Nottingham Forest ‘LOSES appeal against four-point deduction’ for breaching Premier League spending rules
WHO IS SUBJECT TO FFP RULES AND HOW MUCH CAN THEY LOSE?
In England, all Premier League clubs must comply with the Profit and Sustainability Regulations (PSR) which state they cannot lose more than £105 million over a three-year period. In the EFL, the rules differ depending on which division a club is in. In the Championship, Profit and Sustainability (P&S) rules state that clubs are allowed to lose up to £39 million over three years. In Leagues One and Two, clubs follow the Salary Cost Management Protocol (SCMP) which states that each club can only spend a fixed percentage of their income on wages. This limit can also be affected by equity injections or net transfer spending.
ARE ALL CLUB EXPENSES AND INCOME PART OF THE FFP CALCULATIONS?
Income yes. No spending – and this is where the complications come in. Clubs are allowed to spend money on infrastructure, women’s teams and academy fees without that money fitting into their budget. In Everton’s previous 10-point sanction, which they saw reduced to six after appeal, one point of contention was interest owed on loans the club said were linked to their new stadium, which the Premier League has disputed.
WHAT DID THE FOREST DO WRONG?
Given their promotion from the Championship, Forest had to play by different rules and their permitted losses were less than £61 million. Indeed, their top-flight campaign had an allocation of £35 million, with £13 million for each of the two second-tier seasons. Forest have, as we know, signed 43 players since winning the play-off final in May 2022.
WHY HAS THERE BEEN A RECENT INCREASE IN CHARGES?
P&S came into play during the 2015-16 season. The simple answer is that the “spike” has happened now because the three clubs involved – if we include Manchester City – were only recently found to have broken the rules.
WHAT IS THE APPEAL PROCEDURE, WILL DEDUCTIONS APPLY THIS SEASON AND WHAT DEFENSE CAN CLUBS HAVE?
A club has a fortnight to respond and a hearing must be completed in early April – before an appeal is heard. If an appeal were to be lodged, the procedure could continue until the end of May, beyond the end of the season. Due to the subjectivity involved, clubs can appeal in a number of areas. With Forest, they are expected to claim to have sold Brennan Johnson to Tottenham on deadline day in August for a higher fee (a club record £47.5m) than they would have received in June – before the end of the financial year. but it remains to be seen whether this would work.
WHAT IS THE GREATEST PENALTY A CLUB COULD BE HIT IF IT IS FOUND GUILTY?
There is no sanction policy or defined range of sanctions. Instead, any sanction is in the hands of the independent commission appointed by the Premier League, and the rules are “open”. It is likely that the most severe sanction would take the form of a hefty points deduction which could make an offender’s relegation a formality.
By Mike Keegan
