The Premier League may have good intentions in trying to curb over spending by clubs and level the playing field to some extent. However, clubs keep finding loopholes, most recently in the case of Chelsea and their women’s team.
The League then changes the rules (if it can get consent
from member clubs) but it is often a case of closing the stable door after the
horse has bolted. Fans of particular
clubs often feel they are being unfairly targeted while others get away scot
free.
We are still waiting for the result of the Manchester City case, but whatever it is, I anticipate further litigation. The real winners in these cases are the lawyers who charge fees that reflects their expertise and their ability to deliver results off the pitch. The Premier League continues to insist that there is no case for an externa; regulator while failing to put its own house in order (and the EFL is no better).
The Premier League has moved to tighten its financial rules
amid an ongoing arbitration dispute with Leicester City. The wording around its
profitability and sustainability rules (PSR) has been amended in the latest
rule book and appears to directly relate to the arbitration case centring
around Leicester’s losses during the three-year accounting period ending in
2022-23 and whether it fell under EFL or Premier League jurisdiction.
On January 14, the Premier League said no clubs had
been charged with a PSR breach, but that Leicester were still at risk of a
possible sanction. The Athletic had reported the week before
that rival clubs expected Leicester would be in breach. A verdict is yet
to be publicised.
The rules were amended at a recent meeting of Premier League
clubs with the league’s handbook — where the English top flight’s rules and
guidelines are outlined — updated last week. Among several new rules relating
to promoted clubs and the limits on their losses, the below rule E.49 has been
added.
It states: “If a club is relegated from the league, that
club shall, notwithstanding relegation, remain bound by Rules E.47 to E.86 as
if it were still a club, until such a time as it has complied with all of its
obligations relating to all its obligations to its last season as a club.” This confirms that clubs are still under
Premier League jurisdiction until they have satisfied everything under the
rules for the season in which they were relegated.
It remains unclear whether or how these changes will impact
the Leicester case. However, whenever the Premier League changes its rules,
they cannot be applied retrospectively and are only enforceable from the date
they were amended.
The change strengthens the Premier League’s hand in pursuing
charges against relegated clubs it believes have breached PSR. The wording
largely mirrors that enacted by the EFL, reducing the scope for clubs to
manoeuvre between the divisional gaps in the way Leicester managed previously.
As for Leicester, the change represents a worrying shift in
the regulatory landscape. The EFL is already expected to be readying charges
for if – or when – the club is relegated back to its jurisdiction. This change
to the 2024-25 rules also means the club’s loss limit for the current
three-year PSR cycle is set at £83m – and confirms the club could be punished
by the Premier League if they breach that limit, even if they are relegated.
Leicester won the initial case in September but the Premier
League has appealed against the ruling and that case is still going on —
it means the club could still be charged for new alleged PSR breaches for last
season depending on the outcome.
Nick De Marco, the KC who led the club’s legal action, was
scathing about the league’s rules. He
wrote on the LawInSport website in September: “One might hope more care shall
in the future be taken in the drafting (and review) of such rules [and] that
the PL, in particular, having been embroiled in so many expensive and
distracting recent legal disputes about its PSR rules will carefully consider,
and should not rush into, any new proposed financial regulatory rules.”
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