Man City's APT 'victory': The spin, the substance and the sad truth

If you’re feeling a bit dizzy trying to understand the latest chapter in the Premier League vs Manchester City then that would be understandable.

Indeed, the levels of spin are such that most heads in football topped out at about 2000 RPM on Monday afternoon and only showed signs of slowing down as we got much later into the evening.

Having stared at the 165-page verdict (and 10-page appendix) all day and spoken to a number of lawyers, executives and people within the game to try and work out what the hell it all means, I then tried to organise my thoughts a bit below.

In the end the things that stood out to me about this all filtered into three main categories:

• the spin

• the substance

• the sad truth

And so that’s how I’m going to approach the whole story, trying to zoom out a little bit. If you don’t want to read about Man City then skip to the bottom of the newsletter.

If you are interested in the finer details of the case then I really would recommend at least skimming the document itself.

Necessarily, the judgement is incredibly thorough and you leave with little doubt on how the three retired judges - Sir Nigel Teare, Christopher Vajda KC and Lord Dyson - came to the conclusions they did.

The spin

“Who won?” was the first question most people want to know about a tribunal like this, but not with the way this news broke as the Daily Mail (Mike Keegan) and the Times (Matt Lawton) both published the story almost simultaneously at 2.18pm BST as a “huge win” and “victory” for Manchester City respectively.

At this stage, not many people had read the judgement itself but as more did (and the Premier League had an opportunity to release a statement) the coverage elsewhere began to suggest a more balanced result than the early reporting.

(At the same time, I have spoken to lawyers who disagree on this case so it’s entirely to be expected that journalists would too.)

Just for a picture of things, these were the headlines for the news story (not analysis/comment/opinion) about the judgement on each of major UK outlets:

Additionally, the BBC, perhaps predictably, found itself right in the middle of the road with: Man City v Premier League legal case verdict - what it all means.

Of those eight above; three declare City outright victorious, one says City ‘claim’ victory, one suggests City picked up a minor win and the other three frame it as both sides having won to some degree.

With nobody suggesting the Premier League alone came out on top, it’s probably fair to assume that is not what happened here. If there was a winner, it was likely City but there might not have really been one.

My biggest question is whether it even matters who won? The longer I look, the less I think it does.

To explain why, we first have to address some of the actual verdict….

The substance

So we have both sides claiming victory and the undeniable truth is that they both won on certain things.

Both sides won on some claims and lost on others.

City succeeded in having the Premier League rules governing APT (rules they have opposed from the first time they were suggested) declared unlawful. That’s significant!

The Premier League, however, were vindicated in their introduction of those rules after the tribunal supported “the overall objectives, framework and decision-making of the APT system” - even deeming them “necessary… in supporting and delivering sporting integrity and sustainability in the Premier League.”

That’s pretty significant too!

‘The rules are, broadly, a good thing but they were written badly, so go off and fix them and the consensus from these retired judges is that they will strengthen the league.’

You can see why the Premier League would think that is a positive result also, and that they really just need to tweak a couple of lines in the rulebook.

(Out of interest, the PL has called an emergency meeting for next week to discuss exactly how they go about re-writing and re-establishing those rules)

A big piece of the APT rules being deemed unlawful was that the calculations specifically (and deliberately) don’t include shareholder loans, with the tribunal deeming an interest-free loan with flexible repayment terms to be as out of whack with what one could expect in terms of fair market value as getting an inflated sponsorship deal from a company that shares ownership with the club.

The league excluding shareholder loans from those rules was “discriminatory” and “distorted… and restricted competition” according to the judges.

The knock-on effect of this is likely to be an increased focus on those clubs like Everton (£451m), Brighton (£373m) and Arsenal (£259m) who lead the league in shareholder loans. It might just be focus though. There have been some fairly insane leaps as to what this could mean for those teams, especially given the financial rules are changing already and that as many clubs owe £100m or more to shareholders (6) as owe nothing to shareholders. Think of the votes, people.

As we discussed with how transfers and PSR rules interact, whatever the regulations you lay down, there will always be loopholes. It is the same in the tax code or in business regulations and with an industry as big as football it will always be the same.

So teams will continue to fight those badly written rules in the courts and/or find ways to circumvent them and the PL will try to patch them up as they go.

The tribunal did not find the principle of regulating APT to be unlawful. The principle of that is fine, the Premier League just wrote the rules badly and (for the second time) were found to have done so unlawfully. When you remember the Leicester City verdict and how a poorly written rulebook left them red-faced, does it threaten to leave much of the league's rulebook open to challenge?

Just as well there isn’t a 10-week hearing going on right now that promises to have a far greater impact on the league than this comparatively insignificant case…

…ah wait.

The sad news

Yes, at this very moment we are about 30% of the way through a separate Man City vs Premier League hearing that is expected to last months longer than the one we spent Monday obsessing about, address some 115 charges of far greater scope and significance and have even bigger ramifications on the league and its past, present and future.

Many I spoke to about this case are jaded not just by the whole process but also the seemingly endless parallel legal fights. For those who feel that way too, the bad news is that we have many months to go. This 175-page award is the starting point, and even if you believe that City have won the battle on APT then we are merely enduring the early skirmishes of a far greater war.

It is understandable that football at large is experiencing a weariness to that war. You hear it from coaches, from fans, from administrators.

The fear is that Premier League clubs suing their league could now become a regular occurrence, an ongoing backdrop to games.

How many years until we find ourselves waiting around weeks after the season has finished to find out from an appeals panel in London which team is going to be relegated and who is going to survive? Or who got the last Champions League spot? Or won the title?

Perhaps it is just the logical extension of how instead of celebrating a goal now we instead cut short our joy, stare at a screen for five minutes and then have VAR decide our fate in the most soulless way possible.

