Chelsea look set to avoid breaching the top-flight’s financial rules after the Premier League were reportedly unsuccessful in their attempts to close a loophole in their profit and sustainability rules.
Clubs are currently able to include the profits from the sale of training grounds, stadiums and other tangible assets as part of their profit and sustainability calculations but the league had sought to change that at Thursday’s Annual General Meeting.
It came after Chelsea had sparked outrage in April after the west London club sold a hotel on their Stamford Bridge site to one of their sister companies – in a bid to avoid breaching the Premier League’s profit and sustainability rules (PSR).
The consortium, led by Todd Boehly and Clearlake Capital, offloaded two hotels situated next to the ground generating around £75.6million – with the sale reducing the club’s losses from £248.5m to £90.1m after tax, the club had said.
According to The Athletic the Premier League proposed a ban on clubs from performing such actions at its Annual General Meeting at the Rudding Park Hotel in Harrogate on Thursday. It appears only 11 of the 20 clubs backed their movement – short of the two-thirds majority needed to ratify an amendment to the rules.
The Millennium and Copthorne hotels were sold off to another company held by the owners
Chelsea sold hotels on their Stamford Bridge site to avoid breaching Premier League rules
The hotels were sold to one of the football club’s sister companies, generating £75.6million
The outlet claims that the Premier League had looked to emulate the EFL’s ban on using the sale of tangible assets in a club’s spending calculations. That ban was made in 2021 after multiple clubs had sold stadiums and training grounds to themselves in a bid to avoid PSR breaches.
Manchester City’s former financial advisor, Stefan Borson, had also claimed that Chelsea had attempted to use the loophole again in May by allegedly trying to sell their Cobham training ground to themselves.
While there was much outrage towards Chelsea’s previous hotel sales – with insiders at the club claiming they had ran the deal past the top-flight – the Premier League’s action to prohibit teams from capitalising from the loophole had failed – with clubs voting against the proposed rule change.
Doubts were raised over whether the west London side would be able to comply with the profit and sustainability rules, after posting losses of £90.1m before tax for the 12-month accounting period ending on June 30, 2023.
It was also revealed in April that the club had posted the most severe operating loss of any team in the history of the Premier league. The Blues were found to have incurred a staggering £249m loss, which was nearly £100m more than their nearest rivals Leicester.
The club have also spent a staggering £1billion since Boehly and Clearlake capital took charge back in 2022.
There were concerns that Chelsea would have to sell some of their top stars, including Conor Gallagher (pictured) to help alleviate their PSR constraints
The Blues could still look to sell several stars before their June 30th deadline, including Borussia Dortmund loan player Ian Maatsen (centre)
Their financial woes had raised fears that the Blues may have to sell some top stars this summer in order to balance their books before their June 30th accounting deadline.
Conor Gallagher was one player who has heavily been linked with a move away from the club, but thanks to their hotel sales, it seems as though Chelsea will narrowly squeeze under the £105m allowable PSR loss for the 2022-23 season.
But Chelsea could look to offload the likes of Ian Maatsen, Armando Broja and Trevoh Chalobah could raise nearly £80m for the club.
That means, incoming boss Enzo Maresca could have more resources to stamp his brand on Chelsea this summer.
The Athletic adds that member clubs believed the ‘wording on the ban was too wide’ prompting Premier League clubs to vote against the change. The report adds that the language used did not make clear the type of non-football revenue streams that could be used in a club’s profit and sustainability calculations and those that should be avoided. It is thought that the proposals will be reworked before being put before clubs again.
During the meeting, Premier League sides also dissented against Wolves’ proposals to abolish VAR, while clubs are also set to trial two forms of salary cap next season, with executives agreeing to use UEFA’s Squad Cost Rules and the ‘anchoring’ system on a ‘shadow basis’.
According to the BBC, the Premier League released a briefing document to all 20 clubs before Thursday’s AGM, explaining the reasons why it believes VAR should remain.
Should they sell several players before the June 30th deadline, incoming boss Enzo Maresca (centre) will have a little more wiggle room in the transfer martket
Insiders at the club state that the Blues’ owners had ran their plans to sell their hotels past the Premier League before the sale was made
They allegedly claimed that there would be 100 more incorrect refereeing decisions made per season if clubs voted to scrap the technology – adding several other reasons as to why the league feels VAR should stay.
Gary O’Neil’s side have not been the only team to be aggrieved by the controversial system this season, which was first used in the top-flight in 2019. Arsenal manager Mikel Arteta was fined for blasting the system following a controversial incident away to Newcastle, while Jurgen Klopp said in May that he would vote to scrap VAR as ‘referees cannot use it properly’.
Wolves formally submitted a resolution to the Premier League in May which triggered the vote on whether VAR should remain in place for the 2024-25 season after having been on the wrong end of several contentious decisions this season.
But it was expected that Wolves’ proposals would fall flat with other clubs in the league voting against the motion and were of the view that they simply want the system to be tweaked.
One senior source at a rival club told Mail Sport that they were in favour of video-assisted refereeing technology but would like assurances over quicker decisions from the PGMOL.
Despite that, Premier League clubs did agree to a new salary cap trial which would begin at the start of the 2024-25 season. The new cap will form part of several new regulations that will replace the much-criticised PSR rules.
Clubs agreed to implement UEFA’s Squad Cost Rules (SCR) and the controversial ‘anchoring’ system on a ‘shadow basis’.
Reports also claim Chelsea tried selling their own Cobham training ground to themselves
Former football finance advisor Stefan Borson made the claims on social media on Sunday
The league’s Annual General Meeting took place at the luxury Rudding Hotel in Harrogate
The meeting also came just two days after Manchester City issued that they would be taking legal action against the Premier League over their concerns over the league’s rules on Associated Party Transactions (APT) – but there was no discussion on the legal battle.
Elsewhere on the agenda, Premier League newcomers Southampton, Leicester and Ipswich were also set to be confirmed as top-flight clubs during the AGM.
