Manchester City are claiming a victory over the Premier League following a partially successful legal challenge against Associated Party Transaction (APT) Rules.
The regulations aim to stop clubs from unfairly benefitting from commercial deals, or a reduction in costs, not at a fair market value made possible by relationships with ‘Associated Parties’.
APT rules were formalised in response to the Saudi Arabia-backed takeover of Newcastle United in 2021 so as to stop the Magpies profiting unfairly from potential deals with companies linked to their new owners. In the context of Manchester City, that could be firms with particular ties to owner Sheikh Mansour, whose late brother and former Abu Dhabi ruler founded Etihad Airways.
Sheikh Mansour himself is a royal family member, the current vice-president and deputy prime minister of Abu Dhabi, as well as chairman of two sovereign wealth funds and the central bank.
In June, City launched a legal challenge, which is separate to the 115 Premier League charges hanging over them, claiming APT rules to be unlawful. The complaint focused on potential sponsorship agreements with the Etihad Aviation Group – Etihad Airways’ parent company, the First Abu Dhabi Bank (FAB), whose chairman is another of Sheikh Mansour’s brothers, and Emirates Palace, a luxury hotel managed by a Hong Kong-based firm but owned by the Abu Dhabi government.
Now that an Arbitration Panel has presided over the case, the Premier League decisions blocking proposed City sponsorship transactions with Etihad and FAB have been set aside. The Premier League was also found to have broken its own rules due to the length of time taken to reach a decision on the FAB and Emirates Palace proposals.
Statements from Manchester City and the Premier League focus on different aspects of the tribunal.
City paint a picture of victory over tyranny, listing in bullet point format the Premier League’s failings, including an apparent abuse of its position, violation of UK law and discriminatory operations.
The Premier League noted that the tribunal “upheld the need for the APT system as a whole and rejected the majority of Manchester City’s challenges” and that a “small number of discrete elements” which do not currently comply with law can “quickly and effectively be remedied”.
Although there has already been media reporting on how Manchester City have “inflicted a potentially damaging defeat on the Premier League”, exactly how the league responds and what tweaks are made to APT regulations, which don’t appear to be going away, is crucial. What it doesn’t represent is a green light for clubs with the opportunity to now construct and inflate whatever deals they want.
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