City sue Premier League

Manchester City’s legal case against the Premier League’s associated party transaction (APT) rules will begin on Monday, June 10. City are suing the league in an attempt to have the rules — which they claim are unlawful — abolished in a two-week private arbitration hearing.

The regulations are in place to guard against clubs using sponsorship deals with companies linked to their owners to inflate revenue streams and allow more room for spending. In February, Premier League clubs voted to toughen rules on associated party transactions.

City now argue that they are the victims of “discrimination” in a 165-page legal document justifying their case. City are also arguing the league’s democratic system of requiring at least 14 clubs, or two-thirds of those who vote, to implement rule changes should be abolished to guard against decisions being made by “the tyranny of the majority”.

It is arguable that many Premier League rules are not compatible with compeition law, specifically the 1998 Act.

If City are successful in their claim — and some rival clubs fear they will be — it could enable the richest clubs to value their sponsorship deals without independent assessment, vastly boosting the amount of money they can raise and therefore giving them far greater sums to spend on players.

While The Times knows of at least one club who have submitted a witness statement in support of City for next week’s arbitration hearing, sources believe more than half have sided with the Premier League.

Their rivals believe that what City are doing will actually destroy the competitiveness of the world’s most popular league, allowing clubs with super-rich owners to spend unlimited amounts of money on their playing squads and infrastructure and nullify Financial Fair Play rules.

Millions are being spent on legal fees to fight this case. One senior club source says the Premier League’s legal bill has more than quadrupled in the past year, from about £5million to more than £20million. They also point to the fact that since February the Premier League’s own legal department has been forced to shift its focus to this claim when it is also trying to prepare for the hearing into City’s 115 charges.

City also complain that, when it comes to negotiating any form of sponsorship agreement, clubs in the north are at a disadvantage to those in London, who, they say, can charge higher ticket prices. However, rival clubs estimate that, based on median ticket prices at the Etihad Stadium and the seven Premier League clubs in London, City are ranked third.

City blame the Premier League for not regulating spending when clubs such as Manchester United were more dominant, arguing they have been prevented from monetising their brand in the way United did. City also say the rules penalise clubs who have “lower-profile sporting histories”.

Wolves get raw deal from FFP

I used to see a lifelong Wolves fan for lunch once a month. He was approaching ninety, but still went to games. Sadly he passed away the other week. As football finance guru Kieran Maguire has noted, Wolves continue to be constrained by financial fair play rules. Radio 4 this morning described them as this year's 'crisis club' and the pessimists have certainly been piling in. Martin Samuel wrote sympathetically in the Sunday Times yesterday, saying that the Premier League drives talent away with regulatory red tape: 'Why could Al-Hilal sign Neves? Because Wolves needed the money. And why did Wolves need the money? Because the club had to comply with an artificial construct known as financial fair play. So Wolves are going skint, yes? No. There is no suggestion that Wolves are in financial trouble, only that they are failing to meet the rigours of FFP. Wolves’ owners appear to have the money to run the club, and invest in the club, and in fact came up with a pow

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000. The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts. Money brought in from football has gone up too. Match day income is

Lau on the ropes

Financial challenges are building up for Guichan Lau whose company WBA Holdings owns 66 per cent of West Bromwich Albion. His company's accounts show that it is in default on a £2 million from a West Midlands heating company called Warmfront Holdings. Warmfront has agreed to take no action to reclaim the loan and interest until February next year. Given a punitive rate of interest of 5 per cent a month, the amount outstanding will then be around £4 million. Lai has missed three deadlines to repay a loan from the Baggies to his Hong Kong company Wisdom Smart Corporation. [sic] Meanwhile the club have a £20m loan from MSD UK holdings at an annual interest rate of 13.8 per cent.

The Political Economy of Football V2

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