PREMIER LEAGUE
Will Manchester City’s Premier League sponsorship victory affect their 115 charges investigation?
The English champions have landed another punch in their battle against the league they win every year.
Plucky little Manchester City have ducked, dived, dodged and weaved their way through the barrage of unfair Premier League punches and now landed a blow of their own, right on the nose. The world watches on as they are cheered through the crowds of applauding people in this David vs Goliath story.
I’ll explain: the Premier League, England’s top competition, had stopped the club from agreeing two mammoth sponsorship deals under the assumption that they had been inflated. Based on their Associated Party Transactions rules, the league said that City had breached the rules after lining up a deal with Etihad, the Abu Dhabi-based airline as well as another deal with an Abu Dhabi-based bank.
However, a group of top retired judges have today ruled that the Premier League’s ATP rules were actually unlawful and they were wrong halt City’s deals, which were all above board.
Manchester City's full statement:
Following today’s publication of the Rule X Arbitral Tribunal Award, Manchester City Football Club thanks the distinguished members of the Arbitral Tribunal for their work and considerations and welcomes their findings:
- The Club has succeeded with its claim: the Associated Party Transaction (APT) rules have been found to be unlawful and the Premier League’s decisions on two specific MCFC sponsorship transactions have been set aside
- The Tribunal found that both the original APT rules and the current, (amended) APT Rules violate UK competition law and violate the requirements of procedural fairness.
- The Premier League was found to have abused its dominant position.
- The Tribunal has determined both that the rules are structurally unfair and that the Premier League was specifically unfair in how it applied those rules to the Club in practice.
- The rules were found to be discriminatory in how they operate, because they deliberately excluded shareholder loans.
- As well as these general findings on legality, the Tribunal has set aside specific decisions of the Premier League to restate the fair market value of two transactions entered into by the Club.
- The tribunal held that the Premier League had reached the decisions in a procedurally unfair manner.
- The Tribunal also ruled that there was an unreasonable delay in the Premier League’s fair market value assessment of two of the Club’s sponsorship transactions, and so the Premier League breached its own rules.
What effect will this ruling have on the Premier League?
In a word: no. This is a completely separate case and will not have any effect on the 115 charges that Manchester City are set to be investigated for regarding payments made to former employees.
What it might affect, however, is how the Premier League’s other clubs go about their business. Since the deals are now not classed as unlawful, this could open the door for City and others to hugely increase the numbers involved in sponsorship deals, if the rules do indeed get changed to reflect this ruling.
The club are expected to go after costs and damages while the League themselves are widely expected to have to change or get rid of their APTs system entirely. As well as this, clubs up and down the division could also seek damages i they believe they have been impacted.
City’s lawyers, in the case, argued that the rejection of the deals was ‘fearmongering’ that came in light of the Newcastle United takeover from Saudi Arabia and claimed that the rules were specifically aimed at Gulf-owned clubs. While the ruling does not affect the 115 charges, as mentioned, it is a big hit from City on the Premier League’s now bloodied nose.