The Premier League recently failed in an attempt to modify its financial regulations concerning the sale of fixed assets to entities linked to club ownership. A proposal aimed at excluding revenue from such transactions from Profitability and Sustainability Rules (PSR) calculations did not receive the necessary support from clubs to proceed to a vote at the league`s annual general meeting.
This specific rule drew attention after Chelsea utilized it to help meet financial fair play requirements. The club avoided a potential financial breach in 2023/2024 partly by selling two hotels and their women`s team to associated companies.
These sales were significant factors in Chelsea reporting a substantial net profit of £129.6 million for the financial year concluding on June 30, 2024, aiding their compliance with the league`s financial framework.
Current Premier League rules permit associated party transactions but mandate that they must be conducted at a fair market value. The league did review Chelsea`s hotel sales, subsequently reducing their recognized value slightly from £76.5m to £70.5m in the latest accounts. The valuation applied to the sale of the women`s team is reportedly still under assessment.
This is not the first instance this issue has been debated among top-flight clubs. Discussions around changing the rules on asset sales also occurred in 2021 and again last summer, but the existing framework remained in place, contrasting with the stricter rules implemented by the English Football League (EFL).
Notably, UEFA`s financial sustainability regulations differ, explicitly prohibiting the inclusion of revenue from the sale of fixed assets in financial fair play calculations. It is understood that Chelsea is currently in discussions with European football`s governing body regarding a potential financial settlement related to these rules.
