Premier League cannot take action against the club for exceeding the relevant PSR threshold

[Matt]

14 minutes ago, FrankieADZ said:

The irony of the Premier League and EFL alike mentioning "upholding integrity" and the importance of "enforcing rules consistently to maintain the principle of fairness"  in their statements is incredible and quite simply, laughable.

 

Edited 4 September by Matt

[Pliskin]

The statement should read. 
 

“We apologise to LCFC for allowing our children to write up our policies”. 

[Ric Flair]

3 hours ago, st albans fox said:

This is interesting from the mockery today 

if they do manage to charge is to end June 24 then our sanction would be significant because whilst the loss may not be hugely above 83m, we haven’t been punished for the previous seasons breach.  hope we’ve done our sums right!

 

 

Does the ruling on 22-23 finances make a difference for 23-24?

Possibly, yes. This is pretty interesting. The EFL has a double jeopardy ruling, by which a club’s losses are capped if they have already been punished for a PSR cycle.

Let’s say City had been found in breach of PSR for the three-year cycle ending in 22-23 and had been punished for that. When the EFL then comes to assess the three-year cycle ending in 23-24, they would cap the losses for the first two of those three seasons, because essentially they’ve already been assessed.

In the Premier League, allowable losses stand at £35m per season. In the Championship, it’s £13m per season. Applying the double-jeopardy rule, the EFL would have capped City’s losses at £35m for 21-22 and 22-23, the first two years of the cycle they are assessing, and so essentially, they would be solely judging City on whether they exceeded the £13m allowable losses for 23-24.

That City have not been punished, it means the full three-year cycle will be considered and the club judged on whether they have exceeded the allowable £83m losses. Before City could have employed the double-jeopardy defence, but now don’t have that in their back pocket.

The EFL have not once handed over a case to the Premier League and vice versa. I presume because there's very little benefit to the league taking it over, it's time and money for something they would rather not have to deal with. 

 

Whether that incentive with us would now be different but if not, the most the EFL would be able to do is a deferred points deduction or a fine.

[UniFox21]

7 minutes ago, Matt said:

The irony of the Premier League and EFL alike mentioning "upholding integrity" and the importance of "enforcing rules consistently to maintain the principle of fairness"  in their statements is incredible and quite simply, laughable.

 

On the same day Chelsea were cleared for selling hotels to themselves is even more laughable

[Stadt]

You’d think there might be a bit of introspection from the leagues 

[Nolucklcfc]

So what can they actually do? 

[CrazyKopCorner]

The EPL and EFL are both a joke and selecting those clubs they feel they can enforce their nonsensical rules on - proper bully boys overseeing a totally ambiguous 2 tier system - fuch both of them 

[Ric Flair]

36 minutes ago, kenny said:

Leicester were charged for allegedly breaching Rule E.49 of the Premier League PSR regulations because their three-year rolling losses of £129.4m, up to the end of the 2022-23 season, were £24.4m over the allowed threshold of £105m.

 

Assuming the above is correct from the BBC website, we would need to find £24.4m of allowable deductions in that 3 year period. I would guess at the following being claimed:

 

£10m - final payments for construction of Seagrave

£5m per year towards the womens football team including the running costs of Belvoir Drive

£5m per year towards youth development

£1m per year for charitable donations

 

Total £43m. 

 

The above could be higher than these figures, so the assumption that we have breached has always been incorrect as haven't ever presented a case to the Premier League, hence it is referred as an alleged breach.

 

To add to the point of Simon Jordan, Stefan Borson is their football finance expert and his appearance last week he was sure that we were looking at big deductions. So it goes to show that all those that are convinced of the clubs position don't have a clue.

Isn't the £129.4m the amount after PSR deductibles have been taken off? Pretty sure I read our losses over the 3 years came to over £200m.

[Jimmy]

2 minutes ago, UniFox21 said:

On the same day Chelsea were cleared for selling hotels to themselves is even more laughable

I mean we have 2 training grounds King Power could buy from the club if needs be to fiddle the figures

[Muzzy_no7]

Premier League and EFL coming after us big time and media putting us under intense scrutiny meanwhile the PL give APPROVAL to Chelsea’s sale of the hotels to THEIR OWN company 😂😂😂.

 

Proper irritates me that we are getting hammered for this and yet Chelsea’s blatant money and player laundering will continue.

