Premier League clubs are preparing to rally around chief executive Richard Masters at an emergency shareholders' meeting next week.

The meeting has been called to discuss the fallout of an arbitration tribunal which declared that some of the Premier League's financial rules were unlawful and procedurally unfair.

Manchester City had challenged the legality of the associated party transaction rules after they were tightened following a vote of the 20 member clubs in February.

"There is no civil war and most clubs are still backing Richard," one club owner said. "The majority of us want to keep the rules but we accept they now need to be changed."

In a 175-page report published on Monday, the tribunal found the APT rules were unlawful because they did not cover loans made to clubs by shareholders. The tribunal also determined that the Premier League should set aside its decision to block two lucrative new City sponsorship deals with Etihad Airways and First Abu Dhabi Bank.

City's general counsel Simon Cliff sent a strongly-worded email to the Premier League and the other 19 clubs on Monday claiming the league's summary of the tribunal's report was "misleading".

The APT rules were introduced in 2021 to stop clubs boosting their revenue by signing inflated commercial and sponsorship deals with companies connected to their owners and shareholders.

City believe all the APT rules are now void following the tribunal's findings while the Premier League says the panel of three retired judges "endorsed the overall objectives, framework and decision-making of the APT system".

The league thinks it can quickly comply with competition and public law by changing the existing rules but City have warned against such a course of action. "This is the time for careful reflection and consideration by all clubs and not for a knee-jerk reaction," Cliff wrote in his email. "Such an unwise course would be likely to lead to further legal proceedings with further legal costs."

Next week's meeting is likely to see the 20 clubs divide into the same groupings which lined up behind City or the Premier League at the two-week arbitration hearing in June. Chelsea, Newcastle United and Everton acted as witnesses for City in the hearing while the Premier League were supported by Arsenal, Manchester United, Liverpool, Tottenham, Brighton, West Ham, Brentford, Bournemouth, Wolves and Fulham.

Meanwhile, Etihad Airways have denied that they paid City too much in sponsorship deals in order to help the club and its Abu Dhabi owners. "Etihad doesn't do any transactions with any partner that is not on the market basis," Antonoaldo Neves, Etihad chief executive, told Sky News. "We have an amazing governance in Etihad."

Etihad is ultimately owned by the Abu Dhabi sovereign wealth fund ADQ.

The hearing into City's alleged 115 breaches of the Premier League's financial rules is continuing at the International Dispute Resolution Centre in St Paul's.