Leicester City Win Their Appeal Against Alleged Breach of Premier League PSR

Newly promoted Leicester City have avoided the prospect of points deduction, as an independent panel declared the Foxes not guilty for the alleged breach of Premier League’s PSR rules.

For the majority of the summer, a dark cloud loomed over Leicester City’s head. The prospect of a looming points deduction meant that fans of the club couldn’t fully celebrate their promotion to the Premier League. However, the East Midlands club has now won an appeal, which will all but guarantee that they aren’t handed a points deduction this season. The Premier League is unlikely to appeal this decision because there is a very high legal bar for them to do so, and this case is unlikely to reach that high bar.  

The Premier League initially claimed that Leicester City had recorded a loss of £129.4 million over the three seasons leading up to 2022/23, exceeding the £105 million limit set by PSR rules by £24.4 million. While there were reports indicating that Leicester had indeed breached the spending cap, a twist emerged when the Foxes argued that the Premier League lacked jurisdiction over them since they were relegated to the EFL before their accounting period ended on June 30, 2023. 

As a result, the appeal board ruled that because Leicester's accounting period concluded after their relegation, the Premier League could only assume, not confirm, a breach of PSR rules. In their written reasons, the appeal board noted, “It is possible that it (the club) could have sold players during the fortnight beginning on 14 June 2023... It (Leicester) could have some six weeks of trading to reduce its expected losses." Therefore, Leicester's relegation and their specific accounting period meant they couldn’t be penalized.  

However, Premier League argued that “common sense” made it obvious that the Foxes were in breach of the PSR rules. But the appeal board emphasized that their decision had to be based on the facts presented, not on common sense. Additionally, the panel criticized the PSR rules, describing them as "far from well drafted" and highlighting that the rules were “confusing.” 

While Leicester City and its fans have welcomed the panel’s decision, it has left several Premier League officials fuming. An official Premier League statement read, “The Premier League is surprised and disappointed by the independent Appeal Board's decision to uphold an appeal lodged by Leicester City FC regarding the League's jurisdiction over the club's alleged breach of its Profitability and Sustainability Rules (PSRs) when the club was a member of the Premier League... The Appeal Board's decision effectively means that, despite the club being a member of the League from Seasons 2019/20 to 2022/23, the League cannot take action against the club for exceeding the relevant PSR threshold in respect of the associated accounting periods." 

Following their failed attempt to punish Leicester City, fans can expect a significant shake up in the PSR rules. In an interview with Sky Sports, financial expert Kieran Maguire stated that Premier League’s PSR rules could be redrafted following this debacle. He said, “I think we will see a redrafting of the rules by the Premier League. They will claim that it wasn't the intention of the rules to allow this environment to take place. But Leicester's legal team clearly spotted that the rules had been poorly drafted. So, expect a redraft. The Premier League are in a very weak position if they do decide to go ahead with an appeal."  

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