In response to Chelsea’s recent pattern of signing players on long-term contracts, UEFA is changing its Financial Fair Play rules.
When Chelsea submits its annual accounts, signing players on prolonged contracts allows them to spread the player’s transfer fee over the duration of the deal.
That means Mykhailo Mudryk, who cost £89 million, will be paid £11 million each year for the next eight and a half years of his contract.
A transfer price will be dispersed over a five-year period, according to UEFA.
Clubs will still be able to offer longer contracts under UK regulations, but transfer fees will be limited to the first five years.
The new Financial Fair Play standards will go into effect in the summer and will not be retroactive.
France defender Benoit Badiashile and Ivory Coast striker David Datro Fofana both signed six-and-a-half year deals at Chelsea earlier this month and Noni Madueke joined on a seven-and-a-half year contract following Ukraine winger Mudryk’s arrival.
Defender Wesley Fofana moved to Stamford Bridge on a seven-year deal and left-back Marc Cucurella joined on a six-year contract last summer. Raheem Sterling’s deal is five years.
The Madueke transfer took Chelsea’s spending since last summer close to £450m, but the players’ long contracts will help them comply with the regulations.
The Blues have to adhere to two sets of regulations – the Premier League’s profit and sustainability rules and, as they regularly play in European competition, UEFA’s Financial Fair Play regulations.
Under UEFA’s current rules, clubs can spend up to 5m euros (£4.4m) more than they earn over a three-year period. They can exceed this level to a limit of 30m euros (£26.6m) if it is entirely covered by the club’s owner.
The governing body has a wide list of potential punishments for clubs that break these rules, ranging from warnings to fines and even the loss of European titles.
However, new UEFA rules introduced last June limit clubs’ spending on wages, transfers and agents’ fees to 70% of their revenue, although permitted losses over a three-year period have risen to 60m euros (£49.96m).
A gradual implementation of the regulations has been agreed, with the percentage set at 90% of revenue in 2023-24 and 80% in 2024-25 before reducing to 70% in 2025-26.
The Premier League’s separate rules allow for total losses of £105m over a three-year period. Any club that posts losses in excess of that figure could face penalties, including large fines or even a points deduction.