Premier League champions Manchester City have initiated a legal dispute against the Premier League to challenge the league's Associated Party Transaction (APT) rules. This unusual action will be resolved through a private arbitration hearing set to commence next week. The APT rules were implemented in 2021 to stop clubs from artificially inflating sponsorship agreements with businesses connected to their owners, thus promoting fair competition.
In an extraordinary legal action that could potentially undercut the Premier League's 115 allegations against the champions, City claims they are the victims of "discrimination" from rival clubs. They contend that the right to freely determine sponsorship rates should belong to sponsors, such as those with connections to their ownership in Abu Dhabi. They believe the Premier League’s current system, which requires independent valuation for such deals, restricts their ability to raise revenue.
Rival clubs, meanwhile, feel that a Premier League loss in the historic case next week will ultimately result in the elimination of any significant financial regulations in the league, destroying its competitiveness in the process. They contend that it would circumvent the Profit and Sustainability Rules by enabling extremely wealthy owners to spend an infinite amount on infrastructure and players.
This lawsuit could impact Man City’s separate hearing in November concerning 115 alleged breaches of financial regulations.
