Baggies deny rules breach

West Bromwich Albion are facing a possible points deduction after being charged with an alleged breach of the EFL’s Profit and Sustainability  (P&S) regulations.  The charge relates to the three years ending with the 2024-25 season, with Championship clubs allowed to lose £41.5million ($56m) over that period.

According to the club accounts posted on Companies’ House, West Brom lost £7.6m in 2022-23, £37.6m in 23-24, and £18.8m in 24-25, amounting to a pre-tax loss of £64m.

P&S allows exclusions from this total for “healthy” expenses, such as long-term infrastructure or community projects, which can be added back from the loss calculation.  This includes the Category One academy, which costs the club several million pounds per season in operating costs. Accounting for these exclusions, the breach is thought to be marginal.

Under the EFL’s regulations, sporting penalties from the previous term must be applied in the following term, suggesting any potential points deduction will be taken from this season’s total.

The EFL’s base punishment for a P&S breach is 12 points, but it is softened based on the severity. For example, the deduction is reduced to three points if the breach is less than £2m, four points if between £2 and £4m, up to 12 points if the breach is greater than £15m.

There can also be further deductions from the base 12-point penalty if the loss in the final season is less than the season before. In West Brom’s case, their losses halved in 24-25 compared to the 23-24 term, the second of the three seaso period in question. The EFL Board can also request up to an additional nine-point penalty for “any aggravating factors and any other penalty it feels appropriate”.

West Brom released a statement in response to reports of the charge on Monday afternoon.    The statement reads: “The club considers that it has fully complied with the P&S rules. The club will continue to co-operate with the EFL’s Club Financial Reporting Unit and looks forward to resolving this matter.”

Bilkul Football WBA, a company owned by American businessman Shilen Patel, completed a takeover of the West Midlands club in February 2024 from Chinese businessman Lai Guochuan.

West Brom have been operating under an EFL “business plan” that limited their football spending during the period under scrutiny, which further complicates the assessment of their case. The charge follows West Brom posting their financial figures for the 2024-25 season, although industry experts calculate that any infringement, should the charge be proven, would be a “small breach”.

According to the EFL’s financial rules any sporting punishment, such as a points deduction, must be applied the season after the breach — which would mean this season in West Brom’s case — but time is now running out, with only four games remaining in the 2025-26 campaign. A transfer embargo and/or a fine are also potential punishments.

Any club handed a so-called “sporting sanction” has a period of ten working days to lodge an appeal, which would take any final decision well into the close season. But the EFL does not publish its fixtures until June 25, raising the theoretical prospect of West Brom surviving relegation, only to be demoted retrospectively should they be found guilty and handed a points deduction.

West Brom will have 14 days to respond from the date of the official charge. The EFL regular season ends in 19 days’ time, on May 2, which may help West Brom argue that any points deduction should be deferred.

Football finance guru Kieran Maguire calculates that, when mitigating factors such as infrastructure and academy costs are factored in, West Brom’s declared loss will be about £42.6million — approximately £1.1million more than is allowable.

I doubt whether this matter will be resolved this season and any points deduction is likely to occur next season.