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Why Man City is taking legal action against Premier League after Liverpool voted for measure

The Manchester City owner Abu Dhabi royal Sheikh Mansour bin Zayed Al Nahyan (centre with scarf) next to chairman Khaldoon Al Mubarrak (right) as the teams come onto the pitch before the UEFA Champions League Final between Manchester City and Inter Milan at the Ataturk Olympic Stadium on June 10th 2023 in Istanbul, Turkey.
-Credit: (Image: Tom Jenkins/Getty Images)


Manchester City is mounting a legal challenge against the Premier League. Against the unavoidable backdrop of its 115 pending charges, the Etihad outfit is now challenging a separate (but potentially related) measure that Liverpool helped to vote into existence.

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Having initially agreed to a temporary ban on 'associated-party transactions' (APTs), Premier League clubs later voted through a permanent measure to tackle the issue. It requires teams who are receiving money from sponsors related to their owners to undergo a 'fair market value' check.

Per the ECHO in February, Liverpool was among the clubs to vote in favor of the rule. But Manchester City will now use the legal route to challenge it, disputing the Premier League's right to assess the value of sponsorship deals (via an independent body).

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Many of the 115 charges relate to similar issues, with Manchester City accused of artificially inflating various commercial deals — although regardless of the outcome of this upcoming arbitration hearing, set to begin on Monday, those alleged breaches will be assessed against the regulations that were in place at the time. Nonetheless, according to the Times, rival clubs fear that the outcome in this instance could be 'key' to the eventual verdict. Manchester City denies all of the charges.

In this new case, Manchester City is arguing that the APT rules are unlawful under the Competition Act 1998, and will seek damages from the Premier League, according to The Times. In a 165-page legal document, it argues that it has suffered from 'discrimination' and 'tyranny of the majority'.

It's claimed that between 10 and 12 other clubs in the league have provided witness statements or letters in support of the Premier League's defense, with those who have given statements liable to be called to give evidence at the hearing. It's not yet clear whether Liverpool was one of those clubs.

After the Premier League had warned member clubs of a possible legal challenge against APT regulations, Manchester City followed through with that threat on February 16, with the hearing set for June 10. It is expected to last two weeks.

Liverpool.com says: Liverpool will certainly be watching these proceedings very closely, whether or not it is in any way involved in the upcoming hearing. This is the latest act in a gripping saga between the Premier League and its four-in-a-row champion, one which is bound to shape the future of the game in England in one way or another.

When it comes to the 115 charges, that case is not expected to be resolved until next year. However, as The Times remarks, a ruling that the league's existing associated-party rules are unlawful would color the historic allegations, which also revolve around the idea of fair market value.