Manchester City triumph in legal dispute against Premier League
Manchester City have won a legal battle against the Premier League, over commercial regulations and two major sponsorship deals. The club had earlier been barred from completing these deals. An independent panel ruled that the Premier League's rules on commercial agreements between clubs and associated parties, breached competition law in two particular areas. Here's more on this.
Panel supports city's stance on shareholder loans
The panel backed Manchester City's challenge against 25 rules in the Premier League's handbook, concerning Associated Party Transactions (APTs), and its decision to reject two sponsorship deals. It concurred with City that shareholder loans, where shareholders or 'associated parties' lend money to the clubs they own, shouldn't be excluded from these rules. The club disclosed that such loans total around £1.5 billion across the division, including all of Arsenal and most of Brighton's borrowing.
Panel rules updated APT rules as unlawful
The panel agreed with City's argument that a revised version of the APT rules, introduced in February this year, was illegal because of the change in wording. The changes tightened the definition of what 'fair market value' means in commercial agreements. The two sponsorship deals with First Abu Dhabi Bank and Etihad Aviation Group were unfairly blocked, the panel found.
Premier League's decision-making process criticized
The panel also criticized the Premier League for not giving City all the information it relied on in its decisions in time for them to respond. It also found that the Premier League, which admitted to being understaffed at the time, took several months longer than necessary to reach its decision in both cases. However, City's other claims against the Premier League were dismissed by the panel.
Premier League and City respond to tribunal's findings
The Premier League has accepted the tribunal's findings, saying they "endorsed the overall objectives, framework and decision-making of the APT system." However, it accepted that some aspects of the rules do not meet competition and public law requirements. Manchester City thanked the panel for its findings, accusing the Premier League of having "abused its dominant position" with its approach and rules.
