LEC Lowers Team Salary Cap for 2027

After three years under the current format, the League of Legends EMEA Championship (LEC) is set for one of its biggest overhauls in 2027, including a significant reduction to the maximum threshold.

How do the Sporting Financial Regulations Work?

In 2027, the league's Sporting Financial Regulations (SFR) will see the maximum threshold reduced from €2 million to €1.65 million. The change, announced on the EMEA Competitive Operations website, will limit the total payroll of each team's five highest-paid players.

Teams will have a €1.65 million budget covering player salaries, bonuses, and additional compensation, including image rights. However, players' personal sponsors, cash prizes, or housing assistance are excluded from the calculation. 

If a team exceeds the €1.65 million threshold, it will pay a luxury tax, with the collected funds redistributed to support the league's economic sustainability and competitive balance. 

However, teams will have a 5% margin above the threshold throughout the year, meaning they will not be sanctioned for exceeding the €1.65 million limit within 5%. They will still be required to bring their payroll back within the threshold the following season or face penalties.

On the other hand, the SFR minimum is also set to be reduced from €1 million to €825,000. Clubs that fall below the minimum threshold will not face direct penalties, but Riot Games and the league will withhold a portion of their revenue.

LEC to lower team salary cap from €2 million to €1.65 million in 2027 (Photo by Michał Konkol/Riot Games)

Tighter Regulations

Beyond the threshold changes, version 1.3 of the SFR introduces stricter accounting rules to prevent teams from circumventing the salary cap. Termination payments, financial settlements, and early-release fees will now count toward a team's seasonal payroll.

The LEC can also reclassify payments based on their actual purpose, including leadership and conduct bonuses, while teams must provide detailed financial statements. Additionally, the notice period for changing the Baseline Threshold has been reduced from three seasons to two.

To prevent teams from being negatively affected by sudden regulatory changes, the LEC has introduced a grandfathering clause known as a “Special Reduction.”

Under this rule, players who signed their contracts before the new salary limits took effect will only count toward the regulated budget up to one-fifth of the league-wide threshold if their actual salary is higher.

The SFR minimum will be reduced from €1 million to €825,000 (Photo by Michał Konkol/Riot Games)

More SFR Changes Are Coming to the LEC

However, more changes to the SFR are still to come in the following years. As Riot Games previously announced, the LEC will introduce further updates to the regulations for the 2028 and 2029 seasons.

The changes for 2028 will be announced by September 30, 2027, while the 2029 updates will be revealed by the same date in 2028.

SFR Threshold Season Over Season (Photo by Riot Games)

Major Regions Reshape Their Financial Rules

To curb rising payrolls and promote long-term financial sustainability, both the LCK and LPL are introducing stricter controls on team spending.

In China, the LPL continues to enforce league-wide spending limits and individual salary caps, encouraging organizations to invest more in developing domestic talent rather than relying on expensive imports and high-value contracts.

Meanwhile, the LCK will introduce significant SFR changes in 2027. The salary cap will remain at 4 billion won (around €2.5 million) for a team's five highest-paid players.

However, the LCK will replace its current exemptions with a simpler “six-point rule,” which is based on the number of titles a player has won in the past three years. These exemptions will also be limited to two players per organization.

Alongside tighter exemption criteria, the LCK is introducing a four-tier progressive luxury tax, with rates reaching 60% for teams spending more than 250% of the salary threshold.

To ease the transition, contracts signed before July 19, 2026, will benefit from a grandfathering clause providing temporary tax relief.

Gen.G among the teams most affected by the SFR changes (Photo by LCK/Riot Games)

Gen.G CEO Arnold Hur commented on the changes, acknowledging that they will make things more difficult for the organization.

However, he said Gen.G will not use the new rules as an excuse, instead focusing on adapting and finding a way to succeed under the new system.

"This change does make things harder for us. I'm not going to pretend it doesn't, but I'm not going to use it as an excuse either. The game changed and it didn't change in our favor, so now we go figure out how to win under it."

Gen.G Arnold Hur

These changes will require teams to approach future transfer windows with greater financial discipline, making roster building more dependent on careful budget management alongside player acquisition.

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Featured Image Credit: Kirill Bashkirov // Riot Games

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