The Premier League club’s strategy in the transfer market is unique in the world of football. It was demonstrated again this summer. Since Chelsea’s new owners took over the club in the summer of 2022, they have bought or loaned 41 players. The sum of this: NOK 15.8 billion, according to Transfermarkt. In comparison, Liverpool has spent NOK 4.2 billion in the same period, while Manchester City has bought players for NOK 5.1 billion in the last two years, also according to Transfermarkt. CHAIRMAN: Todd Boehly has become the face of the new owners. Photo: AP In addition, Chelsea has changed permanent manager four times in the same period. It’s not cheap either. According to several media, including The Athletic, Chelsea paid NOK 270 million at today’s rate to sign Graham Potter from Brighton. Then they fired him seven months later. – It is almost incomprehensible that they manage to make it happen. It is frightening financial management of an organization to operate in that way, says Tor Geir Kvinen, associate professor with a doctorate in experience economics, to news. The use of money has not produced particularly sporting results so far. 13th and 6th place in the Premier League is the result after two seasons with new owners. This season they play in the Serie A, where the income is nowhere near what they are in the Champions League. – It is critical. If Chelsea want to compete to win trophies they must enter the Champions League. Without the Champions League, you don’t have the resources to buy the players, says author and expert on football economics, Kieran Maguire. What had you spent 15.8 billion on? I had invested them I had bought a house, cottage, car and boat Bought Erling Braut Haaland and Kylian Mbappé for my favorite club I had shared with my family Show result Finding loopholes But how can Chelsea spend so much money without being punished for it? That is the question many football fans are now asking themselves. Both Uefa (the European Football Association) and the Premier League have different financial rules that the participating clubs must stay within. This is so that the richest clubs cannot buy trophies without any restrictions. Uefa and the Premier League’s financial rules Uefa: Uefa introduced financial fair play (FFP) rules in 2010. These were last changed in 2022. The clubs participating in European tournaments cannot spend more than 70 percent of their turnover on player and coach salaries, players – and coach purchases and agent fees. From the time the rule changes came in 2022, the clubs had three years to phase in. In 2023/24, the clubs were allowed to spend 90 percent of their income on the team, then 80 percent in 24/25, and then 70 percent from 25/26. In reality, clubs can exceed these regulations by a total of 60 million euros over three years. This can rise to 90 million euros for clubs that have a healthy economy and have not breached the regulations in the past. Premier League: The clubs must stay within the regulations for profit and sustainability (PSR). This means that the clubs cannot go more than £105 million in the red over a three-year accounting period. In reality, the clubs can only lose £15m in this period, but the PSR rules also allow a further annual loss of £30m over three years as long as the owners can show a concrete plan to cover the deficit. This amounts to £90 million. That’s a total of 105 million pounds (newly promoted teams have somewhat less wiggle room). For example: If a club has spent a lot of money in the 2022/23 and 23/24 seasons, they must ensure that they get enough income (e.g. from player sales) during the 24/25 season, so that they do not lose more than 105 million pounds in total. June 30 is the deadline each financial year. After this date, a new financial year starts. Some expenses go outside the PSR rules. This applies to infrastructure (e.g. car park), improvements to training facilities or the stadium, the operation of the academy and the women’s team. This means that the regulations only apply to the first team, and mainly player purchases and salaries. Due to breaches of this regulation, both Everton and Nottingham Forest received points penalties in the 2023/24 season. Changes to these regulations are expected during the next few seasons. Then it will be similar to what Uefa now uses. The London club has been good at finding loopholes in the current regulations. There are four measures in particular that the experts believe Chelsea have taken in order to be able to spend so much money, but at the same time have a goal of coming within the financial rules: Buy now – pay later – They have signed players on very long contracts, so that they can distribute the sums beyond the contract period. If they pay 500 million for a player and give him a five-year contract, the transfer will cost them 100 million per year, says expert on sports economics, Harry Arne Solberg. An example of this is the Argentine midfielder Enzo Fernández. He was bought for close to NOK 1.4 billion and signed a contract of eight and a half years. Usually a contract in the world of football is 4-5 years for players under 30 years of age. Maguire assumes that the club owes at least 8.3 billion to other clubs for previous transfers. EXPENSIVE BUY: Argentine Enzo Fernández was brought in from Benfica in January 2023. Photo: Reuters Chelsea’s long contracts also reduce the danger of losing the player for free when the deal expires. – In December 2023, the Premier League clubs agreed on measures to prevent this very thing. Now you can only distribute the transfer fee for a player over five years, regardless of whether the player signs a contract that extends longer than this, says Solberg. However, this does not apply to contracts that had already been signed. Since the new owners came in, Chelsea have also changed the wage structure. New players receive a lower basic salary than Chelsea has given players in the past. At the same time, the salary is to a greater extent bonus-based, depending on sporting success. news has not succeeded in getting a comment from Chelsea. Buying young The 41 purchases for Chelsea’s new owners have an average age of just under 22 years. In 2023/24 they had by far the lowest average age in the Premier League. They focus on bringing in young players. And preferably many in each position, which is shown, among other things, in the goalkeeper position, where they have eight first-team players under contract. Many players are loaned out, in the hope