Wednesday , May 29 2024

EFL cannot punish Leicester City’s PSR violations while in Premier League!

On March 22, 2024 Leicester City Football Club announced they had commenced urgent legal proceedings against the EFL and the Premier League.

This followed the Club’s referral to an independent Premier League Disciplinary Commission for an alleged breach of the Profitability and Sustainability Rules (P&S), ending in financial year 2022/23. The Club had also been placed under an EFL registration embargo, in accordance with Profitability & Sustainability Rule 2.10.1, after filing its 2023/24 P&S calculation.

One element of the Club’s legal proceedings involved an application to a League arbitration panel under the EFL Regulations in which it accused the EFL, amongst other things, of acting ‘unlawfully by conspiring with the Premier League to use unlawful means and to procure or induce a breach of contract by the Premier League’ in relation to its proceedings against the Club.

The Club made an application for an interim injunction to prevent the EFL from imposing a sporting sanction in the current 2023/24 season.

Leicester City sent no letter before action and issued the proceedings without notice.

The core issue in question was whether the EFL has the ability under its Regulations to apply a points deduction in its competition if ordered by a Premier League Disciplinary Commission.

Having taken legal advice, the EFL has confirmed to all parties that whilst it would want to respect any decision of a Premier League Disciplinary commission (and vice versa) to deduct points in the EFL, it does not have the power under the Regulations as currently drafted.

On the basis of that confirmation, the League Arbitration Panel held that the Club’s application for an interim injunction was neither necessary nor appropriate. The League Arbitration Panel dismissed the Club’s application accordingly.

It remains a matter for Leicester City to comply with the P&S rules in all circumstances. In accordance with the League’s established processes, the EFL will continue to apply the P&S rules to ensure all Clubs meet their financial obligations so the competition can continue to operate in a fair and consistent manner.

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