Premier League owners met for the first time this season on Thursday with champions Manchester City locked in two legal disputes with the league.
The meeting in central London ended with no update on Manchester City’s legal challenge against Associated Party Transaction (APT) rules, which govern commercial deals with entities linked to club owners.
Some clubs had expected to hear about any ruling, but league sources and several club representatives attending said the matter was not discussed at the two-hour meeting.
And, because this relates to a confidential arbitration process, there may not be a formal announcement, even if a ruling has been reached.
Separately, a number of undisclosed proposed rule changes – including one concerning the Premier League’s ‘databank’ – which clubs have to submit commercial information to – and which is one of the ways that the league’s board assesses deals for fair market value – were dropped after feedback from clubs.
The league’s legal costs last season – which spiralled to more than £45m as a result of fighting a spate of disputes over financial rules – were discussed, with some clubs questioning the costs. The league feels this is the result of unprecedented legal action and a need to uphold its rules.
Clubs were also told that testing for semi-automated offside technology is continuing, and may now not be brought in until the new year.
BBC Sport breaks down what happened at the meeting…
Why was Thursday’s meeting significant?
A really interesting thing happened before the meeting when BBC Sport discovered the Premier League had withdrawn an amendment to its rules that was due to be voted on by the top-flight clubs.
The amendment concerned issues around allowable access to sensitive information stored in the league’s ‘databank’ in the event of a challenge to a ‘determination’ (ruling) by the Premier League board.
A Premier League source told BBC Sport that a number of rules intended to be put to their 20 member clubs at the meeting would not be happening because of what was described as “various amounts of club feedback”.
The league refused to say whether this was related to its arbitration hearing with Manchester City around its Associated Party Transaction (ATP) rules, which took place earlier in the summer.
What are APTs?
APTs are commercial deals involving a club and companies they have close ties to.
The Premier League has the right to assess the value of such deals to ensure they have not been inflated, which could give clubs more to spend under current financial rules.
What is the APT case?
It had been felt that Manchester City’s challenge to the Premier League was that they wanted to scrap Associated Party Transaction rules completely.
But from talking to sources with an understanding of City’s motivations, BBC Sport has learned the club’s argument was not against what they deem to be proportionate and fair regulation.
In this instance, what they actually argued against were the changes. City argued the initial rules, in place up to 2021, were fine. The club did not believe there had ever been an indication of a need to change those rules, and no proposal to do so had been put forward.
It is also worth bearing in mind that under these rules, all City’s partnership deals had been annually reviewed and none were considered to be related party transactions.
So, their conclusion was that the changes – which they believe were rushed anyway considering the complexity of the arguments – came about as a result of club politics.
The rules were changed following a vote in February that was not unanimous.
Last November plans to block loan deals between associated clubs and also wider commercial transactions both fell short of gaining the required two-thirds majority.
This confirmed to City the plans were wrong, and would lead to substantial argument and legal bills on both sides. They felt the new rules would be used to target certain clubs.
They also question that if 14 clubs – or in this instance 12 given two abstained – can effectively change the economics of rival clubs, what would stop them doing so in an even clearer way by, say, centralising commercial contracts, as is the case in Major League Soccer.
This last argument does appear a bit of a stretch, nevertheless, it is what City felt and the argument they made.
So what does it mean?
It is generally accepted removing the amendment to be voted on at the meeting was significant.
But no-one can be clear exactly why, or whether it indicates good news for the Premier League or City.
A league source said that because it was an arbitration hearing they could not say whether there has been a resolution.
A City spokesperson said: “We are not in a position to comment at this time.”
Lawyer Nick de Marco KC – who acted on behalf of Leicester City when they successfully appealed against an alleged breach of the league’s Profit and Sustainability rules last month – says there needs to be more transparency over such cases. “Everyone is now speculating about the alleged outcome of the MCFC v PL Rule X arbitration, and who might have won what,” he wrote on X.
