Leicester City are anxiously awaiting confirmation on whether they will face charges from the Premier League for breaching profitability and sustainability regulations (PSR) for a second consecutive season.
The club is among several in the Premier League required to submit financial accounts for the 2023-24 season by the New Year’s Eve deadline due to recorded losses over the last two years. A decision on whether they have breached PSR rules is expected by January 13.
Earlier this season, Leicester avoided a points deduction after being charged with a £24.4 million breach for the 2022-23 season.
The club’s legal team successfully argued before an independent commission that Leicester were no longer in the Premier League when their accounts were submitted on June 30, 2023, as they had been relegated at the end of that season.
Despite their defense, Leicester’s financial woes remain significant. They reported pre-tax losses of £92.5 million and £90 million for the 2022 and 2023 financial years, leaving them vulnerable to another PSR charge.
Any penalty could prove disastrous for Leicester’s survival prospects. Currently second from bottom under Ruud van Nistelrooy’s management, the team would face a daunting task to stay in the Premier League should they incur a points deduction similar to the ones Everton and Nottingham Forest received last season.
Premier League regulations cap club losses at £105 million over a three-year period for teams continuously in the top flight.
However, Leicester’s relegation to the Championship last season reduced their permitted losses for the current cycle by £22 million due to stricter English Football League (EFL) spending rules.
Player sales have helped offset some of Leicester’s losses. The £38 million transfer of Harvey Barnes to Newcastle, Timothy Castagne’s £15 million move to Fulham, and £10 million in compensation from Enzo Maresca’s departure to Chelsea are all included in their latest accounts.
However, the £30 million sale of Kiernan Dewsbury-Hall to Chelsea falls outside the reporting period, as it occurred in July 2024.
Leicester have expressed optimism about avoiding further charges, but Premier League insiders believe the club may still have a case to answer.
The Guardian previously reported that Leicester could also face EFL charges for overspending during the 2020-23 period if they are relegated again at the end of the current season.
Under new regulations introduced 18 months ago to expedite PSR investigations, all Premier League clubs with aggregate losses over the past two accounting periods must submit their most recent accounts by December 31.
Premier League lawyers and accountants will review these submissions over the next two weeks, with decisions on potential charges to be announced by January 13.
Leicester, already identified as being £24.4 million over the limit for the 2022-23 season, remain the most at risk.
Meanwhile, clubs like Chelsea, Everton, and Forest, who bolstered their compliance with substantial player sales last summer, are reportedly confident in their adherence to PSR rules.
