City launch legal action against the Premier League

[halfcenturyup]

It’s not all tho surely it’s still related parties and associated parties. And why was the tweet poster as if it was new news. City are suing over associated parties not all sponsorships

This answer isn't aimed at you, but I thought it would be useful to summarise how we got here because sometimes people get confused with dates, votes and effects. I know I do. Anyone feel free to correct if I have anything wrong.

Iirc:

The requirement to disclose related parties has always been there. It's a Companies Acts requirement and is very accurately defined by accountants based on shareholding and/or control.

UEFA and the PL used the generally accepted related party definitions to look at fair value sponsorships up until 2022. UEFA still do, afaik.

In 2022, the PL introduced a new category of associated party in the aftermath of the Newcastle takeover. Everyone knows this was an attempt to stop Newcastle signing sponsorship deals at the top end from Saudi companies, in the way City did with Etihad in 2009 (a deal that was undoubtedly at the top end, but has been proven to be easily fair value with the developments at the club and the airline since). City abstained in that vote saying that, in their opinion, the rules were illegal.

In 2023, the PL attempted to introduce tighter rules on APTs, but this was voted down with clubs worried about the rule regarding directors' liability. City voted against this time because, in their opinion again, the rules were illegal.

In February 2024, the PL again put the new rules to a vote, amended for the clubs' directors' liability concerns. This time the vote was passed by the smallest of majorities after a number of clubs abstained. City voted against and said they would consider legal action. Key rule differences relevant to City's current case are that, at the time: i) it was up to the club to show fair value, now the PL set fair value ii) if, in the opinion of the PL (iirc) the sponsorship was overstated pre-February 2024, any excess would be ignored for FFP purposes. Post-February 2024, the PL requires contracts to be changed iii) clubs are now required to get a statement from the sponsor that the sponsorship is at fair value and to justify their sponsorship with two other competitive bids, or have the deal be looked at unfavourably.

A matter of weeks later, City raised their complaint with the PL. City's case, afaik, is that the whole APT set of rules is against competition law. Why? Because they are clearly targeted at a number of clubs with ME owners (for reasons we have discussed at length), that the rules are unnecessary from the sporting integrity point of view (there has never been an obvious abuse of sponsorship in the PL), that the new rules are onerous to a targeted group (affecting their commercial position in the sponsorship market and causing delays and losses) and that the new rules require perfectly valid legal contracts between parties to be modified based on the PL's own assessment of fair value.

The tribunal has, as far as we know, been completed and we are waiting for the decision. That is where we are now.

Sorry if everyone knows all this or for any (hopefully minor) mistakes (this is all from memory), but I thought it was useful to summarise.

 

[Norbiton]

Thanks for the very helpful summary. On the February 2024 vote I thought only one club abstained, six voted against and thirteen in favour? Which gave the two thirds majority required?

 

[halfcenturyup]

Thanks for the very helpful summary. On the February 2024 vote I thought only one club abstained, six voted against and thirteen in favour? Which gave the two thirds majority required?

Reported as two abstentions, 12 for, 6 against.

City, Newcastle, Chelsea, Everton, Nottingham Forest and Sheffield United apparently voted against.

The two abstentions were reported as Burnley and Palace, iirc. The fuckers.

And the rest of the absolute fuckers seemingly voted for.

 

[SilverFox2]

This answer isn't aimed at you, but I thought it would be useful to summarise how we got here because sometimes people get confused with dates, votes and effects. I know I do. Anyone feel free to correct if I have anything wrong.

Iirc:

The requirement to disclose related parties has always been there. It's a Companies Acts requirement and is very accurately defined by accountants based on shareholding and/or control.

UEFA and the PL used the generally accepted related party definitions to look at fair value sponsorships up until 2022. UEFA still do, afaik.

In 2022, the PL introduced a new category of associated party in the aftermath of the Newcastle takeover. Everyone knows this was an attempt to stop Newcastle signing sponsorship deals at the top end from Saudi companies, in the way City did with Etihad in 2009 (a deal that was undoubtedly at the top end, but has been proven to be easily fair value with the developments at the club and the sirline since). City abstained in that vote saying that, in their opinion, the rules were illegal.

