Manchester City Loses Premier League Vote on Financial Rules

Manchester City has faced another setback in its ongoing clash with the Premier League over financial regulations.

At a meeting in London, the required 14 clubs voted to approve changes to the Associated Party Transactions (APT) rules, rejecting City’s legal objections.

The Rule Changes

The amended rules focus on ensuring that deals with entities linked to club ownership are valued at fair market rates. Key adjustments include:

1. Fair Market Value Assessments: Sponsorship and shareholder loans must be evaluated for compliance with competition law.
2. Profitability and Sustainability Assessments: Shareholder loans are now included in evaluations, which determine whether clubs adhere to the league's financial rules, including a cap of £105 million losses over a three-year period.

Failure to comply could result in points deductions or other penalties.

Four clubs—Manchester City, Newcastle United, Aston Villa, and Nottingham Forest—voted against the amendments. These teams, particularly City and Newcastle, rely heavily on sponsorship deals from entities tied to their ownership structures in Abu Dhabi and Saudi Arabia, respectively.

Despite opposing the changes, no representatives from these clubs spoke at the meeting.

The new regulations aim to address concerns about financial stability and fair competition. By preventing clubs from inflating income through artificially high sponsorship deals, the league hopes to create a level playing field.

However, the rules will have the greatest impact on clubs with ownership models tied to large state-backed financial networks. City and Newcastle, for example, could find it more challenging to meet profit and sustainability targets under the stricter guidelines.

Ongoing Legal Disputes

Manchester City has already indicated plans to challenge the newly implemented rules legally.

The club remains embroiled in a broader battle with the Premier League over 115 charges related to alleged financial breaches dating back to the 2009-10 season.

The amendments approved today stem from an Arbitration Tribunal ruling earlier this year, which found elements of the APT system unlawful after a case brought by City.

While City and Newcastle opposed the changes, representatives from Chelsea and Manchester United supported them.

Chelsea's James Bonington and Manchester United CEO Omar Berrada were the only speakers in favour. Ironically, Berrada previously worked at Manchester City, where he had advocated against similar reforms.

The Premier League emphasized the purpose of the APT rules in a public statement, saying:

"The purpose of the APT rules is to ensure clubs are not able to benefit from commercial deals or reductions in costs that are not at fair market value by virtue of relationships with associated parties. These rules safeguard financial stability, integrity, and competitive balance."

The league noted that the amendments followed extensive consultations and were supported by opinions from independent legal experts.

This vote marks another chapter in the Premier League's effort to tighten financial regulations and clamp down on potential abuses of ownership-linked funding.

While many clubs support the changes, the dissent from Manchester City and Newcastle highlights the ongoing tensions between traditional football models and state-backed mega-investors.

City's next steps, likely involving legal challenges, could set significant precedents for the future governance of financial fair play in English football.
Source: Sky news 
Image: Football London