Through Premier Leaguesenior officials are now preparing, amid growing murmurs Manchester City A decision is expected “this month.” It is believed that many of the club's regular staff have become accustomed to the prospect as it has hung over them for so long – and much longer than expected.
It speaks volumes that people involved in the game began citing the failure of the Chinese espionage trial and wondering whether there would be government intervention given the geopolitical aspects of owning a club in Abu Dhabi.
And yet with all this “115” – or “129/130”, as it came to be called in football circles. – seen as an existential moment for modern English football due to its high stakes, there is now a belief that its actual impact could be significantly reduced.
This relates to the parallel associated party transaction (APT) case. which ultimately ended in a settlement between City and the Premier League.
The sentiment may come as a surprise given how muted the reaction to the announcement was in early September, especially in contrast to the cacophony of noise the case had previously generated. There was definitely no information war, as was evident from previous events in this story, including the fact that the original rules were declared illegal exactly one year ago. There was a feeling that this agreement represented simply a lull before a “big” or perhaps much-needed agreement. The release of identical statements suggests the latter, amid a sense that many are tired of the constant fighting and a desire to “draw a line on brand-damaging litigation.”
Independent understands that APT settlement may even constitute an end in itself, especially in the sense that it is seen as protecting an important part of the financial rules. That's why influence city business may be reduced. Or, as they said in the Premier League, “115 looks to the past, APT looks to the future.”
The APT dispute was ultimately fueled by concerns from other clubs that new rules would be needed to deal with the growing problems of public ownership and, in particular, the special nature of “related parties” in autocracies where the lines between public and private are blurred. In other words, a relatively local company can be tasked with concluding an international deal with a state-owned club. The company would have no need for such promotion, and most normal owners – even capitalist funds – do not have such opportunities.
Because such money often comes from the same bank, which represents sovereign wealth, many football executives believe it should be considered equity anyway, i.e. income that will not increase PSR limits. There were concerns that this would be an indirect way for states to dramatically increase their purchasing power.
The new APT rules have been introduced to increase control over this and properly link revenues to costs to prevent excessive inflation and maintain competitive balance.
The latest version of these rules, agreed earlier this year, is now considered to be set in stone. This came after long and difficult negotiations, although all parties felt that it was probably time to lower the temperature on many issues.
This whole episode has indeed reached some peaks that seem to illustrate the full range of problems associated with government ownership. City officials would naturally point to valid complaints, even to the point where the original rules were declared illegal. Other clubs believe that they took on the APT business primarily because they wanted to “win” to “115”. They pointed out how City's complaints had been honed in on shareholder loans, despite the fact that they had previously had no complaints on the issue at all.
Either way, the case leaves open the possibility that the entire APT concept could be scrapped, while leaving the Premier League open to costly compensation claims for deal breakers. In other words, chaos and further “legitimate business” against the backdrop of growing hostility in English football.
The case was already seen as a landmark event as it marked the first time a Premier League club had challenged the competition's founding principle of a partnership having a majority vote on all regulatory decisions. The aggressive attitude of City representatives during meetings only made this worse.
It was because of all of this that the Premier League was eventually persuaded to get to the bottom of the rules and not break those rules. The basic principle of competition was preserved and chaos was avoided.
Gone Arsenal Executive Vice Chairman Tim Lewis was considered an influential figure here, given that he was by far the most outspoken on government ownership. There is some disappointment that this position has not been put forward more publicly, given that the Premier League never seems to promote the virtues of PSR.
Much of the noise comes from those who argue that the rules are unfair. The Premier League may now lack that voice.
It is clear that the settlement negotiations were painstaking and complex, but ultimately successful.
There is currently a strong belief in the Premier League that the state or state-linked owners will not be able to test the rules through megadeals. The settlement is still causing debate about what it might mean for the big one, especially since the two are expected to go into close contact: one in September, the next potentially in October of this year.
The answer is, basically, nothing. “115” is a completely separate trial where everyone working on it is “locked in” throughout the entire process. For example, Clifford Chance's lawyers representing City were essentially locked in with the club's lawyers.
One process does not affect the other. City, meanwhile, maintains his innocence.
However, the wider case has had other consequences as many believe it has caused clubs to delay important decisions. The competition has recently stalled on several important issues due to disparate voting blocs. This was visible in the failure to push through a version of UEFA's squad cost multiplier, as well as potential innovations such as “pegging” – whereby the richest clubs could only spend a multiplier of the poorest clubs' revenue.
Such hesitation is explained by the possibility that the City case will blow things up again. There is still a lot of uncertainty in the Premier League regarding future financial rules. It is known that some City companies have even postponed potential deals as the case drags on.
Underneath all of this is the basic protection within the rules. This is no small matter, although now everyone is waiting for the “big thing”.
