Manchester City Takes Legal Action Against Premier League Over Financial Regulations
Manchester City has initiated legal proceedings against the Premier League, seeking to overturn the Associated Party Transaction (ATP) rules that govern commercial and sponsorship deals linked to club owners. The Times revealed that City is challenging the legality of these regulations, which require independent assessment of transactions to ensure they reflect fair market value.
According to The Times’ Matt Lawton, a 165-page legal document from City claims the ATP rules are “unlawful” and have led to lost revenue, thus discriminating against the club. These rules were introduced in December 2021 following the Saudi Arabian Public Investment Fund’s acquisition of Newcastle United.
The legal battle is set for a two-week arbitration hearing starting June 10. Sky Sports News has reached out to both the Premier League and Manchester City for comments.
Impact on Premier League’s Competitive Balance
Sky Sports News chief reporter Kaveh Solhekol highlighted the unprecedented nature of the case, noting that City, as the reigning Premier League champions, are effectively suing the league. Solhekol explained that City will argue the ATP rules are incompatible with UK competition law. These rules were designed to ensure that sponsorship deals involving companies linked to club owners are assessed for fair value by independent auditors.
“This could have significant ramifications for the future competitive balance of the Premier League,” Solhekol noted.
Connection to Existing Financial Fair Play Charges
This legal action comes amid Manchester City’s ongoing battle against 115 charges of breaching financial fair play rules, dating from 2009 to 2018. The Premier League alleges that City did not fully disclose financial remunerations to a manager over a four-year period and failed to comply with UEFA’s financial fair play regulations for five years. Additionally, City is accused of not fully cooperating with the Premier League’s investigation.
The Times reports that the hearing for these 115 breaches is scheduled for November, with City denying all charges. Solhekol pointed out that a victory for City in the ATP rules case could undermine the Premier League’s position in the November hearing, particularly regarding sponsorship deals involving entities connected to City’s owners.
“If Man City wins this case, it could significantly weaken the Premier League’s case in November, as it would demonstrate that some of these rules are unlawful and incompatible with UK competition law,” Solhekol added.
As the arbitration hearing approaches, the outcome could reshape the regulatory landscape for Premier League clubs and their financial dealings.
