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The day the Premier League’s tensions over associated party rules became clear

The revolving doors to the five-star Nobu Hotel in central London were a conveyor belt of Premier League executives.

Karren Brady, vice-chair of West Ham United, was one of the early birds while Crystal Palace’s Steve Parish and Tony Bloom, chairman of Brighton, rushed in a few minutes late for the 10am meeting.

Just under two hours later, they started to file out, stopping for only the briefest of chats, after one of the tightest votes in Premier League history — on associated party transactions — that laid bare the tension between clubs in England’s top flight.

These rules are designed to stop clubs from signing inflated sponsorship deals with companies that are linked with them, as well as preventing clubs from moving on players for less or more than their market value to or from teams in the same ownership group. These two elements of the rules were combined in the vote on Friday, which led to some of the issues. The rules were brought in two months after the Saudi Arabia-backed takeover of Newcastle United in October 2021 but this was the first time they had been toughened up since.

It was squeezed through, despite the Premier League now facing the threat of arbitration from one of its own clubs, believed to be Manchester City. League chief executive Richard Masters told clubs this week of the potential legal battle with the club in question, who argue the rules are unlawful under English competition law. The Premier League insists this is not the case and they are compatible with English law.

It also speaks for the tension between City and the Premier League. City have been charged by the Premier League with 115 breaches of its financial fair play rules. Masters confirmed last month that a date had been set for a hearing on those allegations.

Any fresh legal battle with City will only add to the Premier League’s increasing caseload. The Athletic reported earlier this week the league has been forced to enlist extra legal help to try to get through several ongoing cases before the deadlines outlined in its own regulations.

(Michael Regan/Getty Images)

In yesterday’s vote, 12 clubs voted in favour and six against, with two abstaining.

One club who opposed the change told UK newspaper The Daily Telegraph the updated rules had gone through by the “skin of their teeth” and at the “second time of asking”.

Meanwhile, an executive at one of the Premier League’s London clubs told The Athletic they had voted for the motion as they helped create a more level playing field. An executive of a Premier League club that voted against the rules argued the split across the table over a 90-minute meeting underlined the struggles of Masters to command the room, while the Premier League would argue its chief executive is facing an unenviable and challenging task to reconcile 20 clubs who all have competing interests and agendas.

After the news filtered through from the meeting room on the hotel’s first floor, the Premier League tried to play down the idea of any tension or liveliness in the meeting, claiming it was all incredibly cordial despite the split vote. Clubs have attempted to place a veil of secrecy over the vote, with some club communications departments either ignoring messages from journalists regarding the issue or insisting they could not disclose or brief on the matter, while the Premier League centrally does not disclose how members voted.

Champions City are one of those clubs who voted against. The Athletic has also been told that Aston Villa were one of the abstainers, although the club were unresponsive when offered the right of reply on Friday. Crystal Palace also abstained. The decision to vote against related party transactions in November had frustrated John Textor, whose Eagle Football vehicle is the club’s largest shareholder. Textor is keen to use Eagle’s network to benefit each club within it (the other clubs are in France, Belgium and Brazil) by moving players where appropriate.

The vote came at the end of two days of meetings on a range of issues, which also included discussions on the league’s Profitability and Sustainability Rules (PSR) and the EFL ‘New Deal’ on revenue sharing.

On Thursday night, Lucy Frazer, the UK government’s secretary of state for digital, culture, media and sport, attended a dinner in London with Premier League club executives.

Yesterday’s vote went through after clubs previously failed to ban related-party loans during a Premier League meeting in November. A proposal back then to block wider affiliate transactions also fell short of the 14 votes required to pass. The clubs who voted against the proposals then were Manchester City, Newcastle United, Burnley, Chelsea, Everton, Nottingham Forest, Sheffield United and Wolves — all of whom have a multi-club model or hold stakes in other clubs. It is unclear how many of those clubs voted against this time around.

The Premier League said one of the reasons it didn’t go through in November was because of “personal liability to directors”, but that had been removed this time round.

Elsewhere in a briefing from the shiny corridors of Nobu, the Premier League said there was a real sense of momentum shifting towards reaching a new financial settlement with the EFL for its long-awaited ‘New Deal’. The idea of this is to redistribute more money across the football pyramid.

However, it stressed it was still not at the point of giving a formal offer.

This had been discussed in Thursday’s meeting of Premier League clubs, while there was also a dinner in London on Wednesday night involving representatives from 17 of the 24 Championships clubs and around half of the Premier League teams. There were no executive members from either league in attendance.

“A number of Premier League clubs held a productive meeting with EFL clubs this week to discuss these matters,” the league said. “To build on this momentum, conversations between clubs from the two leagues will now continue over the coming weeks. A good working session was also held on the design and implementation of a new financial system for the Premier League.”

(George Wood/Getty Images)

An EFL club director, who wished to remain anonymous to protect relationships, told The Athletic they believed they had a proposal in place in September — a lengthy presentation that came from the Premier League. Clubs were persuaded to accept it, and while several Championship sides were not happy, they had more than the 16 teams required to push it through.

But five months on from that, the EFL clubs are still waiting for the offer they can definitively say yes or no to. The same director added that the Championship clubs at the dinner on Wednesday were very consistent, while the Premier League clubs all have different interests and objectives. That get-together was viewed as helpful as it allowed them to make clear that they were still waiting for an offer.

At Thursday’s meeting, Premier League clubs had also discussed the current PSR regulations — although there was no vote on this. These rules allow clubs to have losses of £105million over three years and, as things stand, they will still be in place next season.

However, there were conversations on whether the league could move to become more aligned with the squad cost ratio system implemented by UEFA, European football’s governing body, and how that might work.

New UEFA rules limit clubs’ spending on wages, transfers and agents’ fees to 70 per cent of their revenue, although permitted losses over three years have risen to £50million (from £25m). This is being brought in gradually, with the percentage set at 90 per cent of revenue this season and 80 per cent in the next, before going down to 70 per cent in 2025-26.

Additional reporting: Matt Woosnam and Jacob Tanswell

(Top photo: Premier League CEO Richard Masters; Michael Regan/Getty Images)

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