The Premier League clubs have voted in favor of legislation that is designed to prevent the Saudi Arabia owners from finishing money-spinning sponsorship deals in a 20-club meeting on Monday.
Newcastle slammed the legislation saying that rule change, which will temporarily ban commercial arrangements that involve pre-existing business relationships, was anti-competitive.
The team was represented by Lee Charnley, the incumbent managing director, rather than Amanda Staveley, the director, and minority stakeholder, who is now responsible for running the club on a day-to-day basis.
Charnley has made it clear that his club had legal advice to say that the amendment was unlawful.
However, the other PL clubs pressed on for the vote and it was passed with 18 votes in favor and only Newcastle against.
Manchester City abstains
Manchester City abstained from voting for the legislation and it is believed that they did so on the basis of legal advice that the process was unlawful. Abu Dhabi United Group-owned Manchester City has had deals that are known as related party transactions. An example was the one that saw Etihad Airways, the Abu Dhabi government-owned carrier, sponsored them.
Many of the clubs in the Premier League are worried that Newcastle’s Saudi owners might conclude deals in the oil-rich kingdom which could give them an advantage. The clubs want pre-emptive measures to be put in place that would either prevent this or ensure that fair market value was paid.
The rule will be in force for the next month and it will apply to all 20 clubs but many of the participants desired something similar to become a permanent rule. A working party is to be set up – comprising a cross-section of clubs – to investigate what, if any, changes should be made. Newcastle has been asked whether they would like to be on it.
Following the Newcastle takeover, the 19 other clubs held a special meeting, wanting to understand why the deal had been signed off. That meeting took place last Tuesday, with some clubs attending in person at the league’s Paddington HQ and others dialing in via conferencing software.
