Article;
Scousers will be furious
https://www.thetimes.com/sport/football/article/premier-league-manchester-city-apt-rules-trial-result-mzc65t0m7
Manchester City appear to have secured a potentially significant victory in their legal battle with the Premier League over the rules designed to limit how much associated parties can pay clubs in sponsorship.
As The Times revealed in June, City launched an unprecedented legal action against the league in a move that has sparked civil war in English football’s top flight.
A two-week private arbitration hearing that started on June 10 was focused on Associated Party Transaction (APT) rules, which City argued are unlawful and contrary to the Competition Act 1998.
Introduced in December 2021 in the wake of the Saudi-led takeover of Newcastle United, the rules were designed to maintain the competitiveness of the Premier League by preventing clubs from inflating commercial deals with companies linked to their owners. The rules dictate that such transactions have to be independently assessed to be of “fair market value”.
A central pillar of those new rules was a databank to which clubs are required to submit all commercial contracts, which in certain circumstances can be used to validate the value of such deals.
The Times understands the 20 Premier League clubs were due to vote on an amendment to rules specific to the database at the shareholders’ meeting in central London on Thursday. The clubs were to be asked to vote on restricting access to the databank. The vote would have meant regulatory commissions and arbitration panels could not have given access to individual clubs to use the databank to acquire commercial information about rival clubs.
However, the planned vote on the amendment was removed from the agenda late last night, even though more specific details of what the amendment regarded were not included.
According to sources, the “last minute” withdrawal is being interpreted as an indication that a City legal team, led by Lord Pannick KC, have certainly enjoyed some success in convincing an independent panel that the rules on sponsorship deals need to be changed.
Further to that, it may also suggest that it was deemed pointless making one amendment if an issue with the databank actually has wider implications for all the rules regarding APTs.
The development comes with the Premier League’s case against City for 115 alleged breaches of financial rules now in its second week. It remains to be seen how a change to APT rules could impact on the case concerning those alleged breaches, but many of the charges concern City’s sponsorship agreements. That ongoing hearing, which is expected to last ten weeks, could lead to huge fines for the club owners and possibly even relegation for Pep Guardiola’s all-conquering side.
As The Times reported in June, City submitted a 165-page legal document challenging the APT rules. The English champions argue that they are the victims of “discrimination”, describing rules they say have been approved by their rivals to stifle their success on the pitch as a “tyranny of the majority”.
Clubs feared that, should City be successful, it could enable the richest clubs to value their sponsorship deals without independent assessment, vastly boosting the amount of money they can raise and therefore giving them far greater sums to spend on players.
The Premier League have been approached for comment. A spokesperson for City said: “As you know, we are not in a position to comment.”
