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Friday has seen the 20 Premier League clubs meet in London.
Top of the agenda was a vote on amendments to Associated Party Transactions (APTs).
Manchester City had urged clubs to vote against them.
With Aston Villa coming out in support and Manchester City hoping other clubs would do the same.
Now an official release (see below) from the Premier League has revealed the result of that vote…
Premier League official announcement – After vote on amendments to Associated Party Transactions (APTs) – Friday 22 November 2024:
‘At a Premier League Shareholders’ meeting today, clubs approved changes to the League’s Associated Party Transaction (APT) rules.
The amendments to the rules address the findings of an Arbitration Tribunal following a legal challenge by Manchester City to the APT system earlier this year.
The Premier League has conducted a detailed consultation with clubs – informed by multiple opinions from expert, independent Leading Counsel – to draft rule changes that address amendments required to the system.
This relates to integrating the assessment of Shareholder loans, the removal of some of the amendments made to APT rules earlier this year, and changes to the process by which relevant information from the League’s “databank” is shared with a club’s advisors.
The purpose of the APT rules is to ensure clubs are not able to benefit from commercial deals or reductions in costs that are not at Fair Market Value (FMV) by virtue of relationships with Associated Parties. These rules were introduced to provide a robust mechanism to safeguard the financial stability, integrity and competitive balance of the League.
Shareholder Loans
– The new rules seek to ensure that there is appropriate parity between the treatment of shareholder loans and other APTs going forward, with transitional rules clarifying the treatment of existing shareholder loans within that framework.
– Shareholder loans entered into after [effective date] will be required to be submitted as an APT and subject to an FMV assessment. If the Premier League Board determines the loan to evidently not be at FMV, the club in question shall be required to terminate or vary the loan to reflect FMV and pay any identified shortfall in interest.
– Any Shareholder loan that was entered into before [effective date] and which is replaced with other forms of financing (e.g. by way of conversion to equity or repayment) within 50 days (i.e. by 11 January 2024) will not be required to be submitted as an APT or assessed for FMV.
– Any Shareholder loan that was entered into after 14 December 2021 but before [effective date] and remaining in effect on 11 January 2025 must be submitted as an APT. If the Premier League Board determines the loan is evidently not at FMV, the club is permitted to retain the Shareholder loan on its existing terms, though adjustments must be made to its Annual Accounts for 2024/25 onwards as if, from [effective date], the loan was at FMV.
– Any Shareholder loan that was entered into prior to 14 December 2021 and remaining in effect on [11 January 2025] must be submitted as an APT and be subject to an FMV Assessment upon any drawdown taking place after the [effective date]. If the Premier League Board determines the loan is evidently not at FMV, the club is permitted to retain the Shareholder loan on its existing terms, though adjustments must be made to its Annual Accounts for 2024/25 onwards as if any drawdowns made after [effective date] were at FMV.’
