EFL Analysis can exclusively reveal the implications of Leicester City’s latest blow after they were charged by the Premier League with an alleged breach of profit and sustainability rules in relation to the 2023/24 season.
Although Leicester were in the Championship at the time, John Percy of the Telegraph revealed that the Foxes had received a charge and have been referred to an independent commission after facing three charges for the season – despite winning an appeal over charges relating to the 2022/23 season.
It comes just weeks after the Foxes’ Premier League fate was sealed and shortly after club legend Jamie Vardy announced he would be leaving Leicester.
Photo by Catherine Ivill - AMA/Getty Images
Photo by Catherine Ivill – AMA/Getty Images
Finance expert reveals if Leicester City will get a points deduction
EFL Analysis finance expert Adam Williams revealed that the charge isn’t similar to the one that saw Sheffield United deducted two points at the start of this season and is more comparable to Everton’s scenario from last season.
Explaining the outcome, Williams revealed that Leicester will almost certainly be hit with a big points deduction.
He said: “The charge is for the three-year PSR assessment window up until the end of 2023-24, Leicester lost £202m during that period.
“Even allowing for PSR-exempt expenses like academy investment and women’s and youth team spending, it’s not hard to see why they have breached that allowable loss cap.
“For Premier League clubs, that cap is £105m over a rolling three-year period, but it reduces for each year you spend in the Championship. For Leicester, it would have been £83m in 2023-24, so you can see how the margins are even tighter.
Infographic explaining PSR (Profit and Sustainability Rules) for the Premier League, EFL Championship, and UEFA competitions
PSR infographic Credit: EFL Analysis/GRV Media
“The Premier League and the EFL have cooperated to close the loophole that Leicester used last time, where they argued that because they had been relegated before the financial year-end, the league didn’t have jurisdiction to punish them.
“Given that their alleged breach appears to be in a similar ballpark to Everton’s, I wouldn’t be surprised if it’s a similar points deduction that they go for, especially given that Leicester are also charged with not providing their accounts on time and failing to give their full assistance to the Premier League.”
Williams continued by adding: “They got off on a technicality last time, so it’s hard to see how they can do the same this time around given that the problem with the Premier League and EFL’s rules has ostensibly been addressed.
“You can use Sheffield United’s two-point deduction as a benchmark in the EFL, but that is separate because it was related to late payments to clubs, not a numerical breach of the PSR threshold.”
An infographic which details Leicester City's pre-tax profit and loss from recent years
Leicester City profit and loss chart Credit: Adam Williams/EFL Analysis/GRV Media
What have Leicester City said about the latest PSR charge?
A statement on the club website has confirmed that Leicester “intends to engage cooperatively” with the process and “will not be able to comment further on these proceedings until they are concluded”.
They said: “The Club is pleased that it successfully defended the Premier League’s challenge to the Appeal Board decision in relation to the PSR assessment period ending FY23, which was the main focus of these proceedings.
“The Premier League’s own rules provide a deliberately high threshold for any challenge to the decision of an Appeal Board. In this case, the Appeal Board’s decision was only capable of being overturned if it could be shown to have resulted from a “perverse interpretation of the law” or was a decision “which could not reasonably have been reached”.
“The Appeal Board decision was reached by a highly experienced panel (including two former Court of Appeal judges) and, although the tribunal may have disagreed with the decision, it dismissed the Premier League’s challenge, finding (consistent with the arguments made by the Club all along) that the Appeal Board decision “could not sensibly be seen as resulting from a perverse interpretation of the law”.
“The tribunal also concluded that the Premier League was successful in establishing jurisdiction on one of the two grounds argued by the Premier League with respect to the assessment period ending FY24, and the Premier League has now referred this to an independent Commission. Consistent with its previous commitments, the Club intends to engage cooperatively in this matter now that the Premier League’s jurisdiction has been established for the period ending FY24. However, we will not be able to comment further on these proceedings until they are concluded, due to their confidential nature”.