Manchester City v Premier League Round 1: Who actually won?
On Monday, the verdict of Manchester City and the Premier League's legal dispute of Associated Party Transaction (APT) rules was released. Both parties claimed resounding victories and their PR machines were in full swing to try and garner the support of football fans who may not have been as informed on the situation. Initially, it seemed that Manchester City's PR machine had painted the picture that they had won the case against the Premier League but after further digging, it came out that the Premier League had a case for victory too. So, how has this situation come about and who has actually won this battle?
Manchester City claim victory? Over 174 pages of the APT arbitration judgement it’s clear they lost much more than they wonhttps://t.co/O0oP0Qx1Cm
— Sam Wallace (@SamWallaceTel) October 8, 2024
This legal battle was born due to a dispute over the Premier League's APT rules, which covers commercial deals involving a club's owners. These rules were implemented in 2021, after the Saudi Public Investment Fund bought Newcastle United and there were fears that the new owners could record inflated sponsorship deals to fast track their progress and get to the top-tier level of football. So these rules were introduced to ensure that these commercial deals represented fair market value (FMV). Both Manchester City and the Premier League have claimed victory in this legal battle. Manchester City claims victory due to 2 aspects of the APT rules being found unlawful by the tribunal. The Premier League claims victory due to the fact that the tribunal rejected the majority of Manchester City's challenges.
Manchester City have made some really strong claims against the Premier League in the wake of the verdict. City claim that the APT rule were found to be "discriminatory... because they deliberately excluded shareholder loans". This feeling of being unfairly scrutinised may come from a sense of being harshly treated due to the nature of Manchester City's ownership and the success they've gained from being a club backed by a state. There is certainly a feeling that state-owned clubs are harshly scrutinised, especially from club owners who reside in the Gulf region. An argument in their favour is that the APT rules came into play to prevent Newcastle United gaining rapid success as a result of their new Saudi ownership and the Premier League wanting to avoid having another Manchester City-esque club in the league. In response to this, the Premier League have stated that the tribunal rejected this argument from Manchester City. But, there definitely is some substance to it in that the top clubs in the league are less open to new clubs reaching the top table of English football.
The funny thing about the APT rules is they weren’t really about Man City. They were much more about preventing Newcastle from doing what clubs consider to be a Man City.
— Adam Crafton (@AdamCrafton_) October 7, 2024
Since the verdict was shared, there have been further twists in this story. Manchester City sent a letter to the other 19 Premier League clubs in which they accused the Premier League of "misleading" clubs on the verdict of the legal case. In this letter, City claimed that the Premier League's statement on the verdict contained "several inaccuracies" and claim that City's legal action had "succeeded". This represents further tension between the two parties ahead of the 115 charges hearing that's set to happen this year. The Premier League clubs are meeting next Thursday to discuss the fallout of this legal battle. Potential rule changes will not be straightforward because some clubs are currently benefitting from shareholder loans at preferential interest rates (probably costing nothing). Therefore, a change in rules could mean that these clubs would incur additional costs and put a strain on their PSR records. If this were to happen, it is likely that the clubs footing these additional costs will seek compensation from the Premier League, which could open another can of worms.
So in Round 1 of what is to be a long and arduous battle between the Premier League and Manchester City, who has won? Whilst the Premier League have claimed victory on the basis of the majority of City's claims being rejected, I think that City may have the upper hand on this occasion. The repercussions of 2 aspects of the APT rules being unlawful could be significant, especially as this may affect the other Premier League clubs. We will see in the future if this outcome has any influence on the major case (115 charges) ahead of the 2 parties.
