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An independent Commission has applied an immediate four-point deduction to Nottingham Forest FC for a breach of the Premier League’s Profitability and Sustainability Rules (PSRs) for the period ending Season 2022/23.
Nottingham Forest was referred to an independent Commission on 15 January, following an admission by the club that it had breached the relevant PSR threshold of £61 million by £34.5 million. The threshold was lower than £105 million as the club spent two seasons of the assessment period in the EFL Championship. The case was heard in accordance with new Premier League Rules, which provide an expedited timetable for PSR cases to be resolved in the same season the complaint is issued.
The independent Commission determined the sanction following a two-day hearing this month, at which the club had the opportunity to detail a range of mitigating factors. The Commission found that the club had demonstrated “exceptional cooperation” in its dealings with the Premier League throughout the process.
Notes
Profitability and Sustainability Rules (see Premier League Handbook Section E)
– All Premier League clubs are assessed for their compliance with the Profitability and Sustainability Rules (PSRs) each year
– Compliance is assessed by reference to the club’s PSR Calculation, which is the aggregate of its Adjusted Earnings Before Tax for the relevant assessment period
– A club’s Adjusted Earnings Before Tax figure for each season takes account of its profit or loss after depreciation and interest, but before tax, and then applies a series of ‘add backs’
– These ‘add backs’ are costs that the Premier League and its clubs recognise to be in the general interest of the club and football, for example investment in infrastructure, community, women’s football, youth development and depreciation of tangible fixed assets Exceptionally, in relation to years 2019/20, 2020/21 and 2021/22 COVID-19 costs were also permitted to be included as ‘add backs’
– Ordinarily, a club’s PSR Calculation is the aggregate of its Adjusted Earnings Before Tax over a three-year period. Following amendments made to the PSRs during COVID-19, the relevant figures for Seasons 2019/20 and 2020/21 are now averaged. In the present cases, therefore, the relevant period includes Seasons 2022/2023, 2021/2022, and the average Adjusted Earnings Before Tax for Seasons 2020/2021 and 2019/20
– A club will be in breach of the PSRs if its PSR Calculation over the relevant period results in a loss in excess of £105 million (with that threshold reduced by £22 million for each season that a club has been in the Championship during the relevant period)
– At the 2023 Annual General Meeting, Clubs agreed to bring forward the date for the submission of audited Annual Accounts for Clubs forecasting a loss to 31 December (in accordance to Rule E.50.2)
– The NFFC case proceeded in accordance with the new Standard Directions, set out at Appendix 1 to the Rules
– Clubs agreed to introduce Standard Directions for PSR cases (Appendix 1 to the Rules) that seek to ensure such cases are resolved in the same season the complaint is issued, with any sanction handed down prior to the subsequent Annual General Meeting. This provides certainty for the League, its Member Clubs and other stakeholders as to the membership of the League in the subsequent Season (Appendix 1 page 533)
Premier League investigations and independent Commissions
– The Premier League Board have the power to investigate any suspected or alleged breach of Premier League Rules.
– Where, following the conclusion of an investigation or otherwise, the Board believes that there is a suspicion or allegation of a Rule breach, it has a number of options available to it. One of these options is to issue a written compliant and refer the matter to a Commission.
– The League has access to an independent Judicial Panel, comprising a number of legal, financial and other experts. Members of the Judicial Panel are appointed by its independent Chair, Murray Rosen KC, an experienced barrister. It is the Chair who selects members of the Judicial Panel to sit on Commissions, which are independent of the Premier League.
– All proceedings are confidential and heard in private.
– There are a range of sanctions available to the Commission which include fines, points deductions and other sporting sanctions.
– At the conclusion of proceedings, a Commission’s final decision will be published on the Premier League website.
– For further information on the disciplinary process, please see Section W of the Premier League Handbook.
