Explaining Leicester City’s true Financial Fair Play situation

Leicester City managed to only sign two players in the transfer window, releasing several, loaning one, and selling one. Here is the FFP-shaped reason why.

During the summer transfer window, the King Power club struggled to make any impact, and were the last club in Europe’s top five leagues to secure a signing. This frustrated supporters. A myriad of possible reasons were speculated upon.

Anything from having no money, too many players at the club, or even a failure to identify talent was thrown about. Of course, an underpinning conversation of ‘Financial Fair Play’ (FFP) regulations was ongoing. It seems FFP played the crucial role.

What is FFP?

FFP regulations are essentially sustainability requirements imposed upon football clubs. They exist for the primary and purest purpose of preventing wanton spending which jeopardises the longevity of the project.

To out it simply, no club can spend more than £3.9m over what they earn in commercial revenue, although there is an allowance of £26m over that amount should the costs be covered. The measures are spread over a three-year period to monitor sustainable growth and control spending.

Wages, transfer costs, and other such financial burdens are included within the regulations. Whereas capital investment in assets such as training grounds and stadium expansions are not included.