What Man City had to show in legal row after rivals’ move angered Amanda Staveley at Newcastle
Manchester City has embarked on a legal challenge that could significantly impact Newcastle United and other Premier League clubs.
The dispute revolves around the validity of the Premier League’s sponsorship rules, which were first introduced following Newcastle’s takeover in 2021.
The Premier League implemented associated party transaction (APT) rules to ensure that commercial deals with companies linked to club owners were independently assessed to confirm they were of fair market value.
These rules were designed to prevent clubs from inflating their revenues through deals with related entities, thereby gaining an unfair advantage.
Amanda Staveley, a key figure in Newcastle’s takeover by the Saudi Public Investment Fund (PIF), was notably frustrated by these regulations.
Staveley and her husband, Mehrdad Ghodoussi, have been instrumental in Newcastle’s commercial operations since the takeover.
She has publicly expressed her belief that these rules were introduced to limit Newcastle’s competitive edge and to safeguard the existing commercial advantages of rival clubs.
Manchester City’s Legal Argument
Manchester City contends that the APT rules are anti-competitive. In a detailed 165-page legal argument, the club argued that these rules were “deliberately intended to stifle commercial freedoms of particular clubs” and “restrict economic competition.”
Manchester City claims that these regulations were a direct response to Newcastle’s takeover, aimed at limiting the influence of Gulf-based ownership.
Legal experts from Mishcon de Reya Sports Group have provided insights into what Manchester City would need to prove in their legal challenge.
According to these experts, Manchester City must demonstrate that the APT rules are preventing, limiting, or restricting proper competition between clubs.
Specifically, they need to show that the rules have an “actual, appreciable negative effect on competition,” either by effect or by object.
The Premier League is expected to argue that the APT rules are necessary to protect legitimate interests, such as ensuring financial sustainability and competitive fairness among clubs.
This defense would emphasize that the rules are essential for maintaining a level playing field in the league.
The outcome of this legal challenge could have significant implications for Newcastle United. If Manchester City succeeds, it could lead to a relaxation of the APT rules, allowing Newcastle and other clubs to enter into more lucrative sponsorship deals with related entities.
This could boost Newcastle’s revenue streams and enhance their competitive standing in the league.
The verdict, expected this summer, could reshape the financial landscape of the Premier League.
A decision in favor of Manchester City might encourage other clubs to challenge similar regulations, potentially leading to a more relaxed approach to sponsorship deals.
Conversely, if the Premier League’s defense prevails, it would reinforce the existing framework aimed at maintaining financial and competitive integrity.
As the Premier League awaits the outcome of this arbitration hearing, clubs across the league are closely monitoring the situation. The private nature of the proceedings means the exact timing of the verdict’s publication remains uncertain.
However, the decision will undoubtedly have far-reaching consequences for the financial and competitive dynamics of the Premier League.
Manchester City’s legal challenge against the Premier League’s sponsorship rules is a high-stakes battle with significant implications for Newcastle United and the broader football community.
As clubs await the verdict, the potential for a reshaped financial landscape looms large, promising to impact the future of commercial dealings and competitive balance within the Premier League.
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