Private emails apparently show that Man City have expressed their concern over the new proposals for APT rules, with Liverpool and Everton directly sent a message ahead of a vote.
Manchester City have reportedly sent a letter to Liverpool, Everton and all other Premier League clubs to share their concerns over redrafted finance rules ahead of next week’s vote. The club have claimed the proposed amendments to Associated Party Transaction rules [APTs] are ‘unlawful’.
Both Man City and the Premier League claimed victory over a landmark commission ruling in October which concluded that while there was a need for APT regulation, some elements of the framework breached EU competition law. As a result the Premier League has been adjusting its rules.
A letter seen by the BBC shows that Man City’s chief lawyer, Simon Cliff, believes the newly-drafted proposals still contravene the judgement passed by the commission. He has also accused the Premier League of rushing through the consultation process, suggesting that clubs would be “voting blind”.
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As relayed by the BBC, Cliff said in the letter: “It is important that a new regime is grounded in rules that are fair, considered and legal. Our strong desire is to avoid any future costly legal disputes on this issue and so it is critical that the Premier League gets it right this time round.”
The Premier League, amid correspondence with Man City on Thursday, said it “rejects in the strongest possible terms the repeated and baseless assertions” the club has made about the case. It refutes the notion that it has misled its members.
The league added in its letter: “To the contrary, the league is well aware of, and takes very seriously, its obligations to act fairly and with an open mind.” It stated it has “acted fairly, transparently and responsibly in circulating considered proposals for consultation in a prompt manner”.
The commission in October ruled that loans to clubs from owners – titled ‘shareholder loans’ – should not have been excluded from spending limits. Going forward, these will be factored into such costs and thus be subject to interest rates, in a reversal of the current rule.
One sticking point underlined by Man City lawyer Cliff is the Premier League’s proposal for previously-agreed shareholder loans not to be backdated for interest costs, and that such costs will only apply for fresh agreements after the new rules are in place. Cliff argues this is unlawful.
He said this was “one of the very things that was found to be illegal in the recent arbitration”. Cliff claimed that voting in favour of this would “create market distortions” and thus would be “not lawful”.
Cliff added that Man City are “strongly in favour of robust, effective and lawful regulation” but that further discussion was “essential” given both parties disagreed about whether the current APT framework was designated void.
“Common sense dictates that the Premier League should not rush into passing amendments – particularly ones which entail material legal risk – until [it] knows the outcome from the tribunal,” Cliff added. The Football Association was also sent the same letter that was delivered to clubs.
While defending its corner against Man City on Thursday, the Premier League said: “Throughout the consultation, the league has reflected upon all feedback provided by clubs, including from MCFC, and sought the opinion of leading counsel to consider the proposals.
“That MCFC does not agree with the proposed amendments, or with the timing of the process being undertaken, does not mean the consultation itself is deficient or that the league has failed to comply with its obligations as a regulator.”
In the letter, the league also accused Man City of “a tendentious and inaccurate interpretation” of the minutes from a call held with clubs last month. It stated that the fact Man City “does not agree with the process does not provide a credible basis to impugn it”.
In regards to potential further legal action, the league scorned that “such threats are meritless, and advanced without any attempt to articulate a credible ground on which MCFC could seek to restrain the consultation process”.