And if we are talking about the possibility of more (and endless) litigation then one of the obvious conclusions drawn from this judgement is that clubs may be able to sue the league for damages relating to those APT rules. City are expected to do so but the judgement must have also made for interesting reading in Newcastle.

A broader trend here is that courts, arbitrators and tribunals appear increasingly comfortable in holding football’s governing bodies’ feet to the fire.

It was only on Friday that a European Court found parts of FIFA’s transfer system to be unlawful in the Lassana Diarra case, while the organisers of the zombie Super League claimed victory fairly recently when FIFA and UEFA rules were also deemed unlawful, and agents successfully fought the FA and FIFA on attempts to cap their fees amid a host of other bloody noses for those who govern the world’s biggest sport and its competitions.

Beyond football, the NCAA in America has disintegrated under closer inspection and the International Skating Union (the governing body for figure and speed skating) also recently lost a landmark case along similar lines.

Indeed, one thing that is becoming clearer is that having the same body regulating the competition but also as its commercial organiser is becoming increasingly difficult.

This judgement refers to the Premier League as “double hatting”, which it describes as:

“acting as both regulator of a sporting competition, such as football, and engaging at the same time in economic activity by, for example, the sale of media rights.”

To take that further:

1. The Premier League was originally imagined as a hollow vessel simply to administrate the English top flight. Now it is throwing money at a constantly expanding legal team because its constituents are taking them to court and they may have to hand over compensation. Is this what the PL is supposed to be doing?

2. FIFA began its life as world football’s governing body, literally a federation of federations, but now makes billions from hosting football tournaments. Imagine they were forced to choose to be either the governor of football or the organiser of the World Cup every four years ($7.5bn revenue in the last cycle) - which would they pick if doing both was no longer possible?

Do these things appear sustainable? Is it a natural evolution that had to come with football’s seemingly limitless commercial growth? Is it a by-product? The price of success?

Where the financial stakes are high, there will always be disputes settled in courts but the question might increasingly be whether that will force a separation of those who run these competitions and those who set the rules.

To be clear, there is currently no legal imperative to separate the functions of the ‘double hatters’ but there might be a practical one.

The Premier League has fought the independent regulator in the knowledge they would almost certainly lose control and money.

With the direction things are going, might they make it back quickly simply by not having tens of millions to pay in legal costs every year?

We’re all just trying to find a way out of this mess.

Conclusion

And so I return to those three filters for this case.

The spin: City might have won. It might also have been a score draw, as one person described it to me, but what is clear is that City really wanted everyone to think they had won. That isn’t unusual in itself, but if you look at the wider context of the 115 charges then you can see how this might feel like a fairly insignificant victory in a year’s time if they’ve been relegated and/or stripped of titles. Thus, it’s hard to gauge the significance right now with so much left to play out.

The substance: Shareholder loans (and how they fit into financial regulations) will be a big topic going forwards until there’s clarity on what sustainability rules look like going forwards. Broadly, though, the Premier League will be able to continue regulating APT deals.

The sad news: We’ve got years of these cases to come.

<Man City coverage ends>

Is there any Wander?

There will be some red faces amongst the great and the good of the European Club Association at their General Assembly in Athens this week when attentions turns to the matter of elections to the Board.

Failed Everton bidder Josh Wander's brief tenure in the illustrious company of Paris Saint Germain President Nasser Al-Khelaifi and Manchester City chief executive Ferran Soriano will come to a premature end, with his four-year term on the Board coming to a close three years early.

Rather than waiting until the meeting, the ECA has already removed Wander from their website.

Wander was elected to the Board 12 months ago as a representative of Standard Liège, but after being sacked along with his 777Partners co-founder last summer, the Belgian club have confirmed to the ECA that he will be leaving the Board. Wander's election to Subdivision Two of the ECA Board was queried by many clubs last year, as 777Partners were already under investigation in the United States at that point following allegations of fraud.

The proposed 777Partners takeover of Everton collapsed last summer and the entire company, which owns seven football clubs, asset management firms and an aviation business, is facing liquidation. Ironically the 777Partners' replacements as preferred bidder for Everton, AS Roma owner Dan Friedkin, is already on the ECA Board.

All eyes on Trent

A huge swing in leverage for Trent Alexander-Arnold’s agent this week, who might just have Liverpool over a barrel.

Real Madrid have been making noises for a while via their usual channels about signing the Liverpool man on a Bosman next summer while the Reds try and tie him down to an extension.

The heat just got turned up by a serious injury to Dani Carvajal, the long-serving right-back to whom Trent had been pegged as the successor.

"The dressing room is sad, and worried,” said Carlo Ancelotti post-match, just minutes after the stoppage time collision that sent Carvajal off in agony on a stretcher.

While the worst news was confirmed shortly afterwards, a tear to two ligaments and one tendon in his knee that will require major surgery, Madrid also announced that they had extended the veteran defender’s contract for a year until 2026. A rare touch of class.

They are, however, also now in the market for a January arrival per Madrid-based sports daily Marca.

With Liverpool trying to extend Alexander-Arnold as we speak, Madrid’s sudden urgency to fill the position has just handed a load more leverage to the full-back’s camp, knowing he could legally enter into pre-contract discussions as soon as January.

Extension talks have been described as open and ongoing, but Liverpool are also trying to tie down Jarell Quansah (a deal is close to being signed), Ibou Konate (a deal is expected to be signed), Mohamed Salah and Virgil van Dijk. Arne Slot teased news might be coming on those over the international break.

New technical director Richard Hughes inherited a lot of spinning plates when he took over in the summer. Trent’s situation might just have become the biggest of them.