Manchester City and the Premier League have both claimed victory in the dispute over the league’s rules on commercial deals.
Here, the PA news agency tries to make sense of it all.
What is the background to this?
Earlier this year, City launched a legal challenge to the league’s associated party transaction (APT) rules on the grounds they breached UK competition law, and an arbitration panel was set up to consider the matter.
The APT rules are designed to ensure commercial deals involving entities linked to a club’s owners are done for fair market value.
On Monday, City and the Premier League each published the arbitration panel’s 175-page judgment, and drew very different conclusions from it.
What have City said?
City see this as a huge win, and in a statement said the panel had found the APT rules “unlawful”, “structurally unfair” and “discriminatory”.
They also pointed out that decisions made by the Premier League to block two transactions had been set aside after the panel found them to be procedurally unfair, because City were denied access to data used by the league in making its decision and because of unnecessary delays in the process.
What have the Premier League said?
The league said in a statement that City had failed in the “majority” of their challenge to the APT rules.
It said the two findings against it concerned the exclusion of shareholder loans from the rules, and the wording of some amendments made to the rules earlier this year.
“Otherwise, the Premier League rulebook has been found to comply with competition and public law standards and is an effective and necessary system for assessing the fair market value of associated party transactions to ensure the integrity of the league’s profitability and sustainability rules,” the league said.
The league said the panel had not disagreed with the league’s assessment of the value of the two City transactions that have been set aside, only that the league should have provided City with the comparable transaction data used to make the decisions prior to making it.
What did the panel say?
Its judgment talks about the APT rules being unlawful because of the exclusion of shareholder loans from consideration, “and for no other reason”.
It says the rules, as amended this year, are unlawful for the same reason, as well as due to pricing changes in the appendix to the new rules, “and for no other reason”.
It found both the old and amended rules “procedurally unfair” on the grounds that clubs cannot comment on comparable transaction data before it is used by the league to make decisions on whether deals are done at fair market value “and for no other reason”.
So who really did ‘win’?
Manchester City v The Premier League Today we have finally been able to read the written reasons in the MCFC v PL arbitration about the legality of the PL’s Associated Party Transaction Rules (‘APT’) and their application. As is often the case with lawyers, both sides have…
— Nick De Marco KC (@nickdemarco_) October 7, 2024
Leading sports lawyer Nick De Marco KC posted on X: “As is often the case with lawyers, both sides have declared victory. The truth is somewhere in between, with each side winning on different issues.
“The fact, however, that parts of the PL’s APT Rules have been declared unlawful is significant. Just a few days after the European Court found parts of FIFA’s RSTP were unlawful, and coming not long after the ESL case in Europe (finding FIFA and UEFA rules to be unlawful), and the decision of an FA Rule Arbitral Tribunal that The FIFA and FA’s cap on football agents fees was unlawful, the case represents another example of the increasing tendency of courts and tribunals to hold sports regulators to closer scrutiny than has previously been the case the – in particular where economic activity is involved and where issues of freedom of movement and competition law arise.
“In addition, some of MCFC’s ‘wins’ in the APT case were based on English public law principles of procedural fairness.”
What happens now?
The Premier League says the specific changes to the APT rules arising from the panel findings will “quickly and effectively” be enacted but the majority of the rules – and the principles underpinning them – will stay in place.
Any significant changes to, or relaxation of, the APT rules would have huge ramifications and make it easier for clubs with the wealthiest owners to strike deals linked to their ownership and in the process benefit from higher revenues, strengthening their position in regard to the league’s profitability and sustainability rules.
From City’s point of view, they say the ruling entitles them and other clubs to seek damages.