In 2023, the PL attempted to introduce tighter rules on APTs, but this was voted down with clubs worried about the rule regarding directors' liability. City voted against this time because, in their opinion again, the rules were illegal.

In February 2024, the PL again put the new rules to a vote, amended for the clubs' director liability concerns. This time the vote was passed by the smallest of majorities after a number of clubs abstained. City voted against and said they would consider legal action. Key rule differences relevant to City's current case are that, at the time: i) that it was up to the club to show fair value, now the PL set fair value ii) if, in the opinion of the PL (iirc) the sponsorship was overstated pre-February 2024, any excess would be ignored for FFP purposes. Post-February 2024, the PL requires contracts to be changed iii) clubs are now required to get a statement from the sponsor that the sponsorship is at fair value and to justify their sponsorship with two other competitive bids, or have the deal be looked at unfavourably.

A matter of weeks later, City raised their complaint with the PL. City's case, afaik, is that the whole APT set of rules is against competition law. Why? Because they are clearly targeted at a number of clubs with ME owners (for reasons we have discussed at length), that the rules are unnecessary from the sporting integrity point of view (there has never been an obvious abuse of sponsorship in the PL), that the new rules are onerous to a targeted group (affecting their commercial position in the sponsorship market and causing delays and losses) and that the new rules require perfectly valid legal contracts between parties to be modified based on the PL's own assessment of fair value.

The tribunal has, as far as we know, been completed and we are waiting for the decision. That is where we are now.

Sorry if everyone knows all this or for any (hopefully minor) mistakes (this is all from memory), but I thought it was useful to summarise.

Summaries are always useful if only to confirm that I have understood the gradually released detail.
Keep doing it my friend, we are then all singing from the same City point of view.

 

[Centurions]

Reported as two abstentions, 12 for, 6 against.

City, Newcastle, Chelsea, Everton, Nottingham Forest and Sheffield United apparently voted against.

The two abstentions were reported as Burnley and Palace, iirc. The fuckers.

And the rest of the absolute fuckers seemingly voted for.

The summary looks spot on bud (or we're both losing it), I'd love to know Burnley & Palace's thinking on the abstentions as it would have failed if either had voted against.

Edit: in fact if one had voted for and the other against it would have also failed (unless it's too early for not so deep thinking).

 

[cheekybids]

This answer isn't aimed at you, but I thought it would be useful to summarise how we got here because sometimes people get confused with dates, votes and effects. I know I do. Anyone feel free to correct if I have anything wrong.

Iirc:

The requirement to disclose related parties has always been there. It's a Companies Acts requirement and is very accurately defined by accountants based on shareholding and/or control.

UEFA and the PL used the generally accepted related party definitions to look at fair value sponsorships up until 2022. UEFA still do, afaik.

In 2022, the PL introduced a new category of associated party in the aftermath of the Newcastle takeover. Everyone knows this was an attempt to stop Newcastle signing sponsorship deals at the top end from Saudi companies, in the way City did with Etihad in 2009 (a deal that was undoubtedly at the top end, but has been proven to be easily fair value with the developments at the club and the sirline since). City abstained in that vote saying that, in their opinion, the rules were illegal.

In 2023, the PL attempted to introduce tighter rules on APTs, but this was voted down with clubs worried about the rule regarding directors' liability. City voted against this time because, in their opinion again, the rules were illegal.

In February 2024, the PL again put the new rules to a vote, amended for the clubs' director liability concerns. This time the vote was passed by the smallest of majorities after a number of clubs abstained. City voted against and said they would consider legal action. Key rule differences relevant to City's current case are that, at the time: i) that it was up to the club to show fair value, now the PL set fair value ii) if, in the opinion of the PL (iirc) the sponsorship was overstated pre-February 2024, any excess would be ignored for FFP purposes. Post-February 2024, the PL requires contracts to be changed iii) clubs are now required to get a statement from the sponsor that the sponsorship is at fair value and to justify their sponsorship with two other competitive bids, or have the deal be looked at unfavourably.

A matter of weeks later, City raised their complaint with the PL. City's case, afaik, is that the whole APT set of rules is against competition law. Why? Because they are clearly targeted at a number of clubs with ME owners (for reasons we have discussed at length), that the rules are unnecessary from the sporting integrity point of view (there has never been an obvious abuse of sponsorship in the PL), that the new rules are onerous to a targeted group (affecting their commercial position in the sponsorship market and causing delays and losses) and that the new rules require perfectly valid legal contracts between parties to be modified based on the PL's own assessment of fair value.