 

Villa literally avoided a large points deduction through stinky transfers involving Douglas Luiz and the two Juve players. 
 

Same with Newcastle and Forest and the transfers of the Greek keeper and Anderson. 

[urban.spaceman]

31 minutes ago, FrankieADZ said:

The EFL and the Premier League have demonstrably NOT acted in ANY good faith whatsoever.
 

They have repeatedly broken their own rules, acted outside their jurisdiction AND broken the law in their pursuit of us.

 

Both the EFL and the Premier League are anti-competitive, incompetent and corrupt.

[ElusiveEd]

They've never forgiven us for winning the Premier League

 

It wasn't in their remit to ever let a team like us win it.

 

How dare we!

Edited 4 September by ElusiveEd

[JimJams]

18 minutes ago, Nolucklcfc said:

So what can they actually do? 

Bend over.

 

 

Them, not you.

[Fox85]

I'm not being funny but hear me out.

 

The rules were written. There was a loophole and yes it happens this isn't Leicesters fault. 

 

Now because the rules were poorly written and this has happened this is the rules fault and nobody else's.

 

The 2 statements from the PL and the statement from the EFL is clearly stating that we still didn't follow the rules.

 

I can honestly see Leicester taking legal action over the PL and the EFL over slander and scrutiny following these statements that are fueling the media against the football club.

 

This could get very messy.

[ithuriel]

The PL are too weak and lets face it, bent, to really go after Chelsea, Man City etc., so they select what they consider easier targets to crack down on to look good in the media, Everton, Leicester etc., but being half arsed and anti competitive really does no one any favours, building a house of cards you better be damn careful where you blow.

[Groby_Blue]

We should certainly take action against the leagues. My wife wants to take action against them for the state of my pants for the last three months. 

[Foxdiamond]

Delighted Leicester exposed what a bunch of amateurs the Premier League and EFL are. Anyway I always think points deductions should be applied retrospectively. We got relegated anyway so tough. 

[kenny]

24 minutes ago, Ric Flair said:

Isn't the £129.4m the amount after PSR deductibles have been taken off? Pretty sure I read our losses over the 3 years came to over £200m.

I did wonder if the BBC had it wrong.

 

The reality is no one has seen our PSR calculation and I'm confident that the club will have submitted one that shows we comply.

 

I suspect that the PL will then argue that some of our claims are not valid or they disagree with the values hence the alleged breach.

[ClaphamFox]

2 minutes ago, Groby_Blue said:

We should certainly take action against the leagues. My wife wants to take action against them for the state of my pants for the last three months. 

Has that really got anything to do with the threat of a points deduction, though? 

[HankMarvin]

“OK, so why are they getting away with it? 

Good timing and bad drafting.

Under the league’s PSR regime, clubs are obliged to provide their calculations of their financial position for the relevant season by the end of March, which means they are estimates as the rules allow clubs to choose a financial year-end between May 31 and July 31.

Leicester, who were 17th in the table at the time, sent their PSR estimate to the league on March 28, 2023, with some “future financial information” following three days later.

On April 24, the club sent a modified version of their estimate but they also did something far more consequential at Companies House, the UK’s registrar of companies, where they sent a notification to say they were moving their usual year-end from May 31 to June 30, thereby adding a month to the 2022-2023 financial year.

Why? Well, some might say they did it to bring themselves in line with many other clubs. Some might suggest they did it to give themselves another month to sell players, like James Maddison, to bring themselves under the threshold. Some might speculate it is because they were nine moves ahead of the Premier League in a game of speed chess.

But we are getting ahead of ourselves. The season ended on May 28, with Leicester, Leeds United and Southampton relegated. As per the rules, those three were asked to transfer their shares in the league to a promoted team a few days later, with Leicester sending their golden ticket to Luton Town “on or around” June 13, more than two weeks before their new financial year-end.

We then fast forward to late February of this year, when Premier League clubs were meant to provide their audited accounts for the 2022-23 season for a final PSR assessment. Leicester wrote back, via their lawyers, asking why the Premier League wanted their accounts, as they were no longer members, and on March 1, as required under EFL rules, they sent their accounts to the EFL.

Over the next week, letters went back and forth between the club and the Premier League, with both claiming to be confused as to what the problem was. On March 15, Leicester sent a letter-before-action to both leagues, threatening legal action if either tried to charge them with a PSR offence for the 2022-23 season.

