The richest league on earth is tearing itself apart

The document that changed the course of English soccer—and by extension global sports—was initially written by hand on a single sheet of paper back in 1990.

Known as the Founders’ Agreement, it became the charter of a brand new venture called the Premier League. And over the next three decades, it would help turn the top tier of English soccer into a media and entertainment behemoth. At its heart was a simple premise: the member clubs could be mortal enemies on the pitch, but the rest of the time they would all be inseparable business partners.

Now, for the first time, that bedrock is threatening to crumble.

Everywhere the Premier League looks, clubs are in open revolt. Manchester City, which has won six of the past seven championships, is appearing before an arbitration tribunal this week to challenge league rules on sponsorship agreements. This comes on top of a pending case against City alleging 115 breaches of the Premier League’s rules on spending and financial disclosure, which could result in vacated titles and points deductions.

Everton, meanwhile, has already suffered the first points deductions in Premier League history for overspending—twice this season, in fact—and has accused the league of unfair treatment. Nottingham Forest has also challenged the league’s authority by claiming that referees were biased against them, prompting an investigation from the English Football Association. And Wolverhampton Wanderers were so incensed by on-pitch decisions going against them that the club introduced a motion to scrap Video Assistant Referees.

But in this storm, the City case represents the single largest challenge to the Premier League’s authority. Never before has a single club risen up against the other 19 and attempted to fundamentally alter the Founders’ Agreement. Yet here is City, the former sad-sack team that turned into a juggernaut after being acquired by a member of Abu Dhabi’s royal family in 2008, hoping to do away with the requirement that 14 of the 20 clubs agree on any prospective changes to Premier League rules.

In its filing, City decried the league’s one-club, one-vote structure as a “tyranny of the majority,” according to the Times of London, which revealed the suit last week.

Until now, no club had dared to question the Founders’ Agreement, which is arguably the most consequential text in global soccer since the Laws of the Game were drawn up in the back of a London pub in 1863. The charter, which formalized the breakaway of England’s top clubs from the structure which had existed for more than a century, transformed a dusty concern made up of local business owners and self-made men into a playground for global billionaires. American investors, Russian oligarchs, and Gulf sheikhs were all drawn by its worldwide reach and its willingness to roll out the red carpet to the highest bidder.

That is what drew Sheikh Mansour bin Zayed Al Nahyan to invest in City in 2008. Over the years that followed, the club spent billions assembling one of the deepest squads in soccer history. They didn’t do it to finish in second place.

Tensions had been simmering between City and its rivals ever since the Premier League began trying to impose measures that are more familiar to American sports than the free-for-all that exists in English soccer. Those include various proposals for spending caps, greater oversight, and hard limits on debt. (It’s no coincidence that around half the clubs in the Premier League now have U.S. owners, who are used to operating in the more rigid structures of American sports and support more financial controls.)

But the rule City is arguing against this week is one that the founders of the Premier League might never have imagined was necessary thirty years ago. Officially, it is called a ban on “associated party transactions.” What that does in practice is limit the ability of sponsors who are also connected to or controlled by a club’s owners from pouring in money as a way of skirting spending regulations.

In Man City’s case, the club has faced allegations that it deliberately overvalued sponsorship agreements with companies such as Etihad, Abu Dhabi’s flagship airline whose name is plastered across the team’s jerseys and its home stadium. City has always denied wrongdoing. This is expected to be resolved long before any verdict on the other 115 charges.

In the meantime, these legal fights haven’t slowed the City machine on the field. Last month, it clinched an unprecedented fourth straight Premier League title. And manager Pep Guardiola doesn’t feel that his records in England are in any danger of being scrubbed out.

“What’s going to happen is going to happen,” he said this season. “In this moment, we are innocent until it’s proven.”

Write to Joshua Robinson at [email protected] and Jonathan Clegg at [email protected]