Manchester City have accused the Premier League of “misleading” clubs over a legal judgement concerning top-flight rules on commercial deals.
City wrote to the other 19 clubs and the league on Monday night to challenge the league’s interpretation of the outcome and the four-in-a-row champions insisted their position was that all the associated party transaction (APT) rules were now void.
“Regrettably, the summary is misleading and contains several inaccuracies,” the club’s general counsel Simon Cliff wrote in an email seen by the PA news agency.
“Of even greater concern, however, is the Premier League’s suggestion that new APT rules should be passed within the next 10 days.
Club statement
— Manchester City (@ManCity) October 7, 2024
“When the Premier League consulted on and proposed the original APT Rules in late 2021, we pointed out that the process (which took several weeks) was rushed, ill-thought-out and would result in rules that were anti-competitive. The recent award has validated those concerns entirely.
“The tribunal has declared the APT rules to be unlawful. MCFC’s position is that this means that all of the APT rules are void, and have been since 2021.”
City launched a legal challenge to the APT rules earlier this year on the grounds that they breached competition law.
The APT rules are designed to ensure that commercial deals with entities linked to a club’s owners are done for fair market value and not artificially inflated.
City declared victory after the arbitration panel found the rules to be unlawful because they excluded shareholder loans.
Cliff told clubs it was “peculiar” that the league had said in its summary that City were unsuccessful in the majority of their challenge.
“While it is true that MCFC did not succeed with every point that it ran in its legal challenge, the club did not need to prove that the APT rules are unlawful for lots of different reasons. It is enough that they are unlawful for one reason. In the event, the tribunal found the APT rules are unlawful for three different sets of reasons,” Cliff wrote.
The league said changes to the rules arising from the tribunal judgement could be made “quickly and effectively” and is understood to have called a clubs meeting to discuss making those changes.
However, Cliff said this was not the time for a “kneejerk reaction” in revising the rules, which he warned could lead to further legal proceedings.
He said there needed to be “careful reflection” on how to proceed.
The Premier League declined to comment but stands by its summary, and rejects any assertion that it was either inaccurate or misleading.
Sources close to the league also stressed that the clubs meeting called for next Thursday will simply be an opportunity to discuss the rules, and that no votes on amendments to the rules will be taken.
The league’s summary said the tribunal ruling had “endorsed the overall objectives, framework and decision-making of the APT system” and only found “discrete elements” of the rules to be unlawful, which could be “quickly and effectively remedied” by clubs.
“Manchester City brought a wholesale challenge to the legality, design, framework and implementation of the APT rules,” the summary read.
“The club was unsuccessful in the majority of its challenge. Significantly, the Tribunal determined that the APT rules are necessary, pursued a legitimate objective and were put in place to ensure that the Profitability and Sustainability Rules (PSR) are effective, thereby supporting and delivering sporting integrity and sustainability in the Premier League.”
As well as finding the rules unlawful because of the exclusion of shareholder loans, the tribunal also found them unlawful because they were procedurally unfair, in that clubs are unable to comment on the data the league relies upon when it makes decisions about whether a deal has been done for fair market value.
Decisions made by the Premier League board on the value of sponsorship deals with Etihad Airways and First Abu Dhabi Bank were also set aside by the tribunal on the grounds that City were unable to see, or respond to, the data used in making those decisions, prior to the decisions being relayed to the club.
