Man City vs Premier League Q&A: What now after legal case over Associated Party Transaction rules?

Sky Sports News' lead reporter Kaveh Solhekol discusses the current situation following a partial win for Manchester City in their legal dispute with the Premier League regarding commercial rules...

Understanding Associated Party Transaction Rules

According to the rules of the Premier League, any club, along with its players, manager, or any high-ranking official, must disclose any transactions or interactions with related entities to the league.

'Associated parties' refer to individuals or organizations that have a considerable stake in the club, whether through financial investments or other forms of involvement.

The Premier League's board examines each deal to determine if it reflects a reasonable market value.

The league claims that this regulation promotes "fairness" throughout the division by reducing the "dependence on increased revenue from commercial activities associated with club ownership."

What Is Their Purpose?

It all began in 2021 when the Saudi Sovereign Wealth Fund acquired Newcastle.

In the realm of football, there was a lot of concern. Many believed that this acquisition would transform everything, allowing the new owners to secure massive sponsorship agreements to funnel cash into Newcastle. This, in turn, could pave the way for them to acquire star players like Kylian Mbappé, Neymar, and Cristiano Ronaldo, potentially disrupting the competitive balance of the Premier League.

What measures can clubs take to prevent this situation? They established ATP regulations to ensure that any agreements between a club and a business linked to its owners reflect fair market value.

How Will This Affect Man City's 115 Charges?

You might consider this a major win for Man City, especially since a hearing is currently taking place in central London regarding the club's purported violation of 115 financial regulations set by the Premier League.

By achieving this win, City has weakened the financial regulations of the Premier League.

They’ve got everyone wondering: “These financial regulations are meaningless; they were put together too hastily.”

They took on the challenge and succeeded, similar to Leicester City, which recently triumphed in a legal dispute regarding the financial regulations of the Premier League.

I don’t want to underestimate the importance of this decision. I believe it will have a major impact on the Premier League and its financial regulations.

Is Man City Treating This As A Major Win?

Man City is claiming they have emerged victorious, and this is an important win for the team.

They claim to have demonstrated that the rules are illegal, breach UK competition laws, and compromise fair procedures. Additionally, they assert that the Premier League has misused its dominant position and that the rules are biased in their application.

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Did The Premier League Find Success In This Ruling?

In general, the tribunal has supported the goals of the Associated Party Transaction (APT) regulations, along with the structure and decision-making approach that guide them.

The Premier League would state, "The tribunal has identified a few minor adjustments we need to implement - we'll promptly take care of those."

They would argue that the main point should be that the rules are remaining in place.

Which Clubs Are Taking Sides?

I'm really curious about the vibe at the upcoming Premier League shareholders' meeting. It's interesting to note that some clubs backed Man City while others sided with the Premier League.

Chelsea, Newcastle, and Everton observed what happened with Manchester City.

Arsenal, Manchester United, Liverpool, West Ham, Brentford, Bournemouth, Fulham, and Wolves submitted written statements backing the Premier League's stance.

This is a contentious topic.

Man City had two agreements they were trying to finalize with Etihad Aviation Group and First Abu Dhabi Bank, but those were prevented from going through. The tribunal has instructed the Premier League to re-evaluate those agreements.

In the future, City might consider taking legal action against the Premier League to seek compensation. They could argue that the agreements that have been blocked in the past have limited their ability to generate additional revenue for the club.

It will be fascinating to observe the consequences of the 115 supposed allegations...

Summary of the tribunal's conclusions...

What Did Man City Have To Say?

In a message posted on the City's website, they stated:

After today's announcement of the Rule X Arbitral Tribunal Award, Manchester City Football Club expresses gratitude to the esteemed members of the Tribunal for their efforts and insights, and they appreciate the conclusions reached.

What's Happening In The Premier League?

As you might anticipate, the Premier League's announcement takes a different tone. They have stated:

The Premier League is pleased with the tribunal's conclusions, which supported the main goals, structure, and decision-making process of the APT system. The tribunal confirmed the importance of the APT system and dismissed most of Manchester City's objections. Additionally, the tribunal determined that these rules are essential for the League's financial regulations to function properly.

This decision marks a significant and thorough evaluation of the APT regulations. These rules are designed to prevent clubs from gaining advantages through commercial agreements or cost reductions that don’t reflect fair market value due to connections with affiliated parties. They were implemented to create a strong framework that protects the League's financial health, integrity, and competitive fairness.

The tribunal found a few specific parts of the rules that, as they stand now, don't meet the standards of competition and public law (details are provided below). The League and clubs can easily and promptly fix these issues.

In the meantime, the Premier League will keep using the current APT system while considering the conclusions reached by the tribunal.

Although the arbitration proceedings are private, the Premier League and the club have decided to release a version of the decision with certain sensitive details removed, keeping only confidential and commercially sensitive information private.