Leicester City have been handed a six-point deduction for breaching EFL rules and have dropped down to 20th place in the Championship table as a result.
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| Leicester City have been handed a six-point deduction (Image: Getty) |
Leicester City have been handed a six-point deduction for the current Championship season, which drops them near the relegation zone, and the Premier League have released a 100-page commission report which details the complex legal battle between the Premier League (PL) and Leicester City FC (LCFC). The Foxes were found to have breached the EFL's profit and sustainability rules for the 2023/24 season and an independent commission recommended the six-point sanction, which was implemented by the EFL board today. Express Sport looks at seven takeaways from the Premier League's report...
1. £9.6million substitute
The report stated that if the EFL was "unwilling or unable" to enforce the recommended six-point deduction, the Commission would impose a £9.6million financial penalty as a substitute sanction. This figure was calculated to serve as a punishment and to vindicate other clubs that complied with the rules.
But the financial aspects discussed in the report are tied to the Rules B.18 and W.1 breaches (disclosure) rather than being a direct "buy-out" for the points deduction, which the EFL has now ratified and applied immediately. So Leicester do not need to pay the fine as a result.
2. Breaches of disclosure obligations
Beyond the financial overspend, the Commission found LCFC in breach of disclosure rules (Rules B.18, W.1, and W.16).
Refusal to provide accounts: The club refused to provide its FY24 Annual Accounts when requested by the PL.
Jurisdictional defence: LCFC argued the PL had no power to request these accounts, but the Commission rejected this, noting that clubs remain bound by rules during investigations even after changing leagues.
3. The "37-month" dispute
A major technical argument centred on whether LCFC’s losses should be assessed over 36 or 37 months.
Accounting extension: Because LCFC changed its financial year-end in 2023, its audited accounts for the three-year period actually covered 37 months.
The difference: The PL alleged the overspend was £42.1 million over 37 months, compared to £23.6 million if only 36 months were counted.
Decision: The Commission ruled that the rules require assessment based on the actual "Annual Accounts," meaning the 37-month period stood.
4. Leicester’s competition law challenge
LCFC attempted to have the case thrown out by arguing the PL’s rules breached the Competition Act 1998.
Ground 1: They argued that applying EFL sanctioning guidelines to a club now in the PL was "unfair and disproportionate".
Ground 2: They challenged the "Variable Upper Loss Threshold," which sets different loss limits (£83m vs £105m) based on time spent in the Championship.
Outcome: The Commission rejected both grounds, ruling the measures were necessary to prevent clubs from "gambling" on promotion through overspending.
5. Mitigating and aggravating factors
The final six-point sanction was reached after weighing several factors:
Positive trend (Mitigation): LCFC received a one-point reduction because their losses were trending downwards, showing an intent to eventually comply.
Lack of "exceptional co-operation": The Commission denied further mitigation, noting that LCFC's legal tactics had "disrupted and delayed" the investigation.
Sporting Advantage: The PL argued that by overspending, LCFC avoided having to sell star players at "undervalues," which helped them stay competitive in the Championship.
6. Legal "U-turns"
The report highlights that LCFC’s legal position shifted significantly during the hearing. Initially, the club argued for a delayed points deduction (to be served only if they returned to the PL), but by the end of the trial, they argued the Commission had no power to impose any sporting sanction at all, pushing for a fine instead.
7. The "unprecedented" sanction
Leicester City expressed "profound disappointment" in their official statement, specifically calling out the Premier League for seeking what the club described as an "unprecedented" and "disproportionate" sanction.
The club argued that the league’s pursuit of a six-point deduction (on top of the threat of a massive fine) ignored the unique circumstances of their transition between divisions and represented an attempt by the Premier League to exert "overreaching authority" beyond its jurisdiction.
8. The "double jeopardy" argument
Leicester’s legal team argued that they were being punished twice for the same financial period—once by the EFL (who previously placed them under a registration embargo) and now by the Premier League. The Commission rejected this, ruling that an EFL embargo is a "compliance tool" while a points deduction is a "punishment," meaning they are legally distinct.
9. The "fair play" definition
A significant portion of the 100 pages is dedicated to defining what "fair play" actually means in a financial context. The Premier League argued that Leicester’s overspend wasn't just a numbers error, but a "deliberate choice" to maintain a squad they could not afford, thereby gaining a sporting advantage over clubs that stayed within their means.
The 100-page report also goes into exhaustive detail about the "March 2025 Arbitration Tribunal," which was the turning point that allowed the Premier League to investigate a club that was technically in the Championship at the time of the breach.
10. Implications for future cases
The report sets a legal precedent for "relegated/promoted" clubs. It confirms that the Premier League retains the power to punish a club for a breach that occurred while they were a member, even if that club is now in a different league (the EFL) by the time the verdict is reached.
11. Executive testimony
The report references testimony from Leicester’s senior leadership. It highlights that the club felt "trapped" by high player wages and long-term contracts signed during their years of success (including their European campaigns), arguing that the "cliff-edge" of relegation made it impossible to balance the books quickly enough to meet the 37-month deadline.
- Charlie Malam
