15-04-2025
Premier League amends PSR rules amid Leicester City dispute
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 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.
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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.
A statement from the Premier League in January read: 'Issues as to the jurisdiction of the Premier League over Leicester City Football Club in relation to PSR compliance are currently the subject of confidential arbitration proceedings.
'Accordingly, neither the league nor the club will make any further comment at this stage about any aspect of the club's compliance or otherwise with any of the PSR or related rules, save to say that no complaint has been brought against Leicester by the league for any breach of the PSRs for the period ending season 2023-24.'
Additional reporting: Dan Sheldon
Analysis by Chris Weatherspoon
Were it not for events of last year, this new wording could easily have passed by without fanfare. In confirming clubs are required to comply with Premier League rules even in seasons they are relegated, and clarifying a club's PSR loss limit in all EFL seasons within a given PSR cycle is £13m rather than the Premier League's £35m, the changes merely codify what many already assumed to be true.
That was until Leicester's successful appeal last September, which found the Premier League had no jurisdiction to punish Leicester because they had been relegated by the time their 2022-23 accounting year finished.
Leicester argued they had 'sought to ensure that the rules are applied based on how they are actually written'. This is the Premier League tightening the language of those rules, and it comes at a time when multiple recent stories have raised questions around the strength of the league's existing financial regulations.
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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.
