Both City and the league claimed victory on Monday afternoon following an arbitration panel’s ruling that Associated Party Transaction rules are a required piece of governance but some elements of the current regulations are unlawful.
Yet the panel’s decision, communicated to clubs via a 175-page report, has dragged Arsenal and Brighton among others into the saga because of an argument over loans from owners and shareholders.
"Those incentives could result in a material distortion, given that £1.5bn out of £4bn total borrowings (some 37%) are made to clubs by shareholders, including all of Arsenal’s borrowing and almost all of Brighton's borrowing."
And that is likely to make next week’s board meeting of clubs, which will discuss plans for reworked APT rules, all the more awkward.
The Premier League said "these elements can quickly and effectively be remedied by the league and clubs” - but it remains to be seen how the reworked APT will look.
It has been suggested that if shareholders are to lend money to their clubs in future they will need to carry interest rates comparable to standard lenders (presently 8-10%) and that will greatly impact clubs’ standing when it comes to Profit and Sustainability Rules.
However loans previously agreed are likely to remain untouched because there appears no precedent for new rules to be applied retroactively.
So instead of Arsenal paying future interest on pre-existing borrowing - which as of the end of 2023 was £259m - they are more likely to be blocked from receiving new loans from the club’s owners.
That adds another layer to a rivalry between the clubs that came close boiling over last month following a heated 2-2 draw. An added complication for the Premier League is that for any new rule to be implemented 14 of its clubs must be in favour.
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