Why Man Utd glory puts Todd Boehly and Chelsea in the FFP mire amid European ban claim

Will Ford
Boehly Fernandes Chelsea Man Utd
Manchester United's FA Cup win has caused Todd Boehly and Chelsea a big problem.

Todd Boehly and his Clearlake buddies won’t have enjoyed Manchester United’s 2-1 win over Manchester City in the FA Cup final on Saturday, as victory for Erik ten Hag’s side had the knock-on effect of demoting Chelsea to the Europa Conference League next season, or rather the play-offs of the Europa Conference League.

A club statement after the final whistle as Wembley read: ‘Chelsea will play in the 2024/25 UEFA Conference League after England’s European qualification spots were finalised following Saturday’s Emirates FA Cup final.’

But there was speculation in February ahead of the Carabao Cup final, as victory over Liverpool would also have granted Chelsea entry into the Conference Lague, that it may be in the club’s interest to be banned from all European competition rather than compete in its third tier.

UEFA’s financial sustainability regulations are considerably more restrictive than the Premier League equivalent, with £68.5m over the previous two years the key loss threshold for Chelsea should they compete in Europe, rather than £105m over the previous three, as is the case domestically.

Player bonuses for qualifying for European competition will likely be offset by commercial incentives from club sponsors, but the effect on the amortised cost of Chelsea’s £400m in player signings in the summer of 2023 will be another significant barrier to their participation.

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That was the first transfer window following UEFA’s decision to cap player amortisation at a maximum of five years, a rule that only came into effect in the Premier League in the most recent January window.

It essentially means that Chelsea’s spending in the summer of 2023 is more expensive if they compete in Europe.

Football finance expert Kieran Maguire provided an example in The Athletic: “In the case of Moises Caicedo (who signed an eight-year contract with Chelsea after joining from Brighton & Hove Albion), his £100m transfer fee counts as £12.5m annually for PSR but, in UEFA’s calculations, it will need to be £100m divided by five (years). So it will count as £20m per year.”

Ten of the 11 players Chelsea bought in the summer of 2023 signed contracts longer than five years, and the amortised cost jumps from £59.4m domestically to £80.9m in Europe.

All of this means that qualifying for the Europa Conference would lower the maximum amount Chelsea are allowed to lose by £36.5m, while increasing the amortised cost of their transfer spending in the summer of 2023 by £21.5m.

That’s a significant added financial burden, and given West Ham earned just £16m for winning the Europa Conference League last season, it doesn’t make fiscal sense for Chelsea to enter the competition.

We would be remiss at this point not to question how Todd Boehly and the raft of more qualified people he’s hired since taking over the club didn’t foresee this problem.

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Given they (presumably) knew about UEFA’s amortisation rule change, why did they continue to spend so heavily in the summer of 2023? Were they so convinced they would qualify for the Champions League this season that it wouldn’t matter? Did they even know that they had to qualify for the Champions League this season?

It’s baffling, as it’s all been since they took over the club.

As Maguire says, they could follow in the footsteps of AC Milan, who struck a deal with UEFA to serve a one-year ban from European competition, rather than the standard two-year exclusion. Every cloud, eh lads?

“It could be in Chelsea’s interests to do the same as Milan,” Maguire said. “We’re moving into the realms of three-dimensional chess here, which some clubs are capable of playing.

“By the time you pay the players’ bonuses for qualifying for the competition, transport, accommodation and other costs, you’re only making a small amount of money from the Conference League. You’ll struggle to get a decent number of fans to attend Stamford Bridge if the opposition is modest. That isn’t a criticism of them. It’s modern-day economics.

“If they are exceeding the UEFA limits, the question becomes: ‘Do we want to go and play in the Conference League next season?’. Because they won’t make any money from it.”

Everyone seems to be agreed that Chelsea will have to make significant player sales whether they decide to play in the Europa Conference League or not, with academy graduates on the chopping block given they represent ‘pure profit’ on the books.

“Could they increase their commercial income? Yes, but the main deals can’t be improved upon,” Maguire added. “There’s relatively little wiggle room on the commercial side, so you have to look at (player) asset trading before June 30.”

What Manchester United have effectively done by winning the FA Cup is ensure that Chelsea have to sell the majority of their remaining first team academy products – Conor Gallagher, Trevoh Chalobah, Armando Broja and Ian Maatsen – so that they can play in the Europa Conference League next season. That’s quite the repercussion.