According to a sports expert, Everton and Nottingham Forest “may seek compensation” from the Premier League.

Both Man City and the Premier League said they won after APT rules on a court case.

A sports lawyer says that Everton could sue the Premier League for money after Manchester City’s famous case.

After the court case, both the city and the governing group said they had won. The team from Etihad Stadium had two advertising deals turned down because of rules about Associated Party Transactions (APTs). APT rules say that clubs can’t get too much money from deals with owners that are too good to be true.

But City was able to make a strong case that shareholder loans, which are often given at no or very low interest rates, should not be exempt from APT rules and that they were “at odds with the whole rationale” of the Premier League’s profit and sustainability rules (PSR).

For two different breaches of PSR last season, Everton lost eight points and Nottingham Forest lost four points. Everton has £451 million in shareholder loans.

In December 2021, APT rules took the place of Related Party Transactions (RPT). This was done because the Saudi Arabia Public Investment Fund bought Newcastle United. And if the Premier League went back to RPT, Stevie Loughrey, a partner at the sports law company Onside Law, thinks that Everton might sue for money because they were punished “under an unlawful regime.”

This is what Loughrey told The Athletic: “The exemption of shareholder loans was Manchester City’s big win on competition law, and the possible impact is very significant.” The Premier League will have to change its rules to make it clear that company loans are allowed. It’s still not clear if this is from December 2021, when the new APT rules went into effect, or just from now on.

“If the APT rules aren’t valid and we go back to the RPT rules, then it looks like shareholder loans will need to be taken into account starting in December 2021.” The Premier League board may need to go over all of its decisions about APTs made since December 2021 again.

“Furthermore, it’s easy to see how clubs like Everton and Nottingham Forest could say they were punished in a way that was against the law and ask for compensation for that.”

One partner at Mishcon de Reya who specializes in sports law agreed. He said, “On the one hand, the Premier League may try to stick to the current rules and rely on what is known in the legal world as the “blue pencil test.” This is where they would basically argue that the rules should be read so that they are automatically reinterpreted in a legal way, but it looks like Manchester City would strongly challenge this,” says Leaf.

“I’m sure City would try to say that the APT rules are illegal and can’t be enforced until formal changes to the rules are voted on and agreed upon by all the other Premier League clubs.” I think City might even try to say that the APT rules can only now work if the shareholder loan calculation is applied retroactively. This is likely to be problematic for the Premier League because many clubs will be against this and may even try to challenge a rule change themselves.