2016-17 seasons."

Under FFP regulations, clubs are not allowed to make losses of more than £26 million over three seasons, a cap Milan were accused of breaching between 2015-17 when they spent £200m on transfers. However, this referral is in relation to the three-year period between 2016-18.

The Rossoneri, who appointed former Arsenal chief executive Ivan Gazidis as CEO in December, were fined in January following the €35m signing of Paqueta.

"After the signing of Paqueta, a letter arrived from UEFA where we were asked about any similar investments -- along with a fine," sporting director Leonardo said in December.