Chelsea are facing possible fines and a ban from European competitions after UEFA rejected their attempt to offset financial losses.
This comes after the club included the £200 million sale of their women’s team to a sister company, BlueCo, as legitimate income.
The sale, alongside two hotels, helped Chelsea stay within the Premier League’s profit and sustainability limits, avoiding domestic sanctions despite over £1 billion spent under co-owner Todd Boehly.
But UEFA has refused to recognize the transaction, citing rules that exclude intra-company asset transfers from permissible revenue.
As it stands, Chelsea’s three-year losses total £358 million, well beyond UEFA’s allowable threshold of €200 million (£170m).
The governing body has now entered negotiations with the club, which could result in a settlement payment and a mandatory three-year spending plan.
Failure to comply could trigger a one-season ban from European competition.
The outcome of UEFA’s deliberation is expected in May.
Compounding Chelsea’s financial strain is UEFA’s updated cost control regulation.
The current cap that allows clubs to spend 80% of revenue on transfers, wages, and agent fees will drop to 70% from next season, tightening the screws further.
Chelsea will need to make significant structural and operational adjustments to avoid severe penalties.
