According to a former financial advisor to the champions, Manchester City and Chelsea are in danger of being demoted from the Premier League after Everton’s 10-point punishment created a powerful precedent.
Everton were docked ten points for violating Premier League profit and sustainability criteria, dropping the Toffees to 19th in the table, but the club intends to appeal.
Manchester City is being investigated for 115 potential breaches of Premier League financial rules, while Chelsea may be investigated for alleged payments related to previous owner Roman Abramovich.
Stefan Borson, a lawyer who has advised City, tweeted after Everton’s news broke on Friday: “Without seeing the judgement/award -10 points for Everton feels harsh for a straightforward FFP [Financial Fair Play] breach to me.
“But reinforces that sanctions against City [if proven] and now Chelsea [if charged and admitted on the off-books payments] will be potentially relegation inducing.”
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Borson added: “One thing is for sure, given the scale of this sporting sanction, Chelsea’s calculus [in my opinion] that they could breach PL P&S [Profit and Sustainability] and just take a fine as a cost of doing business, must be in urgent and immediate reconsideration.
“The January window may be interesting. Even in the best case, they can no longer rely on being able to convince an Independent Commission to accept their Covid and Sanctions allowances as exceptional adjustments [to the extent that was the plan].”
Borson mentioned relegation as a possible consequence in February when City was charged with 115 breaches of the Premier League’s financial rules regarding sponsors and contracts during a nine-year period.
He tweeted then: “Alarmist or not, the sheer extent of the PL charges are at a level that IF found proven, must lead to relegation.”
According to reports earlier this week, Chelsea will face a Premier League inquiry over a series of payments related to former owner Abramovich.
According to the Guardian, Abramovich, the Russian oligarch who controlled the club for 19 years before being sanctioned by the British government last year, utilised offshore entities to make payments to the club.
The Premier League is already looking into the Blues after their new owners discovered ‘possibly inadequate financial documentation’ associated with Abramovich’s era while doing due diligence as part of the takeover.
The League has not responded to the charges, but it is probable that it will investigate the facts provided.
A Chelsea spokesperson said: “These allegations pre-date the club’s current ownership. They are based on documents which the club has not been shown and do not relate to any individual who is presently at the club.”