Manchester City has taken legal action against the Premier League, alleging discrimination and seeking to end the league’s associated party transaction (APT) rules. The recently crowned champions are claiming that the rules are unlawful and are looking to seek damages. This move could have far-reaching consequences for the English top flight, as the dispute between City and the Premier League will be settled after a two-week arbitration hearing starting next Monday. The Premier League tightened rules regarding APTs in February, requiring clubs to prove that commercial deals represent fair market value.
City’s rapid rise to dominance in English football over the past decade has been aided by sponsorship deals with related parties in the Gulf, including Abu Dhabi-based Etihad Airways, which is both the club’s stadium and shirt sponsor. The club, managed by Pep Guardiola, is also facing 115 Premier League charges for alleged breaches of regulations and financial rules between 2009 and 2023, which they strongly deny. If City are successful in their legal fight against the Premier League, it could enable the wealthiest clubs to value their sponsorship deals without independent assessment, further widening the financial gap within the English top flight.
The Times report mentioned that City has accused rival teams of discrimination against Gulf ownership, citing the comments of a senior club executive. The club is suing the Premier League for damages, referring to losses incurred as a result of the existing rules that they claim were imposed at the instigation of rival clubs reacting to the Saudi takeover of Newcastle in 2021. This move by City is seen as an attempt to safeguard their own commercial advantages and challenge the current rules that are seen as hindering their success on the pitch. The Times also reported that between 10 and 12 clubs have come forward in support of the Premier League’s defense against City’s claim, providing either witness statements or letters detailing evidence.
The APT rules in the Premier League are designed to keep the competition fair and competitive, requiring clubs to maintain commercial deals that represent fair market value. Any changes to Premier League rules or major broadcast and commercial proposals require the approval of at least two-thirds of the clubs, or 14 out of the 20 clubs. City’s legal action against the Premier League could potentially change the landscape of English football by allowing the richest clubs to assess the value of their sponsorship deals without independent scrutiny. This move by City has been seen as challenging the existing norms within the Premier League and could potentially widen the financial divide within the top flight.
City’s dominance in English football has been unparalleled in recent years, with the club winning four straight Premier League titles. Their success has been supported by lucrative sponsorship deals with companies related to their owners in the Gulf. The club’s dispute with the Premier League over the APT rules and their legal action against the league could have significant implications for the future of English football, as it raises questions about fairness, competition, and financial equality within the league. City’s move to challenge the existing rules has sparked debate and speculation about the potential impact on the Premier League and its clubs, with the outcome of the arbitration hearing next week eagerly awaited.
