Newcastle United will reportedly abstain from voting on financial regulations at the Premier League shareholders’ meeting on Thursday.
According to The Telegraph, the Magpies are distancing themselves from Manchester City’s legal battle against the league’s spending controls.
Man City launched a legal battle against the Premier League, demanding they abolish the Associated Party Transaction (APT) rules.
The APT rules were designed to prevent clubs from inflating sponsorship deals with companies linked to their owners, ensuring fair competition.
Newcastle have faced scrutiny for their £25 million-a-year front-of-shirt sponsorship deal with the Saudi Arabian events company Sela.
Sela is majorly owned by Saudi Arabia’s Public Investment Fund which holds an 80% stake in Newcastle.
Many people believed Newcastle would side with City to get the Premier League to remove the APT restrictions, allowing their owners to funnel money into the club.
However, Newcastle have chosen to be neutral despite the club’s previous strong opposition to tighter financial restrictions, particularly those regarding deals with associated parties.
Newcastle threatened legal action against the league over the proposed APT rules last season.
But they want to avoid being drawn into the escalating dispute between City and the Premier League.
The Cityzens have gone on the offensive, accusing rival clubs of attempting to stifle their success through discriminatory regulations.
City’s unexpected move will be settled in a private arbitration hearing starting next week.
The outcome of the case has pivotal implications for the future of financial controls in the Premier League.
A win for City will weaken the league’s ongoing case against the champions and stunt their ability to enforce spending regulations.
Despite their legal battle, City representatives are still expected to attend the shareholder meeting.
The Premier League also faces challenges from the Professional Footballers’ Association (PFA) regarding the proposed anchoring system.
