Man City accused of trying to run Premier League themselves by rival clubs

Manchester City have been accused by rivals of trying to run the Premier League themselves after they dismissed the league’s view on the verdict from the major tribunal between the two – and advised clubs to contact them rather than the league executive.

In an email sent by the club to all 19 rivals, City dismissed the Premier League’s summary of the tribunal’s findings, claimed that the entirety of the league’s associated party transaction [APT] rules were now obsolete, and invited other clubs to speak to them directly.

The letter has caused consternation among clubs who feel that City are now explicitly ignoring the leadership of the Premier League, and seeking to have clubs bypass them. One source told Telegraph Sport that the situation was unprecedented and that City – also fighting a separate suite of around 130 Premier League charges – were now in open revolt.

In the email, City’s general counsel Simon Cliff accused the Premier League of “misleading” clubs with “inaccuracies” in its summary of the arbitration tribunal finding that ruled last month on City’s challenge to APT rules – critical to financial controls.

Cliff told the clubs to ignore the advice from the Premier League’s counsel and to assume that all APT rules are now invalid. He wrote: “MCFC’s position is that this means that all of the APT rules are void, and have been since 2021.” He said clubs should reject any “knee-jerk reaction” from the Premier League to amend the APT rules. He added that City would be “happy to assist” with any enquiries from their 19 fellow members.

City lawyer caused ‘tumbleweed moment’

The email was met with disbelief at many clubs who have already discussed with the Premier League the advice of its counsel Kevin Plumb. The view of Plumb and his chief executive Richard Masters, as outlined to clubs when the judgement was published on Monday, is that while the ATP rules require some amendments, the tribunal found its basic legal structure to be sound.

Telegraph Sport understands Cliff caused considerable surprise among other executives at the shareholders’ meeting last week when he raised the issue of the Premier League’s huge spending on legal costs. Given the league has had to fight two legal cases with City – one of them the biggest in its history – it was, according to sources, “a tumbleweed moment”.

The Premier League had disclosed legal costs of £45 million costs on various governance cases against City, Chelsea, Everton, Nottingham Forest and Leicester City.

In a 175-page tribunal finding published on Monday, City secured what they consider significant victories in their arbitration after making around 20 claims against the league. The clubs will meet next Thursday to discuss the three amendments to the law. They will not vote on any law change that day. There will be a preliminary meeting of the league financial control group and its legal advisory group to discuss those changes, before the league proposes a final vote.

Those changes will propose the clubs vote to make the amendments to the rules advised by the tribunal to be unlawful. That will cover the inclusion of shareholder loans in the ATP rules, the revision of the February amendments, and procedural details around access to the central database of commercial deals.

Sources with understanding of City’s position signalled the club will oppose efforts to rush through amendments, particularly around shareholder loans. The club vehemently opposes one proposal that would rule out applying fair market value tests to shareholder loans retrospectively in the three years since APT rules were introduced.

City threaten further legal action

Cliff wrote in his email to the clubs: “Such an unwise course would be likely to lead to further legal proceedings with further legal costs. It is critical for member clubs to feel that they can have trust in their regulator.”

Arsenal, who gave evidence for the Premier League at the tribunal, are among the clubs who have utilised shareholder loans in recent years.

Cliff’s email, on Monday evening, is expected to widen the gulf between clubs on spending controls. Witnesses for the Premier League at the tribunal included Manchester United, Liverpool, Tottenham, Brighton and West Ham as well as Arsenal. Everton, Newcastle and Chelsea provided some support for City. Nottingham Forest are said to be sympathetic to City’s cause.

Those with understanding of City’s position said the champions had received some private messages of support from other clubs since the email was sent.

ATP rules govern commercial agreements between clubs and entities with similar ownership groups or background – in the case of City, those from Abu Dhabi, where its owner Sheikh Mansour is a senior member of the royal family.

At stake in the tribunal were two ATP rulings that had assessed City agreed commercial deals above fair market value with the airline Etihad and the First Abu Dhabi Bank. In both cases, City’s legal counsel were obliged to prove that the Premier League board had acted “unreasonably” in coming to the decision that the deals agreed were not at fair market value. The tribunal did not find that to be the case.

The Premier League clubs voted to introduce the ATP rules in November 2021 in the wake of the Saudi Arabia-led consortium takeover of Newcastle United. The clubs did so in order to strengthen the league’s profit and sustainability rules [PSR]. The ATP rules were devised to prevent owners investing equity disguised as PSR compliant commercial income and skewing the competitive balance of the Premier League.

Several rivals fear the ongoing war between City and the league is having a detrimental impact on the reputation of the wider English game.

Fallout from the row is a likely discussion point as Lisa Nandy, the Culture Secretary, holds talks with Crystal Palace, Liverpool and Tottenham Hotspur on Wednesday about the government’s plans for an independent regulator. Ms Nandy is also meeting several EFL clubs this week as ministers press ahead with the long-awaited Football Governance Bill.