Last week, in a landmark judgement, an arbitration panel consisting of three former judges, including a former Master of the Rolls, ruled in favour of the latest Manchester City challenge against the Premier League’s Associated Party Transaction (APT) Rules, providing a modicum of succour in the wake of their early Champions League exit at the hands of Real Madrid.
Whilst whooping cackles of delight from those with an anti-Premier League agenda, such as The Times columnist Martin Samuel, would suggest otherwise, the earlier City challenge to the APT rules, heard last Autumn, was inconclusive. Although the panel did not object to the general premise of the rules, restricting losses to £115m within three years, it declared, amongst other things, the exclusion of shareholder loans from the scope of the rules, which City wished to exploit through their Emirati owners, was in breach of Competition Law and consequently unlawful.
Nevertheless, despite overeager proclamations of certain journalists, the Premier League attempted to deal with the panel’s criticisms of the existing rules, by quite literally crossing out the offending provisions. However, Manchester City successfully persuaded the panel that simply crossing out the provisions pertaining to shareholder loans went against legal precedent and was therefore unlawful. The panel’s judgement, decrying the amendment of the existing APT rules, can only now be considered a significant victory for Manchester City.
This saga, however, is far from finished. In November, in response to the panel’s earlier verdict, the Premier League implemented yet further regulations to restrict the financial oligopoly the wealthiest clubs, including City, have on the game. Unsurprisingly, City have already lodged an appeal – which will be heard by the same panel later this year.
It is evident these legal challenges, alongside the separately long anticipated verdict on the 115 charges and the nascent, now aborted, Super League, are part of a wider footballing war between the regulatory authority and the free market. The colossal financial stakes of the case are highlighted by the instruction of Slaughter and May, and Freshfields, two of the pre-eminent law firms in the UK, by the Premier League and Manchester City respectively. This certainly underlines how, in the coming years, some of the most consequential sporting battles will occur in the courtroom rather than on the pitch.
“Manchester city etihad stadium (cropped)” by Arne Müseler is licensed under CC BY-SA 3.0.