The Premier League side won their appeal against the suspension for alleged breaches of UEFA’s Financial Fair Play rules, while their fine was lowered to €10 million (£9m/$12m).
Hoeness says CAS’s decision was a severe blow to UEFA’s rules and criticised the governing body’s defence of the sentence.
“When I read the reasoning by the international sports court CAS why it withdrew this sentence, I have to ask myself what all this is about,” Hoeness said to DAZN and Goal.
“Ultimately, UEFA's reasoning was simply weak. In principle, the CAS saw it the same way, but did not provide any solid evidence of Manchester City's behaviour.
“If the judges at CAS have come to the conclusion that UEFA did a poor job, one need not wonder what the result is. The verdict was a clear slap in the face for UEFA. We still have to do with Manchester City - and the club can't help it if things are poorly prepared.”
Bayern will conclude their Champions League last-16 tie against Chelsea when they host Frank Lampard’s team for the second leg on Saturday.
The Munich outfit hold a 3-0 aggregate lead from the first leg and Hoeness was heavily impressed by their display in London.
“The first leg against Chelsea was incredible," he said. "I was there myself and have rarely seen a German team put an English team against the wall like that.
“The game was a demonstration of strength from the first to the last minute.
“Our team made a very hungry impression and there is also harmony within the group. All players work well together.
“The coach managed to improve the team's strengths and make the team a unit. You can see the meticulousness and passion with which they play until the last minute. The players have played an incredible season.”
He is also confident of the side’s ability to challenge Europe’s richer teams for the top trophies, saying success depends on team spirit and cohesion instead of money.
“There is also passion and a thirst for success in Manchester and Paris, but here a large community has emerged,” he added.
“This has nothing to do with the different countries, but is due to the cooperation between the team and the coach.”