Lawyer hands Man City FFP verdict as Arsenal, Chelsea and Tottenham get ‘severe’ hint
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Manchester City
Former Manchester City financial advisor Stefan Borson has expressed concerns that the club might not come out on top in their legal tussle with the Premier League concerning Associated Party Transaction (APT) regulations. Despite these worries, Borson has pointed out that the outcome is unlikely to affect Manchester City’s ongoing case regarding the 115 allegations of Profit and Sustainability Rules (PSR) breaches brought by the Premier League in February 2023, which the club vehemently denies
The hearing for City’s challenge against APTs started on Monday, with the club arguing that they are illegal as top-flight rivals such as Arsenal, Chelsea and Tottenham watch on. These rules allow the Premier League to scrutinise sponsorship deals involving entities linked to club owners. Introduced in 2021 following Newcastle United’s takevover, these regulations aim to prevent overvaluation of deals between connected parties, which could give a club an unfair advantage in complying with PSR. If City were to win this case, it would strip the Premier League of its power to act as a regulator over such transactions, allowing them to proceed unchecked.
However, Borson suggests that overturning the APT rules will be a formidable challenge for the club.
Stefan Borson said: “I just think competition law arguments of this nature are esoteric, fine-margin calls and therefore the chances of them overturning a set of rules that have been put in place following a vote is going to be a challenge for City.”
Borson had previously made it clear that the outcome of the APT hearing will not significantly affect the 115-charge case against Man City, which involves allegations of improper revenue sourcing and lack of cooperation during the period from 2009 to 2018. He pointed out that APT regulations were only introduced in 2021, well after the alleged breaches by City, indicating no direct conflict between the two cases.
On City’s 115 charges and a potential punishment if found guilty,
Borson explained: “If you go back to what the rulebook looked like at the time in which City are accused of these breaches, there were no rules about Associated Party Transactions. But there’s always going to be rules about filing fair accounts. There’s no set of rules that would permit what City are accused of doing between 2009 and 2018. They’re accused of making up their accounts. And if that is proven, then they will suffer very severe action.”
The Premier League’s PSR case against City is slated to commence in November and is expected to last approximately six weeks. It should be noted that both the club and the Premier League can appeal any decision made.
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