The Premier League has recently amended its Associated Party Transaction (APT) regulations following a vote by its clubs, a development that comes on the heels of Manchester City’s legal challenge against these rules. The APT regulations pertain to sponsorship arrangements involving clubs and companies with potential affiliations, such as Manchester City and the Etihad Aviation Group, owned by the United Arab Emirates.
Earlier this year, Manchester City initiated legal proceedings against the Premier League, claiming the APT rules were “unlawful” and exhibited bias against Gulf ownership. An Arbitration Panel ruled last month, determining that while the APT framework is essential for the competition, certain components were indeed unlawful and necessitated revision.
Following a consultation period involving input from expert counsel and club representatives, the Premier League announced on Friday that they had made the necessary changes. These updates include the integration of assessments on shareholder loans, the removal of earlier amendments to the APT rules, and a revision of how information from the League’s databank is relayed to club advisors.
The core aim of the updated APT regulations is to prevent clubs from benefiting from sponsorship deals or cost reductions that do not reflect Fair Market Value (FMV), thereby helping to maintain the financial stability and competitive balance of the league. Notably, these amendments do not relate to the ongoing investigation into 115 charges against Manchester City for purportedly breaching financial regulations.
Going forward, any shareholder loans issued after the implementation of these new regulations must now be classified as APTs and will require FMV assessments. Should the Premier League Board determine that a loan is not at FMV, the club is obliged to either amend or terminate the loan to align with FMV standards and settle any interest deficiencies.
In summary, this development indicates the Premier League’s commitment to ensuring fairness and transparency in its financial dealings. By addressing concerns and improving the regulatory framework, the league may foster a healthier competitive environment, ultimately enhancing the integrity of football as a whole. This positive outcome reflects a willingness to evolve and adapt to the complexities of modern football ownership.