Explained: Why Leicester will avoid points deduction this season despite allegedly breaking PSR rules - but they could be hit with sanctions upon return to Premier League

The Premier League's PSR rules have seen a lot of the headlines in the media this season amid a crackdown on breaches, with teams like Everton, Nottingham Forest and Sheffield United being hit with points deductions. However, despite Leicester having allegedly breached the rules as well, they will not be docked points from their Championship tally due to legal restrictions.

After being charged for the breach last month, the Foxes took up legal action against the English Football League (EFL) by claiming that a points deduction in the Championship for their offenses in the Premier League would be unlawful. Following the legal recourse, the EFL has now agreed that the limitations in the regulations will not allow them to dock points from the Championship league leaders.

In a statement, the EFL announced: "Having taken legal advice, the EFL has confirmed to all parties that whilst it would want to respect any decision of a Premier League disciplinary commission (and vice versa) to deduct points in the EFL, it does not have the power under the regulations as currently drafted."

Earlier this month, Leicester confirmed losses of £89.7 million ($112.7m) for the 2022-23 season which took their total losses over the last three seasons, all of which they spent in the top-flight, to a total of £215m ($270.2m). The Premier League permits under £105m ($132m) of losses over a three-year period which brought around their breach of the PSR rules.

While the EFL cannot dock the Foxes' Championship points tally, the Premier League will likely hit them with a points deduction upon their return to the top-flight, which will likely be in the upcoming season with Leicester leading the charts in the Championship.