Manchester City launch new legal action against Premier League APT rules

Manchester City Football Club has once again launched a legal challenge against the English Premier League, directly targeting the league's new regulations regarding club sponsorship deals and claiming these regulations are "illegal." This move marks a new phase in the long-standing dispute between the two parties over financial fair play issues, potentially reshaping the landscape of club finances.

Previously, following a lawsuit initiated by Manchester City, an independent arbitration panel ruled that parts of the Premier League's Associated Party Transaction rules (APTs) were problematic. These rules are designed to prevent clubs from profiting through commercial transactions with companies related to their owners if these transactions are deemed to be above "fair market value." Despite opposition from Manchester City, the majority of Premier League clubs voted to approve amendments to the APTs in November of last year.

Premier League Chief Executive Richard Masters stated in a letter sent to clubs on Thursday: "On 20 January 2025, Manchester City Football Club commenced further arbitration challenging the APT rules… The new challenge concerns the APT rules as amended which were approved at a Shareholder Meeting on 22 November 2024." Manchester City seeks a declaration that the amendments approved in November (and therefore the current APTs rules in effect) are unlawful and invalid. The Premier League remains strongly of the view that the amendments passed in November are lawful and that the APTs rules are compliant with all competition law requirements.

Masters added: "We believe it is essential that the new arbitration is resolved as quickly as possible and, to that end, we agreed to appoint the same arbitration tribunal to hear the new case. The parties are currently in communication regarding further directions. The APT rules remain fully in force and clubs remain subject to all aspects of that regime." Last year, a tribunal ruled that low-interest shareholder loans should not be excluded from the scope of APTs, and that modifications made to strengthen these regulations also violated competition law.

Manchester City is also awaiting the outcome of a landmark disciplinary hearing, following allegations by the Premier League that the club has violated more than 100 financial rules. The club denies any wrongdoing. Furthermore, news of Manchester City's latest legal challenge comes less than a week before top clubs gather in London for their first shareholder meeting of 2025. Both Manchester City and the Premier League have declined to comment, leaving the future uncertain as the legal battle unfolds.