Big win for Manchester City as Premier League's commercial deal rules declared 'void and unenforceable'

In a landmark ruling that shakes the foundations of English football, an arbitration panel has declared the Premier League's rules governing commercial deals for the period from 2021 to 2024 as "void and unenforceable."

This ruling emerged from a challenge brought forth by none other than reigning Premier League champions, Manchester City, who have been at the centre of discussions around the integrity of associated party transactions (APT).

The controversy dates back to last year when Manchester City lodged a lawsuit against the Premier League, contesting the legality of its APT regulations. These rules were designed to ensure that any deals conducted between clubs and entities linked to their ownership were conducted at fair market value.

However, in October, an arbitration panel ruled that three specific components of the APT regulations were unlawful, sparking a significant upheaval in football’s governance structure.

Initially, the Premier League interpreted the ruling as necessitating only minor amendments to the existing regulations, which were subsequently approved by member clubs in a vote one month later. However, Manchester City maintained that the entire set of APT rules was flawed and demanded that no hasty changes should be implemented without further clarity. This discord led both sides to seek additional clarification from the original arbitration panel.

The British media, including prominent news outlet the BBC, reported that the tribunal's declaration was unambiguous: “In the first partial final award, it was declared that the APT rules and amended APT rules were unlawful in three respects.”

"There now arises for decision the question whether those three respects can be severed from the remaining APT rules so that those remaining APT rules are valid and enforceable.

"The three respects in which the APT rules and amended APT rules were unlawful cannot be severed with the result that the APT rules as a whole are void and unenforceable."

The implications of this ruling are profound, as it not only undermines the efficacy of the Premier League's regulatory framework, but also raises questions about the future of commercial dealings within the league.

The Premier League’s attempts to introduce amended APT rules in February last year have now come under scrutiny, and Manchester City has since launched a new challenge against the revisions made in November 2024, with this matter currently under review by the same arbitration panel.

Looking forward, the panel acknowledged that there remains an impending decision regarding the validity and effectiveness of the November 2024 amended APT rules, a critical piece that could further reshape the relationship between Premier League clubs and their affiliated entities.

This ruling has turbocharged the ongoing debate about transparency and equity in football’s financial landscape, with many observers now calling for more rigorous oversight and governance within the league.

As Manchester City's legal battles continue, the Premier League stands at a crossroads, needing to reassess its governance strategies or risk further legal challenges that could disrupt the league’s operations.

Additional reporting by AFP

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