Home Championship Derby County vow to ‘strongly contest’ EFL’s ‘unlawful’ charge over breach of spending regulations

Derby County vow to ‘strongly contest’ EFL’s ‘unlawful’ charge over breach of spending regulations

by Football Frenzied

Derby County vow to ‘strongly contest’ EFL’s ‘unlawful’ charge over breach of spending regulations as they claim body cannot act because it knew about £80m Pride Park sale

  • Phillip Cocu’s side are facing a 21-point deduction after being charged
  • EFL rules state clubs can lose no more than £39million over a three-year cycle
  • But Derby have released a statement disputing the charge given out by the EFL
  • The League’s case against Derby is understood to rest on the sale of Pride Park

Derby will ‘strongly contest’ EFL’s charge over breach of spending regulations which could see the Championship club relegated to League One.

Phillip Cocu’s side are facing a 21-point deduction after being charged with breaking profit and sustainability (P&S) rules for the three-year period ending June 2018.

EFL rules state clubs can lose no more than £39million over a three-year cycle.

Derby County have been charged by the EFL for making excess losses under FFP regulations

But Derby have released a statement disputing the charge as they said: ‘The club will strongly contest the challenge to the valuation of Pride Park stadium, as well as the newly notified charge in respect of intangible fixed asset amortisation.

‘As a matter of law, the EFL is not entitled to bring either of the charges, having previously agreed to all of the arrangements surrounding the stadium sale and never having raised the issue of player amortisation before. The Club shall argue that the very bringing of the Charges itself is unlawful.

‘At all times, the Club has acted transparently with the EFL in its submissions for both FFP/P&S and, in respect of the charges above, had received written approval for all of its submissions in respect of this legislation. 

‘No allegation has been raised to the contrary by the EFL. Rather, the EFL now claims that it made a “mistake.”’

The League’s case against Derby is understood to rest on the controversial sale of Pride Park, which was sold to a company controlled by the club’s owner Mel Morris for £80m two years ago and leased back the club. 

Derby recorded the losses over a three year period which concluded on June 30 2018

Derby recorded the losses over a three year period which concluded on June 30 2018

Following the sale, Derby recorded a pre-tax profit of £14.6m last April, which enabled them to comply with the P&S regulations.

The EFL launched an investigation into Derby’s valuation of Pride Park at the start of this season, as their rules state that any property sales and commercial deals included in club accounts must be at fair market rates.

Sportsmail have been told that the EFL’s independent valuation deemed Pride Park to be worth approximately £50m. They have therefore accused Derby of overvaluing the asset by £30m. The club stand by their valuation and insist they complied with the rules throughout, so the stage is set for a lengthy legal battle.

Derby’s case will be heard by a three-person independent panel, who have the power to impose a large fine and dock the club up to 21 points in line with the EFL’s fixed P&S tariffs, which were introduced three years ago.  

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Source: DailyMail

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