Manchester City Wins Partial Victory in Legal Battle with Premier League
Manchester City has secured a partial victory in its legal battle with the Premier League over Associated Party Transactions (APT), a set of rules designed to regulate commercial deals between clubs and their owners.
An independent arbitration panel ruled in City’s favour on two key points but upheld the overall structure of the Premier League's financial rules.
Tribunal decides parts of APT rules break UK law
The APT rules, introduced after Newcastle United’s takeover by Saudi Arabia’s Public Investment Fund in 2021, were created to prevent clubs from inflating sponsorship deals with companies tied to their owners.
The Premier League has faced criticism for inconsistencies in how these rules have been applied, with City being one of the loudest voices against them.
The tribunal determined that parts of the APT rules, including the exclusion of shareholder loans, broke British competition law and were "structurally unfair." The panel also found the Premier League's rejection of two City sponsorship deals with First Abu Dhabi Bank and Etihad Aviation Group to be “procedurally unfair.”
The decisions were deemed delayed and City was not given enough time to respond to the league's assessments.
Premier league states tribunal upheld most of their rules
However, the Premier League framed the outcome differently, noting that the panel had upheld most of its rules. The league stated the tribunal had endorsed the "overall objectives" of the APT system, and only two aspects were found unlawful.
It further added that these rules were essential to ensure fair competition and prevent inflated sponsorship values that could give clubs an unfair financial advantage.
City happy with ruling
City expressed satisfaction with the ruling, claiming that the Premier League had "abused its dominant position."
The club’s statement emphasised that the rules were found to be discriminatory, particularly because they excluded shareholder loans, which, according to the tribunal, distorted competition.
While City succeeded in having the rules surrounding shareholder loans overturned, the tribunal rejected most of the club's other challenges, including claims that the APT rules were designed to target clubs owned by Gulf-based companies.
The Premier League said it would swiftly amend the two rules that were deemed unlawful.
As City continues to navigate a separate case involving over 100 alleged financial breaches, this partial victory provides a small win in a much larger legal landscape. However, with a verdict on the financial breaches expected later this season, the club’s challenges with the Premier League are far from over.
