Manchester City and the Premier League have reached a settlement to "terminate" a legal dispute over the league's Associated Party Transaction (APT) Rules after the club accepted that the existing rules are "valid and binding."
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End of a Year-Long Legal Battle
Manchester City and the Premier League have reached a settlement in their dispute over the rules governing associated party transactions (APTs). This significant development brings to a close a contentious legal battle that has dominated football headlines throughout 2025.
City had launched arbitration proceedings on January 20 against the current rules, which are designed to ensure that deals between clubs and entities linked to their ownership are done at fair market value. The dispute centred around the club's frustrations with how the Premier League implemented these financial regulations, particularly regarding their lucrative sponsorship arrangements.
Key Settlement Terms:
- Under the settlement, City accept that the current rules governing APTS are "valid and binding"
- City and the Premier League released statements at the same time Monday saying they have "agreed to terminate the proceedings"
- It has been agreed that neither the Premier League nor the club will be making any further comment about the matter
Background to the APT Rules Controversy
These rules were brought in after Newcastle United were taken over by a Saudi Arabia-backed consortium in 2021 and designed to maintain the competitiveness of the Premier League and stop clubs inflating commercial deals with businesses associated with their owners.
In 2023, City's Etihad sponsorship extension faced pushback for not meeting "fair market value." This became a flashpoint in the relationship between Manchester City and the Premier League, leading to the extensive legal proceedings that have now concluded.
City's challenge was understood to have included criticism of the way the Premier League treated shareholder loans under the rules. The club argued that these regulations were discriminatory and represented what they termed "tyranny of the majority" by rival clubs.
Implications for Manchester City's Commercial Deals
The settlement has significant implications for Manchester City's commercial operations, particularly their relationship with Etihad Airways. City had been seeking to extend its deal with Etihad in 2023, but the Premier League blocked the agreement on the grounds that it did not represent fair market value. The settlement announced today between City and the league could result in a new deal with Etihad being signed off.
Their original 2011 deal was worth £400m over 10 years. Any extension in 2025 is expected to blow past that figure. This potential increase reflects both inflation in football commercial deals and Manchester City's enhanced global profile following their recent successes.
Stadium Development Context
City is in the process of carrying out a major redevelopment of Etihad Stadium, with its capacity to increase from 53,400 to over 60,000 and a new 3,000-capacity fan zone being installed. The new North Stand is scheduled to open during the 2025-26 season, with the fan zone opening in late 2026.
Separate from the 115 Charges Case
The settlement is unrelated to the hearing into the 115 charges issued against the Abu Dhabi-owned club by the Premier League for alleged breaching of financial regulations. This distinction is crucial for understanding Manchester City's ongoing legal challenges.
A hearing into the 115 charges, which City deny, was overseen by a three-person panel between September and December 2024. City are still awaiting a verdict from their 115 charges cases despite the hearing being concluded in December when closing arguments were heard by a three-person Independent Commission panel.
A verdict has yet to be reached. The football world continues to await this decision, which could have far more significant consequences for Manchester City than the now-settled APT dispute.
Wider Impact on Premier League Financial Governance
City's acceptance the amended rules are valid and binding appears to put to bed an issue which had threatened to have a major impact on the league if the rules had been significantly weakened. Without APT rules, entities linked to clubs' owners could potentially overvalue sponsorships and other commercial transactions to boost a club's revenue, putting that club in a stronger position under the league's profitability and sustainability rules (PSR) and therefore given more leeway to spend on transfer fees and player wages.
Clubs like Newcastle United, owned by Saudi Arabia's Public Investment Fund (PIF), have also expressed frustration with the APT framework. Their ability to strike sponsorships with companies linked to their ownership group faces the same restrictions City have been fighting. So, the outcome here sets a precedent.
Looking Forward
The decision to settle is significant, with the dispute previously described as football's civil war, and the battle over the future of English football, given the significance of the rules for how money is spent in football.
The resolution of this dispute allows both Manchester City and the Premier League to focus on football matters rather than courtroom battles. The Premier League has kept its rules in place but made concessions along the way. City, meanwhile, have ensured that they can still work with Etihad and potentially push the market higher for what "fair value" really means.
At the end of the day, this wasn't about who "won" or "lost." It was about both sides protecting their interests and moving on.