Two weeks later, on March 31, the Premier League picked up the gauntlet and charged Leicester, who immediately challenged its jurisdiction.

That brings us up to speed in terms of the timeline, which is clearly laid out in the appeal panel’s 22-page ruling. So let’s get into the rules.

The ruling starts by defining what a Club — yes, Club — is in terms of the Premier League rulebook, as Clubs are subject to the league’s rules for as long as they are members of the League. Again, the upper case is important, as we are not talking about any “association football club” or any league. This case is about Premier League Clubs and the League’s rules.

The panel then goes through the relevant sections of the rulebook, highlighting the sections on how relegated clubs must transfer their share in the league to promoted ones and the fact that clubs are allowed to choose one of May 31, June 30 or July 31 as their financial year-end.

We then get to a section on the PSR regime, which sets out how it works, before moving on to the Premier League’s “complaint” against Leicester and the first commission’s verdict on the jurisdiction issue.

This section is a bit complicated but can be boiled down to the appeal panel saying the commission decided to give the league the benefit of the doubt in terms of what the rules actually say about when clubs are members of the league or not, and base its decision on “intention” of the PSR regime.

From a legal point of view, the commission was effectively saying it is impossible — and not that important — to know at which point in the PSR cycle that Leicester went over the £105million threshold. The key point is that they clearly did and their overspending took place while they were a Premier League club.

Leicester, who were represented by every governing body’s worst nightmare, Nick De Marco KC — football clubs’ go-to lawyer in disputes of this nature — said this was nonsense.

“It is not only possible, it is obvious and it is necessary to determine the point of breach,” De Marco told the appeals panel. “It is how the rules work. The precise date of breach is clearly identifiable under the rules and it is crucial.

“It is the accounting position at midnight on June 30, 2023, if that is the account-ending period. It is that date and time only that is determinative of breach or not.”

Remember, Leicester officially stopped being a Premier League Club “on or around” June 13, when the share transfer to Luton was completed. And their financial year-end was June 30, 17 days after they joined the EFL. Seventeen days, the panel noted, in which Leicester could have sold another player or added another sponsor to bring them under the threshold.

Mic drop.

The league’s legal team tried to argue that everyone in football knows what the rules are for, who they should apply to and when they should come into force. It effectively made a “common sense” argument.

The appeal panel, however, took the view that the rulebook is a contract between clubs and the league and the wording of contracts matters. “The Rules are, in relevant parts, far from well drafted,” is the panel’s withering assessment of the league’s contractual work.

So, having tied up all the legal loose ends, the ruling concludes by saying “it follows” that the £105million loss threshold did not apply to Leicester when their PSR calculation “could be carried out and that LCFC was not in breach, and should not be treated to be in breach, of any rules”.

It added that it “appreciates that this conclusion has depended on the club’s adventitious decision” to move their year-end but it results “from the discrepancy between the requirement of Rule A.1.8 (the one about being able to choose a year-end) and the chronology in the PSRs… (which) seem to have have been drafted without taking Rule A.1.8 into account”.”

Edited 4 September by HankMarvin

[Corky]

I think we have been very fortunate but it is sounding like these leagues expected us to go "Yeah, ok, take what you want" regardless of whether there was room for us to successfully argue.

 

You give any club an opportunity to escape and they will take it.

[whoareyaaa]

The PL is a corrupt organization along with the refs they should just step out the picture and let clubs control there own business

[Groby_Blue]

8 minutes ago, ClaphamFox said:

Has that really got anything to do with the threat of a points deduction, though? 

Easier to blame the Premier League than pornhub....

[Pliskin]

Ultimately we’ve embarrassed the premier league…. So naturally they will be angry, as will a lot of the media connections who are heavily invested in the league. 
 

It just highlights that if you implement a policy, by god you have to ensure it is water tight, because if it isn’t, and it develops into a legal argument you’ll be exposed and it’s just plain embarrassing. 
 

What this has highlighted is that those who put these policies and procedures together and incompetent…. This is the premier leagues equivalent of walking out of the house and forgetting to get dressed.

[Mickyblueeyes]

Top from his director seat shouting to Enzo when we play Chelsea:

 

”I told you we weren’t lying you bald ****”