Premier League facing imminent legal action from top-flight giants over controversial new rule brought in TODAY
MANCHESTER City led a failed rebellion against Premier League financial rule changes that split the 20 clubs even further.
And the champions – already embroiled in a drawn-out battle over the 115 charges laid for alleged FFP breaches – are now threatening legal action against the league following what was described as the “tightest vote in Prem history”.
The proposed changes to tighten and speed up the timetable on “related party transactions” – companies linked to club owners were tabled at yesterday’s “shareholder” meeting of the 20 clubs.
Prem leaders believe the new rules stop clubs from being able to sign commercial deals with companies under common ownership at inflated prices to boost their spending power on players.
Before the vote, Premier League bosses informed all the clubs that one of their number – believed to be City – were launching proceedings because they argued the new regulations were “unlawful”.
City, who declined to confirm they were the protagonists, are arguing that the changes are “unlawful” and breach competition legislation.
They warned Prem chiefs that would consider launching arbitration proceedings – a legal process questioning the validity of the new rules – if they were passed.
That led to a clear division between the two factions – just as when proposals to ban clubs from signing players on loan from multi-club ownership sister organisations were defeated in November.
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City’s overall sponsorship deals total £235m this season and financial backers include Etihad Airways, technology group Etisalat, Abu Dhabi Tourism and Emirates Palace.
Three months ago, City, Newcastle and Chelsea had four allies to prevent the changes being passed.
But it is understood that Burnley and one other club abstained at yesterday’s vote.
That meant 12 clubs in favour, with six opposed – exactly meeting the two-thirds threshold required for a vote to pass under Prem regulations.
The spat left some of the losing sides angry and frustrated, with one club furious that the Prem position had “squeaked” through by the minimum margin after the two unexpected abstentions.
Others were privately pointing fingers directly at rivals and the Prem leadership, claiming the dispute had highlighted “fractured relationships” throughout the League.
In a statement, a Prem spokesman said: “Following a full review of the existing Associated Party Transactions Rules and Fair Market Value assessment protocols, clubs agreed to a series of amendments to further enhance the efficiency and accuracy of the system.”
The new regulations will now be introduced into the Prem rulebook for next season but City and their allies may seek to overturn the new position either through a future vote or the legal option.
It comes with disputes still between clubs on how future spending rules should be drafted, with a possible change in the Profitability and Sustainability threshold and linking expenditure to revenues on the table.
But Prem bosses did signal a belief that the contentious potential “New Deal” for funding the EFL could be coming closer to an agreement after “productive discussions” including face-to-face meetings between clubs from both leagues on Wednesday evening.
The spokesman added: “This included plans to move towards a new financial settlement with the EFL and to agree a long-term deal for the good of English football.
“A desire to seek a resolution on remaining issues was reiterated in the meetings, including a commitment to a process and timeline, with the continuation of discussions between the leagues.
“To build on this momentum, conversations between clubs from the two leagues will now continue over the coming weeks.”