The tribunal has, as far as we know, been completed and we are waiting for the decision. That is where we are now.

Sorry if everyone knows all this or for any (hopefully minor) mistakes (this is all from memory), but I thought it was useful to summarise.

If Emirates decided to sponsor City in some capacity they’d class as a related party due to having relationships & ability to influence. Yet, we are unable to influence them to no longer sponsor Arsenal cos they are a bunch of Cunts!

 

[KS55]

It’s not all tho surely it’s still related parties and associated parties. And why was the tweet poster as if it was new news. City are suing over associated parties not all sponsorships

Unless you have inside info, you have no idea what the cause of action is, as City have not disclosed it.

 

[Gazza]

Reported as two abstentions, 12 for, 6 against.

City, Newcastle, Chelsea, Everton, Nottingham Forest and Sheffield United apparently voted against.

The two abstentions were reported as Burnley and Palace, iirc. The fuckers.

And the rest of the absolute fuckers seemingly voted for.

Why would Villa not vote against it?

 

[KS55]

This answer isn't aimed at you, but I thought it would be useful to summarise how we got here because sometimes people get confused with dates, votes and effects. I know I do. Anyone feel free to correct if I have anything wrong.

Iirc:

The requirement to disclose related parties has always been there. It's a Companies Acts requirement and is very accurately defined by accountants based on shareholding and/or control.

UEFA and the PL used the generally accepted related party definitions to look at fair value sponsorships up until 2022. UEFA still do, afaik.

In 2022, the PL introduced a new category of associated party in the aftermath of the Newcastle takeover. Everyone knows this was an attempt to stop Newcastle signing sponsorship deals at the top end from Saudi companies, in the way City did with Etihad in 2009 (a deal that was undoubtedly at the top end, but has been proven to be easily fair value with the developments at the club and the airline since). City abstained in that vote saying that, in their opinion, the rules were illegal.

In 2023, the PL attempted to introduce tighter rules on APTs, but this was voted down with clubs worried about the rule regarding directors' liability. City voted against this time because, in their opinion again, the rules were illegal.

In February 2024, the PL again put the new rules to a vote, amended for the clubs' directors' liability concerns. This time the vote was passed by the smallest of majorities after a number of clubs abstained. City voted against and said they would consider legal action. Key rule differences relevant to City's current case are that, at the time: i) it was up to the club to show fair value, now the PL set fair value ii) if, in the opinion of the PL (iirc) the sponsorship was overstated pre-February 2024, any excess would be ignored for FFP purposes. Post-February 2024, the PL requires contracts to be changed iii) clubs are now required to get a statement from the sponsor that the sponsorship is at fair value and to justify their sponsorship with two other competitive bids, or have the deal be looked at unfavourably.

A matter of weeks later, City raised their complaint with the PL. City's case, afaik, is that the whole APT set of rules is against competition law. Why? Because they are clearly targeted at a number of clubs with ME owners (for reasons we have discussed at length), that the rules are unnecessary from the sporting integrity point of view (there has never been an obvious abuse of sponsorship in the PL), that the new rules are onerous to a targeted group (affecting their commercial position in the sponsorship market and causing delays and losses) and that the new rules require perfectly valid legal contracts between parties to be modified based on the PL's own assessment of fair value.

The tribunal has, as far as we know, been completed and we are waiting for the decision. That is where we are now.

Sorry if everyone knows all this or for any (hopefully minor) mistakes (this is all from memory), but I thought it was useful to summarise.

Thanks for the summary. One question arises. We do not know the detailed cause of action as City have never disclosed it. Have they challenged the whole rule or just selected aspects?

 

[Man_City_Loyal]

Reported as two abstentions, 12 for, 6 against.

City, Newcastle, Chelsea, Everton, Nottingham Forest and Sheffield United apparently voted against.

The two abstentions were reported as Burnley and Palace, iirc. The fuckers.

And the rest of the absolute fuckers seemingly voted for.

Palace whos owners own other football clubs? haha odd lot