Manchester City have reportedly won their legal battle against the Premier League over its Associated Party Transaction (APT) regulations.

The rules, which have been in place for almost three years, are designed to limit the amount associated parties can pay clubs in sponsorship deals. However, a new ruling has sided with City and deemed the league’s regulations unlawful in their entirety.

Manchester City took the Premier League to court over the regulations after proposed deals with Etihad Airways and First Abu Dhabi Bank were blocked in 2023. The club argued that the restrictions on commercial agreements were unlawful.

A tribunal ruled in City’s favour in September last year, and an independent panel has now reportedly upheld that decision. According to The Daily Mail, the verdict could pave the way for a series of compensation claims, potentially plunging the competition into crisis.

The APT rules were introduced to prevent the wealthiest clubs from artificially inflating sponsorship agreements with companies linked to their owners. In November, the 20 Premier League clubs voted to amend the regulations, with a majority of 16-4 in favour of the changes.

However, the latest ruling from a panel consisting of legal experts Christopher Vajda KC, Lord Dyson, and Sir Nigel Teare means that any sponsorship deals rejected or reduced in value between December 2021 and November 2024 could now be subject to substantial compensation claims.

As per The Daily Mail’s report, clubs that believe their on-pitch performance was negatively affected by the previous system may now seek legal action.

Manchester City are also understood to have launched a legal challenge against the amended APT rules introduced last November. Should the panel reach a similar verdict and deem those regulations unlawful, the Premier League could face serious repercussions.