The tribunal also found that the rules were discriminatory in how they operated because they deliberately excluded shareholder loans.
Manchester City Football Club has won its legal battle with the Premier League over the Associated Party Transaction rules.
Reacting in a statement on Monday following the favourable ruling, Manchester City expressed gratitude to the members of the Arbitral Tribunal for their work and considerations and welcomed the findings.
“The club has succeeded with its claim: the Associated Party Transaction (APT) rules have been found to be unlawful, and the Premier League’s decisions on two specific MCFC sponsorship transactions have been set aside.
“The tribunal found that both the original APT rules and the current (amended) APT rules violate UK competition law and the requirements of procedural fairness,” the statement said.
The tribunal criticised the Premier League for its application of the APT rules, stating that the rules were structurally unfair and that the league was specifically unjust in how it applied those rules to the club in practice.
This resulted in specific decisions by the Premier League regarding Manchester City’s sponsorship transactions being set aside.
The tribunal also found that the rules were discriminatory in how they operated because they deliberately excluded shareholder loans.
The statement added, “As well as these general findings on legality, the tribunal has set aside specific decisions of the Premier League to restate the fair market value of two transactions entered into by the club.
“The tribunal held that the Premier League had reached its decisions in a procedurally unfair manner.
“The tribunal also ruled that there was an unreasonable delay in the Premier League’s fair market value assessment of two of the club’s sponsorship transactions, and so the Premier League breached its own rules.”