Everton has faced another setback with a further two-point deduction due to breaching the Premier League’s Profitability and Sustainability Regulations, sliding them down to 16th place, just two points away from the relegation zone. This compounds their already troubled season, having previously been docked 10 points, later reduced to six, after an appeal earlier in the season.
The Premier League’s Profit and Sustainability Rules (PSR) and UEFA’s Financial Fair Play (FFP) share similar goals but differ in their approach. FFP, enforced by UEFA, aims to prevent clubs from overspending and accumulating excessive debt, while PSR, the Premier League’s equivalent, ensures clubs operate sustainably within their financial means. While both aim to prevent overspending, they use different calculation methods and enforcement mechanisms.
Recent adjustments to financial regulations include the Premier League allowing clubs to incur a maximum loss of £105m over three seasons, while UEFA has replaced FFP with Financial Sustainability Regulations (FSR), which include a ‘squad cost ratio’ calculation linking spending to turnover.
Everton and Nottingham Forest have both faced charges for breaching PSR. Everton appealed a 10-point deduction imposed in November 2023, while Nottingham Forest admitted to breaching PSR by £34.5m, resulting in a four-point deduction and relegation zone placement.
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Leicester City also faced charges for an alleged breach of PSR, with proceedings scheduled according to an independent commission’s timetable after their relegation to the EFL Championship.
Manchester United and Barcelona were fined for FFP breaches in July 2023, with Manchester United receiving a €300,000 ($336,420) fine for minor deficits, and Barcelona fined €500,000 ($560,700) for incorrectly reporting profits.
Manchester City was first charged by UEFA for breaching FFP rules in March 2019, prompting the Premier League to launch its own investigation
In July 2020, the club had a two-year suspension from UEFA club competitions overturned by the Court of Arbitration for Sport (CAS)
In 2014, both Manchester City and PSG were heavily sanctioned by UEFA for breaching FFP rules. City was fined €60 million ($82 million), had a restriction on transfer spending, and a reduction in the club’s squad size for the European Champions League
PSG also accepted the same financial sanctions as City. Turkish clubs Galatasaray, Bursaspor, and Trabzonspor, as well as Bulgaria’s Levski Sofia, were fined and told to meet break-even limits
FFP regulations have been both criticized and supported. Critics argue that FFP limits the internal market, fails to reduce football club debt effectively, and protects the status quo. Supporters emphasize the importance of clubs living within their means and preventing financial doping.
FFP has also been seen as a positive mechanism for curbing player wage inflation, a concern for the investment community.
