Man City hit out at 'unlawful' new Premier League rules and raise possible legal action as letter to 19 other clubs is leaked

According to the Daily Mail,the Premier League champions have sent an 11-page letter to other top-flight clubs explaining their reasons for opposing the proposed amendments in the Premier League’s sponsorship regulations. In September, an independent tribunal ruled that certain Premier League rules, including the exclusion of shareholder loans from the FMV test, were unlawful. These loans are provided by individuals or entities holding more than a five per cent stake in clubs. Following this ruling, Premier League chief executive Richard Masters assured clubs that necessary amendments could be swiftly implemented.

However, City’s legal counsel, Simon Cliff, has openly challenged Masters’ assertions, accusing him of misleading clubs about the feasibility of amending the rules. The proposed changes would introduce a retrospective exemption for shareholder loans covering the period from December 2021 until the new rules take effect. City argue that this approach is illegal because the recent arbitration already declared such exemptions unlawful.

They further contend that allowing some clubs to benefit from shareholder loans while others did not is inherently unfair. Finally, he criticises the Premier League for allegedly hastening the amendment process. Cliff underlines the importance of waiting for the tribunal’s final verdict before proceeding with any voting for changes. He warns that the tribunal may rule all Advanced Profitability and Sustainability (APT) rules void, questioning how clubs can "meaningfully discuss amendments to rules without knowing if those very rules even exist?"

According to Daily Mail, Cliff has argued that City are "strongly in favour of robust, effective and lawful regulation of related party transactions. (But) common sense dictates that the PL should not rush into passing amendments – particularly ones which entail material legal risk – until the PL knows the outcome from the Tribunal."

Previously, the Premier League had pushed back against City’s claims in a strongly worded rebuttal. The league believes the club is making “repeated and baseless assertions” and insisted that its actions comply with regulatory obligations. They dismissed City’s accusations of misleading clubs and called their threats of legal action “meritless.” It further states, “That MCFC does not agree with the process does not provide a credible basis to impugn it.”

This escalating conflict underscores the growing divide between City and the Premier League over financial governance. City have long been vocal critics of the league’s regulatory processes, and its latest challenge could set the stage for a protracted legal battle. The proposed amendments allegedly aim to bring greater clarity and equity to the league’s financial rules, but City’s opposition raises questions about the feasibility of consensus among clubs. As the deadline for the vote looms, all eyes will be on next week’s meeting to see whether the Premier League can push through its changes or if City’s resistance will derail the process.