Leeds United and Burnley decide against financial fair play legal action over Everton's £372m losses

Leeds United and Burnley have decided against taking legal action against Everton over the Premier League's financial fair play rules.

Late last season there had been a suggestion the two clubs could go to the courts to protest about the amount of money the Toffees were allowed to spend on transfer fees, wages and the like, giving them - they argued - an unfair advantage when there are Premier League restrictions on such things.

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Under what are officially called "profit and sustainability" rules, Premier League clubs are allowed to post losses of £105m over a three-year period. In the last three years, Everton have lost £372m.

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What has complicated matters is that clubs were given leeway because of Covid-19, which did huge financial damage across football and society in general. Everton claimed it had cost them £170m, which they were allowed to write off, saying it stopped them raising £41.6m in player sales.

Infrastructure spending is another area exempt from the rules, and Everton are in the process of building a long-awaited new stadium.

For comparison, Newcastle United, whose average Premier League gate last season was 13,000 higher than Everton's, estimated the impact on them at £40m, Leicester City £50m, Aston Villa £60m, and Leeds £23m.

Everton have always maintained the losses were run up in consultation with and with the approval of the Premier League, and it appears Leeds and Burnley have been convinced the league are satisfied with their compliance.

The Blues are expected to sell prize asset Richarlison to Tottenham Hotspur this summer.

Sheffield Wednesday and Derby County have been relegated from the Championship in the past two seasons as a result of points deductions because of different breaches of the Football League's financial fair play rules, and Reading came close to joining Derby in the third tier as a result of their deduction, but no points deduction has ever been levied for clubs breaking the Premier League's separate rules.