Premiership Rugby have confirmed that it has concluded its investigation into Leicester Tigers’ Salary Cap compliance for the seasons 2016-17 to 2020-21.
The investigation was initiated by Premiership Rugby’s Salary Cap Director, Andrew Rogers, using the strengthened powers introduced following a review of the regulations in 2020.
In summary, the investigation found that Leicester Tigers, and one or more club commercial partners, entered into arrangements whereby a third-party company made payments to the image rights companies of Leicester Tigers players. These payments should have been declared to the Salary Cap Director as salary, but they were not disclosed.
In each of the four seasons from 2016-17 to 2019-20, Leicester Tigers exceeded the Salary Cap by an amount below the ‘Overrun’ limit above which a formal charge may be brought for an alleged breach of the regulations. The club has accepted the findings, which means there will be no further disciplinary process or appeal. The level of fine imposed in these circumstances, known as an Overrun Tax, is calculated by a formula set out in the regulations.
As a result of the previously undisclosed payments now being counted as salary, the Salary Cap Director has determined that Leicester Tigers exceeded the Salary Cap by the following amounts:
2016-17: £147,750.00 (Senior Salary Cap £6,000,000; Overrun limit £325,000)
2017-18: £89,718.05 (Senior Salary Cap £6,400,000; Overrun limit £350,000)
2018-19: £55,886.69 (Senior Salary Cap £6,400,000; Overrun limit £350,000)
2019-20: £98,586.32 (Senior Salary Cap £6,400,000; Overrun limit £350,000)
During the relevant period, the Salary Cap Regulations stated that for the first £50,000 of Overrun, a club would pay a tax of £0.50 for every £1 of overspend. Beyond the first £50,000 and up to £200,000 of Overrun, the tax is £1 for every £1 of additional overspend.
Consequently, the breakdown of the Overrun Tax on Leicester Tigers is:
In addition, Leicester Tigers have been fined £17,900 for failing to disclose information about the above arrangements in the five seasons from 2016-17 to 2020-2021 inclusive. In respect of 2020-21 Tigers were fined for non-disclosure but there was no overrun of the Salary Cap.
This makes a total of £309,841.06 in fines and taxes.
Andrew Rogers, Salary Cap Director, said: “The review of Salary Cap Regulations provided stronger powers to monitor spending and investigate possible breaches of the cap in past seasons. Leicester Tigers have cooperated with my investigation and accepted the findings, which allows us to apply the sanctions detailed in the regulations. While we are satisfied that the arrangements which resulted in the overspend have been brought to an end, we will continue to assess all spending as part of our ongoing monitoring process at every club.”
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