that they will return to Chelsea and be good enough to strengthen the team. If they are not good enough, they must be sold, preferably for more money than they were bought for. – No other team in Europe does the same as Chelsea. They are trying to break with the model, says Maguire. The strategy can give Chelsea a team with all the best talent in the world, but it can also present challenges: – The players who are not good enough will be a problem if no club will pay the high transfer fee, and meet the wages, says Maguire and continues: – If they do not manage to sell the unwanted players, they have to pay the salary of someone who does not train with the first team. So it’s very high risk. The statements of manager Enzo Maresca at a press conference earlier this season gave a picture of the situation at the club. – I don’t work with 42 players. I work with 21 players. The other 15 to 20 players train alone. I don’t see them. It’s not chaos, although it might look that way from the outside…Absolutely not, he said. – You should not get into situations where players are frozen out or have to leave the club because they have brought in three-four-five-six others in his position and broken promises. Only that is a sign of illness in itself, says Viaplay’s football expert Petter Veland. Maguire thinks nothing of this way of running a club: – It makes the players feel worthless. It’s a terrible way to treat people. Raheem Sterling signed for Chelsea in good faith. After two years, he is treated like a child’s toy a few days after Christmas Eve. Sterling was told by Maresca that he was no longer part of the club’s plans. He recently went on loan to Arsenal, while Chelsea, according to reports, pay part of his salary of close to four million kroner a week. MANAGER: 44-year-old Enzo Maresca. Photo: Reuters Selling their own – Chelsea have not only been good at spending money, they have also been good at selling players, says Maguire. In the last two years, they have sold players for NOK 728.9 million. This, along with commercial deals, TV deals and ticket revenue, is the club’s main source of income. In particular, many self-produced players have left the club for large sums in recent years. The PSR rules encourage the sale of self-produced players. This is because these earnings must not be shared with other clubs, as the player has only played permanently at the selling club. So when Chelsea sold Conor Gallagher to Atlético Madrid for nearly NOK 500 million this summer, all of this money went straight into Chelsea’s annual accounts. – They have sold academy products to invest in new players. Everyone says it is very strange, and it is very strange, but they are convinced that they know more about football than the rest of the football world does, says Maguire. SOLD: Englishman Conor Gallagher was sold from Chelsea this summer after many years in the club’s academy. Photo: Reuters Selling to themselves But it is not just players they have sold. – They have also sold assets that are not football-related, such as car parks, hotels and the club’s women’s team, all of which have been owned by the club, says Maguire. The price for the two hotels should have been in excess of one billion Norwegian kroner, according to ESPN. The buyer of these assets is BlueCo 22 Properties Ltd. A company, which, like Chelsea, is owned by the BlueCo 22 consortium that bought the club in 2022. Like self-produced players, this is also accounted for as pure profit, which in turn is spent on new players. – They can only do it once with each asset. So that gets them out of a problem for a couple of years. But in the end they run out of assets they can sell themselves, says Maguire about the unique strategy to get within the financial rules of the Premier League. Boehly and BlueCo also own French Ligue 1 club Strasbourg. This year they have loaned three players and bought winger Diego Moreira from Chelsea. In Strasbourg, Chelsea hope to give the young talents playing time and experience from one of Europe’s best leagues. More than 300 teams have owners with shares in two or more clubs, Uefa reported in February. And it is becoming more common for such transfers to take place across clubs with the same owner, which Manchester City also did this summer. This is something Uefa will now address and try to stop, according to The Times. According to media reports, Chelsea’s Deivid Washington was very close to a move to Strasbourg on Deadline Day. Washington was bought for NOK 188 million last summer and has only played three times for Chelsea. Strasbourg is said to have agreed with Chelsea on a transfer for NOK 250 million + possible bonuses of NOK 35 million. The transfer is said to have collapsed because Chelsea feared the investigation afterwards, according to several media outlets, including ESPN. BRAZILIAN DUO: Deivid Washington hangs around former teammate Thiago Silva. The latter left the club for free this summer, when his contract expired. Photo: Reuters The risk and consequences No one knows yet whether this new strategy will be a success. Chelsea are, along with 19 other clubs, on Uefa’s list of teams they are particularly monitoring for financial reasons. – I understand that there are many critical voices against the club’s operation. There are a lot of people who are going to say “what did we say?” if they are punished, says Veland and continues: – The only way Chelsea can get out of this, both in terms of reputation and financially, is to win, win, win, get to the Champions League and get income that way. If not, I don’t understand how they will be able to calculate this over time. Everton and Nottingham Forest received eight and four penalty points respectively for breaching the PSR rules in the 2023/24 season. Uefa has previously punished clubs that have exceeded the financial limits by refusing them to play in European tournaments. Fifa has punished the same by refusing teams to buy players, which Chelsea experienced at the latest in 2019. In 2023, Manchester City was accused by the Premier League of 115 breaches of the rules. “Everyone” is anxiously waiting for when the verdict will come and what it will be. – I don’t think there will be as big a punishment or indictment for Chelsea, as with Manchester City, if this strategy doesn’t work. The City case covers a period of around ten years, for Chelsea it is a period of one or two years, says Maguire. Published 28.09.2024, at 12.10
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