Why Man City will chalk up a victory over the Premier League after key decision

'Far happier' - Why Man City will chalk up a victory over the Premier League after key decision

Manchester City and the Premier League have reached a settlement after a dispute over the league's Associated Party Transaction (APT) rules.

Football finance expert Kieran Maguire believes Manchester City will be "far happier" than the Premier League after the two parties came to an agreement over the club's dispute regarding sponsorship rules.

City have dropped a legal challenge over the Associated Party Transaction (APT) rules, which were drawn up to try to judge fair market value for commercial deals from companies with links to a club's owner.

City challenged those rules last year after the Premier League blocked a City commercial deal with Etihad Airways. Although a tribunal ruled they were unlawful, the league introduced a second set of guidelines, which City were also challenging.

But that case has now been dropped, and Monday's statement confirmed the club was happy for the amended rules to stay in place. It is expected that the sizeable deal with Etihad Airways can now progress, offering City another substantial financial boost as their commercial revenues continue to rocket.

"My understanding is that City would not have agreed to a settlement unless they were happy with the terms," said Maguire, from the Price of Football podcast. "They felt that they had a very strong case, so I think the big issue will be the renewal of the Etihad contract.

"What is the fair value of somebody sticking their name on your shirt? The simple answer is that nobody knows. I think the Premier League were trying to impose a value, City were pushing back, and City have probably come away pretty happy with the fact that the Premier League is going to have to concede that what's fair value to you is different to fair value to me.

"For example, if my granddaughter draws me a picture, that might be worth a lot more money to me than it would be to you. If Manchester City are getting sponsorship from Abu Dhabi, it's going to be worth a lot more to Abu Dhabi companies than it would be to a company in Liechtenstein."

The settlement has ruffled some feathers within the Premier League, with a number of clubs aggrieved at City registering what plenty see as a win for the club.

Maguire believes many clubs would have had little issue with the APT arguments, but a small number of City’s immediate rivals will be frustrated at the idea of the Premier League agreeing to settle.

"There are probably a dozen clubs in the Premier League that don't actually care," he said. "Because if you're Brentford or Bournemouth, you don't see Manchester City as a rival. You see Palace, Wolves, Brighton, and West Ham as rivals because they're the clubs that are going to try to fill those middle-tier positions.

"There are clearly some clubs that do not like Manchester City because they feel they would have achieved greater success on the pitch had it not been for Manchester City. The pressure is actually coming from a relatively small number of clubs.

"They will be unhappy, I suspect, with this. But given the fairly strong victory that Manchester City had in APT 1, the Premier League has come out with some credit by Manchester City agreeing to the rules going forward, but Manchester City will be far happier than the Premier League with this settlement."

The victory is also substantial for City because of the size of their commercial income. The club already earns a greater proportion of revenue from commercial deals than any of their Premier League rivals.

Maguire also believes it signals a thawing in the often fraught relationship between City and the Premier League, but anyone looking to leap from this settlement to a potential outcome in the charges the club face over alleged breaches of financial rules shouldn't jump to conclusions.

"I think it's a sign of better relations. I think we've got an entente cordiale now between the two," Maguire said. "City were never bothered about the interest-free loans [from shareholders]. It was just a means of creating a negotiating tool with the Premier League for what City felt was an unfair treatment of their relationship with Etihad.

"Some people are putting two and two together and getting 115, in the sense that they say, could there be a negotiated settlement now for the other charges here for the big one.

"I think these two things are completely independent, and I think the Premier League might be able to sell this settlement to the other clubs because it was a way of saving you legal costs. The cost of the big case is so huge that it's too far down the road to have a negotiated settlement.

"Clubs want an outcome. They want somebody's head on a stick."

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