Following the rejection of a £135 million Premier League transaction, Newcastle United’s threat of a points deduction was denounced.

A threat of a points deduction against Newcastle United was rebuffed after a £135 million Premier League transaction was halted.The financial regulations of the Premier League, which have

restricted the transfer market for clubs such as Newcastle United, have been criticized by a football finance expert as “farcical.” Kieran Maguire is of the opinion that the limit of £105 million losses over a rolling three-year period for Premier League clubs, which was implemented more than a decade ago, should be revised to account for inflation.

The cap, according to Maguire, was instituted without any logical justification and has impeded the transfer market for numerous clubs, including Newcastle. The Aston Villa lobbied unsuccessfully over the summer to increase the permitted losses to £135 million in accordance with the Bank of England’s inflation guidance. This would result in the £105 million cap that was implemented in 2013 being worth £143 million. However, the change was ultimately obstructed when Villa owner Nassef Sawiris proposed that the Premier League be sued for violating its regulations. Since the 2021 acquisition by the Saudi Arabian Public Investment Fund, Newcastle has made substantial expenditures. However, the Premier League Profitability and Sustainability Rules have restricted their transfer market activity and the PIF’s spending power in recent windows. In order to satisfy the allowable losses threshold and prevent a points deduction, the club felt compelled to sell Elliot Anderson and Yankuba Minteh over the summer.

Newcastle and Villa have been able to disrupt the so-called “established elite” in the Premier League by qualifying for the Champions League in recent seasons, despite having lesser wage bills, transfer budgets, and commercial revenue. Maguire contended that the “completely farcical” regulations were implemented to prevent teams such as Villa and Newcastle from competing with the “big six” in the context of the Price of Football. “I do have sympathy for those clubs who have been acquired since 2013 and whose owners have not been allowed

to spend as much money as their predecessors,” Maguire asserted. “However, you must subsequently revisit the rationale behind the implementation of these regulations.” “I am of the opinion that the regulations were implemented not to establish financial sustainability, and certainly not to generate profitability, as it does not exist. Rather, they were intended to prevent the big six

from morphing into a big seven or a big eight.” At present, that is the situation.The current limit of £105m would be £249m if it had been index-linked in accordance with the revenue of Premier League football clubs. If you were a supporter of Nottingham Forest or Everton, you would be wondering, “How much would we lose in terms of points?” Naturally, the response would be a large, obese zero.

Additionally, it would have enabled clubs such as Aston Villa and Newcastle to increase their investments, a fact that is evident from the pronouncements of their proprietors.

“If the limit had been raised in accordance with Premier League wages, it would have increased from £105m to £230m, which is approximately the same amount. However, the most remarkable example is when the PSR limit was linked to the increase in transfer fees in terms of the number of players purchased by the Premier League.” The £105m would be equivalent to £504m today,

meaning that a club could experience a loss of half a billion pounds over the course of three years and remain within the regulations. “It appears that certain clubs are receiving an unfair advantage.” Simultaneously, those who advocate for lower limits will inquire, “What if the owner’s circumstances change?” When the proprietor’s enthusiasm wanes, what transpires? Or, as we observed with Roman Abramovich, have his assets been frozen? That is an inherent peril in life. That is a potential risk in the commercial world.