“But nobody can know what the result is (if indeed there has been one) or how it was reached, because the Premier League cling on to absolute secrecy.
“It does their reputation no good at all, at a time the government is considering the powers of a new independent football regulator, to keep such important matters of football regulation, that affect the whole competition, secret. If there is a decision of the very learned panel, it should now be published.”
How much have clubs spent on legal fees?
The Premier League spent £45m on legal fees fighting its various disciplinary cases last season.
The legal costs are the result of a) an unprecedented number of recent investigations, disciplinary commission processes, appeals and arbitrations over disputes with clubs related to financial regulations, and b) hiring some of the country’s top lawyers that charge about £1,000 per hour.
They include cases involving Manchester City, Everton, Nottingham Forest, Leicester City and Chelsea.
It was recently revealed that the league had to cover more than £3m of the legal costs that arose from the case that saw Everton docked points for breaching Profit and Sustainability rules (PSR).
Although it is technically the clubs’ money being used to pay the bill, it doesn’t come directly from the clubs themselves.
Each season, the Premier League keeps an amount of money back that could be used for various reasons, legal issues being one of them. It doesn’t impact on the prize money and broadcast payments that are written into league rules.
At the end of each season, any funds remaining after the various bills have been paid are distributed as a ‘wash-up’ payment.
It is this distribution that will be affected. Whatever is paid goes down as income for Profit and Sustainability reasons, but that is true of any other payment from central Premier League sources.
Why does that matter?
Legal fees are by their nature expensive. The amount being spent by the Premier League to fight Manchester City over their 115 charges will be huge, almost certainly running into the tens of millions given the complexity of the case.
This only becomes an issue if the clubs decide the costs are too high, the negatives outweigh the potential benefits, and urge the whole matter to be brought to a conclusion.
Any Premier League vote requires a two-thirds majority. There is no indication yet the clubs have reached that point.
Some clubs are known to be concerned that so much money is being spent on legal battles, and will reduce their share of central broadcast deal funds.
League chiefs reportedly budgeted for £8m legal costs last season, rather than the £45m they reached. Questions on the issue were asked at Thursday’s meeting.
However, league sources point out the costs are a fraction of the billions of pounds that it generates, and it is crucial that it upholds rules to preserve the integrity of the league.
However, there has also been speculation that if legal costs continue to spiral, they could potentially make it more likely that the Premier League eventually seeks a settlement with Manchester City over its long-running dispute surrounding the 100-plus charges for alleged financial rule breaches. Especially with the possibility of appeals in the future.
How have the charges and APT issue affected club relationships?
While City deny wrongdoing, it is inevitable that the gravity and scale of the 100-plus Premier League charges they face for alleged financial rule breaches across 14 seasons will have affected their relationship with some rivals – especially those that may feel they have lost out on titles or European qualification if City are found to have broken financial rules by artificially inflating sponsorship revenue.
The tensions were clear when manager Pep Guardiola recently said he believed other clubs “want us to be sanctioned”.
Javier Tebas, president of Spain’s La Liga, also said he has spoken to many Premier League clubs who want to see the current champions punished.
However, there is also some sympathy for City when it comes to their legal challenge over APT rules. When they were introduced in 2021, only Saudi-owned Newcastle United voted against them, while City abstained.
When the rules were then toughened up earlier this year, they proved even more divisive. Fourteen clubs voted for the changes, with six voting against (Aston Villa, Chelsea, Nottingham Forest and Sheffield Utd reportedly joined City and Newcastle in opposing them), while two other clubs – reported to be Crystal Palace and Burnley – abstained.
Some rivals are known to be troubled by City’s subsequent legal fight, fearing that if they win and the rules are changed, it could remove a crucial means of curbing the spending power of Middle Eastern-owned clubs, and those which are part of multi-club groups.
But others seem to share City’s view that there is too much regulation and that it could stymie investment.