With Chelsea FC spending over $950 million on transfers in the 2022–2023 season, the team’s fans have been celebrating the arrival of new players nonstop. From FIFA World Cup Young Player Award winner Enzo Fernández to four-time Premier League winner Raheem Sterling, Chelsea’s squad seems to be one of the most formidable clubs in all of Europe. Shattering all previous transfer records, the new American owners of Chelsea FC have set a new precedent for the world — but how sustainable will this spending spree be?
$1,002,223,006.75… A breakdown
To put it into perspective, here are a few mind-blowing facts: Chelsea FC spent more money in the current season than in the last four seasons combined; the second-highest transfer spend in the 2022–2023 season is way less than half of what Chelsea FC spent this season, with Manchester United spending $350 million on players across two transfer windows; only receiving about $96 million in income from selling players, Chelsea FC is also operating in the most significant net negative transfer spend at over one billion dollars.
Financial Fair Play
In 2011, the Union of European Football Associations (UEFA) enforced Financial Fair Play (FFP) rules as a means of ensuring that clubs operate within their means, which involves not spending more money than they generate. The Premier League, which Chelsea FC is in, has its own set of rules that are slightly more lenient but similar in nature.
In 2019, Chelsea FC rivals and recent Premier League winner Manchester City were also investigated for breaching FFP rules. They were almost permanently banned from participating in European competitions until an appeal reversed the decision and reduced their fine from $43.4 million to $14.5 million.
With such an impressive yet seemingly impossible recent transfer history, the club has been under strict scrutiny for breaching FFP rules but has managed to avoid consequences for the time being.
Abnormalities and evading FFP rules
Chelsea FC has a history of having an unnecessarily large squad, which has led to registration issues. The squad currently has 33 first-team players, of which only 25 can be registered. Previously, they would sign an abundance of young players, loan them out for development, and eventually profit from trading them. Throughout the years, this strategy has been controversial due to the concerning low number of breakthrough players returning from loans.
However, the current situation is unprecedented and somewhat unrelated to their previous problem. The club is making first-team level signings, each costing more than the other, with Enzo Fernández breaking the league’s transfer record. Chelsea FC was able to make all these signings and avoid punishments because of their ridiculously long contracts, keeping the annual spend under the maximum amount under regulation. While most players sign contracts for less than five years, Chelsea FC has dished out several seven- and eight-year contracts in the past transfer window to operate without punishment. For instance, Ukrainian wonderkid Mykhailo Mudryk is signed by Chelsea, allowing him an 8.5-year contract to escape FFP consequences.
Implications for the future
Currently, Chelsea FC are sitting mid-table in the Premier League and have only won two games so far this calendar year. They are far from being eligible for participation in European competitions, let alone the UEFA Champions League. In 2021, they made over $163 million from playing in the Champions League. Losing out on that sum of money could prove detrimental to their finances. The FFP rules of the Premier League state that clubs are not allowed to have a loss of $172 million across three years. Thus, not making the Champions League will cause serious problems for Chelsea FC, as they would lose a large amount of revenue.
Unlike North American sports leagues like the NBA and the NHL, there is no such thing as a draft system that allows a balance between the top and bottom teams in the Premier League. Therefore, the unfairness that money brings to sports is further exaggerated in the case of Chelsea FC. There may be a series of serious consequences in store for the football club and for the future of the sport, but as spectators, we can only speculate.