Third party transactions restrictions was the trump card for the Premier League big six.
A key way to make it all but impossible for Newcastle United to grow, despite now having ended 14 miserable years of zero ambition with Mike Ashley, who instead had taken all the benefits for his own personal profit.
FFP restrictions had already helped end many of the more straightforward routes that had previously been central to Chelsea and Man City making it a Premier League big six.
Now the Premier League big six acting together (Man City dragging their heels compared to the other five….) quickly forcing through new rules on related party transactions, ASAP after the Saudi Arabia PIF led takeover of Newcastle United in October 2021.
The Premier League big six thinking it was job done, with January 2022 seeing new regulations that stated each Premier League Club must now submit to the Premier League details of third party transactions to which a payment, fee or value in kind is or will be provided to the Club, where the total value is over £100,000 per annum, subject to exceptions which include the sale or loan of a player’s registration.
Basically, to try and compete with the Premier League big six, any sponsorship deal that NUFC wanted to make with any business that had any connection to any of the Newcastle United owners, they would have to prove it represented ‘fair market value’…
As Newcastle United fans we all knew / know the value of our club, you simply had to look back to the Premier League story BEFORE Mike Ashley came in, the value for outside businesses if they associated themselves with NUFC.
However, what the new NUFC owners inherited was commercial revenues that were the same level as when Mike Ashley bought the club in 2007. Terrible cheap as chips deals such as the £6.5m a year with FUN88 for front of shirt sponsorship, no doubt a similarly shocking deal with Castore.
Even worse, Newcastle United had an owner who for almost a decade and a half asset stripped the club, taking all the benefits for himself. Filling St James’ Park and everywhere else at the club with embarrassing levels of Sports Direct advertising that Newcastle United didn’t receive a penny for, year after year.
As an extreme example, if the new NUFC owners did go down the route of say having a company pay to have St James’ Park sponsored, what would be the starting point of justifying whatever deal Newcastle might attract (from somebody deemed to be a related party)?
How much did the last stadium sponsor pay for St James’ Park?
The answer of course is £0. Yes, Mike Ashley awarded this to Sports Direct for nothing.
Whatever the potential rights and wrongs now with Newcastle United moving forward, it is quite shameful that nobody in football, at the Premier League, in the media, pundits and presenters etc, raised any concerns about what Mike Ashley was doing for some 14 years.
Imagine the hell on there would be in the media if say Joe Lewis renamed Tottenham’s stadium with the name of one his business interests, then filled the ground with adverts for his businesses, then didn’t allow a penny to be put into the club for those massive benefits these ‘related parties’ were getting???
Anyway, back to the Premier League big six and their cunning plan on related party transactions that would wreck Newcastle United chances of competing.
Well here’s an update.
Premier League big six defeated on related party transactions and Newcastle United are now free to act.
Those hastily brought in PL regulations are still there on related party transactions BUT they are now meaningless, at least for the foreseeable future, in terms of impact on Newcastle United.
As somebody stated in the past 48 hours…
‘If only the Premier League big six had put as much effort into stopping Newcastle United on the pitch, as they have done off it!’
Yes, Eddie Howe and the Newcastle United owners / hierarchy have completely smashed it.
The whole related party plan relied basically on this.
Newcastle United have say a Saudi based sponsor (not that surprising anyway, considering this is where Saudi Arabia PIF do their core business!!!) willing to pay ££££ for front of shirt sponsorship.
The Premier League big six inspired new regulations and vetting committee etc then say ‘hold on, you can’t expect to get this ££££ per year when the likes of Tottenham (Chelsea, Liverpool etc) get less than that, no way you should even be allowed the £££ that one or more of these Premier League big six clubs get, you are entitled to ££ at best and you should be grateful for that, as actually who are you to be thinking yourself anything special, on second thoughts, £ is what you will be allowed.’
The big weakness in all of this of course, was Newcastle United’s then current status. Those previous deals that had been in place under Mike Ashley and the lack of success on the pitch that had gone hand in hand.
Qualifying for the Champions League has smashed that open completely.
A bit like the go-to top nightclub in town and walking straight up to the VIP entrance, the doormen stopping you, but one flash of your VIP level Champions League card and you are waved immediately through.
The Premier League big six and their lapdogs on the vetting committee are knackered now.
Newcastle United walk up to the VIP entrance with their latest lucrative sponsorship deal, regardless of whether it is with a related party, what can the PL vetting committee say?
Unless it is something really off the scale, there is no way they can knock it back, the Newcastle United legal team would be all over them in a seriously embarrassing incident (yet another) for the Premier League.
If Newcastle United are simply looking at similar level deals with what the likes of Tottenham, Chelsea and Liverpool currently have, then how on earth can they be blocked.
I think it has been only three Newcastle United matches so far in 2023 that haven’t been picked for UK live broadcast AND now any new NUFC sponsor is going to get Champions League level coverage on top of that, with all the extra benefits that this brings.
Replica shirt sales are going to be heading back to the kind of ranking Newcastle United had when Kevin Keegan was in charge and Adidas couldn’t get enough of us.
A bit like a good old fashioned castle siege, the Premier League big six relied on keeping Newcastle United out for as long as possible, if they could do it for the first few years then it could well be mission accomplished long-term as well. However, in their first full season, Eddie Howe and the NUFC owners have marched up and simply smashed down the main gates at the castle, we are now charging through the breach and the (Premier League big six) inhabitants are running for their (privileged football) lives.