An eight-club coalition of Chelsea, Manchester City, Newcastle United, Everton, Nottingham Forest, Sheffield United, Wolverhampton Wanderers and Burnley has defeated a temporary Premier League loan ban between clubs with the same owners.
The Premier League has asked clubs to introduce a change that would ban loans into the league this January, as it seeks to draft new rules to deal with loans and multiple club ownership.
In private talks with 20 clubs, the Premier League asked for extra time to deal with the issue of clubs loaning players from partner clubs. Although a majority of 12 people voted in favor, it did not reach the required 14 threshold.
In a separate vote, clubs also rejected new changes to toughen so-called related party transactions, which regulate commercial deals agreed between clubs and external companies. It is understood 13 clubs voted in favour, one short of the required majority. Burnley changed sides in this vote. These rules would place much more personal responsibility on directors.
Telegraph Sport understands Chelsea chairman Todd Boehly and Manchester City’s legal chief Simon Cliff, who was one of his club’s representatives at the shareholders’ meeting, spoke in favor of a temporary moratorium on denying loans.
The rules governing players’ loans between clubs in the same multiple ownership group have been proving challenging to draft and the Premier League wanted to ban this from happening this January while potential rule changes are discussed. If a loan does not involve a permanent transaction, fair market value rules do not apply. The problem requires a major change in the way the system is managed.
This is also an issue facing UEFA, which is concerned that, for example, a club eliminated from the Champions League group stages could loan its best players to a partner club in the Europa League knockout stages.
Boehly’s consortium, which controls Chelsea and is also led by Clearlake Capital private equity investor Behdad Eghbali, now also owns Ligue 1 club Strasbourg. Newcastle’s main owners, the Saudi Public Investment Fund (PIF), also own four clubs in the Saudi Pro League. Manchester City is part of the 12-man global City Football Group. Nottingham Forest owner Evangelos Marinakis also owns Greek giants Olympiakos and is said to be in talks with Portuguese side Rio Ave over potential investment.
Among the remaining rebels, Everton are the subject of a proposed takeover bid by US group 777 Partners, which runs an extensive multi-club ownership strategy in Europe and South America. The aims of Wolves, Sheffield United and Burnley are less clear. Burnley’s US owner Alan Pace has allegedly been linked with buying a club in Belgium. Sheffield United is in Saudi hands.
Executives from the 12 clubs backing the reforms have privately expressed surprise that injury-hit Newcastle have effectively been given the green light to do business with other PIF-owned entities this January.
Newcastle director Amanda Staveley smiled but declined to comment as she left a meeting of 20 clubs after the bids were rejected.
The club, whose Saudi Arabia-backed £305 million takeover was completed in October 2021, had been linked with the transfer of Ruben Neves from Al-Hilal. Sources close to Newcastle have shown no interest ahead of Tuesday’s meeting, but the vote is undoubtedly a huge boost as the club plans reinforcements following injuries and Sandro Tonali’s 10-month ban from football for breaching the rules.
The loan ban has been proposed as an interim measure until a concrete solution can be agreed before the summer transfer window. Related party transaction rules already apply to some extent when transferring players on permanent deals. Newcastle had to show the Premier League that they had achieved fair market value by selling French winger Allan Saint-Maximin to another PIF club, Al-Ahli, in the summer.
The Premier League defines a related party as “an organization that has material influence over the club or is within the same group of companies as the club”.
The competition first began moving two years ago to close any existing loopholes to stop the Saudi regime in Newcastle succeeding in a buyout like their city-owning counterparts did more than a decade ago.
Calls for restrictions on owner-funded sponsors follow allegations first made about Manchester City’s Roberto Mancini during the Football Leaks scandal. It is claimed that Mancini, who led City to their first Premier League title in 2012, was paid a salary in addition to his salary as a consultant at Al Jazira Sports and Culture Club, which is controlled by City’s Abu Dhabi owners. The club and the Italian manager have previously refused to comment on the veracity of claims that Mancini was paid in addition to his salary as a consultant at Al Jazira Sports and Cultural Club, which is controlled by City’s Abu Dhabi owners.
Further disputes between clubs over the New Deal arose as managers met in a London hotel just days after Everton were deducted 10 points for spending breaches.
As detailed by Telegraph Sport on Sunday, there is no agreement on how much the so-called big six contribute to the £130m-a-year New Deal compared to smaller clubs. There is also some disagreement over whether clubs should be allowed to exceed their spending limits immediately after relegation to the Championship.
The Everton saga was not discussed at the meeting, but it was revealed on Tuesday that the same commission that penalized the club on Friday will now hear rival clubs’ upcoming applications for compensation. Burnley, Leicester City, Leeds United, Southampton and Nottingham Forest have expressed interest in taking legal action and have 28 days to make a request. David Phillips KC, Judge Alan Greenwood and West Ham United’s former financial director Nick Igoe will then decide whether the clubs are entitled to payments estimated to total up to £200 million.