The Premier League accused the already relegated Leicester City of violating the Profit and Sustainability Rules (PSR), and the Foxes may face a large penalty of deductions or even a transfer ban.

The Premier League has now referred the Leicester City case to an independent committee, accusing it of violating the PSR rules in 2023-24. During the three-year accounting period ending in 2023-24, Leicester City experienced promotion to the Premier League and then relegation. Since the Premier League and the Championship belong to different competent authorities, the arbitration tribunal investigated the jurisdiction issue and determined that the Premier League could investigate Leicester City's alleged violations.

Leicester City was relegated from the Premier League in the 22-23 season, and they have been trying to avoid PSR sanctions since then. Because Leicester City has made the top eight of the Premier League in the previous three seasons, they hope that the Premier League will relax some of the rules because if they want to compete with the stronger (and richer) teams in the previous few, the cost of expenditure must be increased.

In the three-year cycle ending in 2023, the Foxes lost £215.2 million. In March of the following year, the Premier League referred the situation to the committee, accusing the Foxes of violating the PSR limit of £19.5 million. But the club won the appeal, arguing that they were not a top club at the time of the violation because they had been relegated.

But in the 2023-24 season, Leicester City lost another £19.4 million, bringing the total loss in the new three-year cycle to £201.6 million. Since they only played one season in the Championship, they were only allowed to lose £83 million.

Now, the court will rule on the relevant disputes. First, the appeal committee ruled that the Premier League had no right to accuse Leicester of violations in the 22-23 season. Did the Premier League violate the law by doing so? Second, did the Premier League have jurisdiction to investigate the club's alleged violations in the 23-24 season because they were participating in the Championship at the time?

The court ruled on the two disputes: first, the Premier League has the right to accuse and prosecute the club; second, as long as the EFL (the governing body of the English Championship) begins to investigate the club, the Premier League has the right to conduct a PSR investigation on the promoted club.

So will Leicester City's Premier League points this season or the English Championship points next season be deducted?

Since the club refused to submit its accounts for the 2023-24 season to the Premier League before December 31 last year, the Premier League cannot sue the club this season. Therefore, if Leicester City is deducted points, it will be in the English Championship next season. At that time, the Premier League, at the "instigation" of the EFL, will likely make a request to a new tribunal to apply for a deduction measure that can be applied in the English Championship.

Given Leicester City's long struggle to avoid sanctions from any party and their recent failure to submit accounts to the Premier League, they will almost certainly be accused of serious violations. This means that from the start of the English Championship next season, the club will be deducted 12 points, and the Premier League will even ask for more.

Ironically, if Leicester City had accepted their fate for the 2023-24 season earlier and accepted the punishment the Premier League deemed appropriate, then by now the points deduction penalty in the Premier League would have passed and would not "affect" their relegation or the club's ability to start the next season in the Championship with a non-negative score.

Since the EFL has not completely given up on the idea of ​​accepting the PSR investigation for the 2022-23 season, the EFL will be able to take over all of Leicester City's accounts for next season, so it is possible that the club will face a transfer and budget ban or restrictions.