Chelsea's task of complying with UEFA's financial rules has been made significantly harder after the European football governing body confirmed that it will not allow clubs to declare income from selling assets to sister companies.
Blues co-owner Todd Boehly has offset some of the club's losses by selling two of Chelsea's hotels to a sister company for £76.5million. The women's team, meanwhile, was sold to the club's parent company two days before the end of the financial year in June.
Those financial manoeuvres were permitted by the Premier League due to a loophole which has not yet been closed. According to The Times, UEFA will not allow clubs to register income through selling assets in that way.
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UEFA's financial regulations are already more difficult to comply with than the Premier League's. Profit and Sustainability Rules, used by the Premier League, permit clubs to lose a maximum of £105m over a rolling three-year period. UEFA's 'football earnings' rule permits club to lose only £34.5m over two seasons.
If Chelsea fail to comply, they could be met with a range of punishments, including exclusion from European competition. Though it is said that any penalty would not affect their participation in this season's Europa Conference League, and would instead be applied next campaign.
Back in 2019, AC Milan reached a settlement with UEFA to serve a one-year ban from European competition due to multiple financial breaches.
Chelsea's most recent accounts were published in April, and in them Boehly reaffirmed that the club are in line to comply with UEFA rules.
"The club continues to balance success on the field together with the financial imperatives of complying with UEFA and Premier League financial regulations," he said. "The club has complied with these since their inception in 2012 and expects to do so in the foreseeable future."
Boehly and Clearlake had spent over £1billion on transfer fees even before this summer transfer window swung open. The Londoners have raised cash through selling the likes of Conor Gallagher and Ian Maatsen, though they have once again spent significantly more than they have earned, with Pedro Neto and Joao Felix among their raft of new signings.
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The Blues lost £89.8m in 2022/23, putting them miles over UEFA's threshold unless they made a significant chunk back in 2023/24, when they didn't have European football to boost their earnings.
Football finance expert Kieran Maguire believes it could be 'more than challenging' for Chelsea to comply with UEFA's financial rules this time around.
