Premier League closes the "Chelsea Loophole," plus more fights about money

[The Gray Eagle]

In exciting off-field accounting news, the Premier League voted to change the amortization rules going forward. New contracts can only be amortized for 5 years:
https://theathletic.com/5131690/2023/12/13/premier-league-chelsea-loophole/

Sounds boring, but it's pretty important, especially for the big spending clubs.
No more of this type of deal:

In January, Chelsea spent at least £62million on Mykhailo Mudryk but will stretch that fee over the eight and a half years of his contract, the longest deal in Premier League history. A month later, they dropped £107m on Enzo Fernandez but that will only hit the books in £13m instalments over the length of his eight-and-a-half-year deal.
This season, they have already signed 11 players and given them contracts between six and eight years long. The total cost of these players was £419million but the annual amortisation charge is just under £60m. Clever, right? Hmmm, ask us again when some of these guys enter the final years of their contracts on loan in Turkey, with Chelsea paying half their wages.
Still, you cannot have a coherent cost-control policy, which is what FFP is meant to be, if one club is doing one thing and everybody else is doing something else.
So, this summer, UEFA, the people who brought us FFP, changed its rules to say clubs can only amortise transfer fees for a maximum of five years. They can still hand out eight-year contracts if they like; they just have to amortise the purchase price in five annual chunks.
And that is what the Premier League voted to do on Tuesday, too.

Things could have gone far worse for Chelsea:

In fact, this proposal only received 15 votes, with two clubs voting against it and three abstaining. You need 14 votes — a two-thirds majority — to change the league’s rulebook, so this got through with a bonus vote, but the result suggests five clubs wanted something else.
And that was to hammer Chelsea by backdating this rule change to the start of the season. If they had got their way, Chelsea’s amortisation charge for the 11 players signed this summer would have risen by £24million to almost £84million. That would have put them at risk of entering Everton territory in terms of the threshold for allowable losses, forcing the club to sell even more players in January than manager Mauricio Pochettino would like to see go.

Not unreasonably, Chelsea pointed out that this would be a bit unfair, as they complied with the rules as they were when they made those signings.
But some clubs think the Premier League’s leadership should have called Chelsea’s bluff and applied this amendment retroactively. They did not, however, have enough support to formally propose this at the meeting, so there was only the proposal to copy what UEFA has done on the table.
Their moods will not have been helped by the fact that Chelsea, having exploited this loophole, voted in favour of closing it. Now, that is quite clever.
To be fair to Boehly & Co, they have been planning to comply with the five-year limit ever since UEFA changed its rule. It might not look like it at the moment, but Chelsea want to compete in UEFA’s competitions again, so this loophole was effectively closed for them this summer.

They also discussed the new TV rights package, with many club owners unhappy that it only increased by 4%.

But the days when a Premier League chief executive could wheel out new deals worth 70 per cent more than the last one are long gone. Nowadays, standing still is a good result. And that is what the league’s sales team delivered: a four-year package worth £6.7billion, which is a British record for a sports media rights deal and four per cent up on the last time the league went to the market in 2018.
However, that four per cent has only been achieved by giving the broadcasters more inventory — 267 live games a season, up from 200 — and stretching the usual three-year term by another 12 months. It should also be remembered that the 2019-22 deal, which was negotiated in 2018, was a reduction of eight per cent on the 2016-19 deal.
But — and it is a big but — getting any kind of growth for the domestic rights is a huge win for the Premier League when you look at the difficulties the other major European football leagues and sports are having with their deals. It is tough out there and the Premier League’s relative position is only getting stronger. It also continues to deliver significant growth with its international deals.
Now, if the league was in a happier place, with no significant differences of opinion, the clubs would look at their glasses and realise they are half full. But the post-meeting grumbling suggests quite a few think half of their drink is missing.

Poor guys. Someone should start a GoFundMe for them so we can all donate to them.

There's also a long look at the controversy over the New Deal, where clubs will be sharing more of their wealth-- only die to government pressure of course. And so there is a lot of fighting over who will have to pay what:

The simplest way to explain this fiendishly complicated proposal is that it is the league’s response to a strong hint from the UK government that it must share more of its TV wealth — more than £3billion a year — with the rest of the game. The catalyst for this request was a combination of the specific financial crises at EFL clubs such as Bury and Bolton Wanderers in 2019, the more general panic caused by the pandemic and the anger caused by the Premier League’s six richest clubs trying to join a breakaway European competition in 2021.

But some around the shareholders’ meeting table still hate the idea, blame the Premier League’s leadership for letting it get this far and believe the regulator’s powers can still be diluted. For these clubs, the debate about the New Deal can wait. They want to see what teeth this regulator will have before they hand over any more money to potential rivals in the EFL.
And so we go around and around, proving for the 178th time that football cannot regulate itself because the clubs are blinded by their own narrow interests on any particular topic, and those interests can be very different depending on the time, place and circumstances.