ROME, July 4: Champions Juventus should be relegated to the third division and three other top clubs thrown out of Italian soccer's top league, the prosecutor in a sports match-fixing trial said on Tuesday.

Stefano Palazzi told the tribunal that AC Milan, Lazio and Fiorentina should be despatched to Italy's second division, Serie B, and Juve also stripped of the Serie A titles they won in the last two seasons.

The prosecutor's demands are more severe than expected and came just hours before Italy were due to play World Cup hosts Germany in the semi-final in Dortmund.

Juve are at the centre of Italy's biggest sporting trial after phone taps revealed one of its top managers discussing referee appointments with officials. Palazzi said Juventus should be relegated to “below Serie B”.

The prospect of Italy's most successful team plummeting into the also-rans of soccer sent a shiver through investors and the Milan stock exchange suspended Juve's shares.

In another blow, Juventus said coach Fabio Capello had resigned. Real Madrid president Ramon Calderon said on Monday he would appoint Capello, one of Italian soccer's most successful managers, as coach to the Spanish giants.

Juve stock was indicated down almost 14 percent soon after the trial news broke. Shares were indicated down 3.72 percent at 1.29 euros at 1200 GMT.

Eight of the players likely to be in Italy's opening 11 against Germany are from teams standing trial. Juventus has five players in the Italy squad and three playing for France.

Former Prime Minister Silvio Berlusconi, the billionaire who owns AC Milan, said he was “indignant” at the prosecutor's request to relegate his club and said Milan should be handed Juve's last two titles if the Turin team were found guilty.

“Milan have never had refereeing favours, on the contrary, they've been victims of refereeing favours in favour of other clubs,” he said.

After two days of procedural wrangling, the sports trial at Rome's Olympic stadium began in earnest on Tuesday with some of the 26 defendants personally pleading their case.—Reuters