opinion
transfer excess
Chelsea are throwing money around for shamelessly exploiting a rule loophole
Argentina’s Enzo Fernández has been named the World Cup’s best young player and has now joined Chelsea for the insane €121m
© Tom Weller / DPA
Chelsea FC spent an incredible 300 million euros on new players in the winter transfer window. This is possible because the London club shamelessly exploited a loophole in Uefa’s financial rules. He’s taking a big risk for that.
Enzo Fernández was named the tournament’s best young player at the 2022 World Cup in Qatar. The 22-year-old Argentinian can therefore be considered a promising talent. Signing him is a sensible investment in the future. Chelsea thought so too and took the midfielder from Benfica in the winter transfer period for 121 million euros. That’s a new record in the Premier League. So far, Manchester City had held for Jack Grealish with 118 million euros.
Fernández is not the only supposed super talent that the London club committed with the almost inexhaustible financial strength. Club owner Todd Boehly and his investor group Clearlake Capital just donated 100 million euros for the Ukrainian Mychajlo Mudryk. In total, the Premier League club spent over 300 million euros in winter alone. Including the summer, Chelsea invested around 600 million euros. That’s more money than the entire Bundesliga spent this season combined.
Chelsea use loophole to excess
But how are such sums possible in view of the alleged financial fair play? New rules from the European football association Uefa have been in effect since April 2022. They are now called Financial Sustainability and are supposed to be stricter. (Previously, the rule of thumb was that a club may not spend more than it earns).
The two most important rules are: From 2025, clubs may invest a maximum of 70 percent of their income in player salaries, consultant fees and transfers. Until then, it will be staggered, in 2023 it will be 90 percent, in 2024 80 percent. And an external investor can compensate for a deficit of 20 million euros between income and expenditure per year.
But financial sustainability offers a loophole that Chelsea is exploiting to excess. Clubs are still allowed to stretch the transfer fee over the term of the contract. That means: If a player costs 50 million euros and receives a contract for five years, ten million euros are offset in the annual balance sheet for the transfer fee.
Extremely high risk
That’s why Fernández and Mudryk were each given eight-and-a-half-year contracts. The transfer fee of 121 million euros for Fernández, offset over eight and a half years, only accounts for 14.2 million euros in the annual balance sheet. Chelsea officially comply with Uefa’s Financial Sustainability Rules. Other players also received correspondingly long contracts. In the summer, Uefa wants to modify the regulation, from then on it can be extended to a maximum of five years.
It’s very risky for Chelsea. More than ever, the club is dependent on qualifying for the Champions League in order to at least partially refinance the investments. In view of the 10th place in the table, ten points behind a Champions League place and the sometimes weak performances this season, it is not an easy task. The pressure on Graham Potter’s team has increased. In addition, the club depends on the players being worth a lot and the investment paying off. If not, the club and the investor have burned a lot of money. What happens when the consortium around Boehly loses interest in the blues? Then Chelsea would be left pretty bare.