Everton, a Premier League club, has been hit with a two-point deduction by an independent panel for breaching the Premier League’s profit and sustainability rules (PSR). This is the second time this season that Everton has faced a points deduction. Premier League regulations state that a club cannot lose more than £105 million ($132.54m) over a three-year period. The independent Commission, after a three-day hearing last month, decided that the appropriate sanction for Everton’s breach of £16.6 million would be a two-point deduction, effective immediately.
Following the points deduction, Everton has dropped to 16th place in the Premier League table, just two points above the relegation zone. The Premier League has also indicated that there is a dispute regarding the accounting of Everton’s new stadium. The league believes that stadium funds should be recorded as losses in relation to PSR, while Everton holds a contrary view. This discrepancy may result in an additional penalty for Everton, which will be resolved at a later date. It is unlikely that the matter will be concluded this season. Everton has expressed their intention to appeal the decision and has begun preparations to do so, citing concerns about the inconsistency in the application of points deductions by different commissions.
The independent commission’s report revealed that the starting point for the deduction was five points, with each breach resulting in a three-point sanction, and an additional two points for exceeding the £16.6 million threshold. Ultimately, the commission settled on a two-point penalty for Everton due to various mitigating factors presented by the club during the hearing. These factors included Everton’s past punishments for breaches, the loss of sponsorship revenue due to geopolitical events, and the club’s early admission of breaching the PSRs. However, the committee rejected certain other mitigating factors, such as the construction of Everton’s new stadium, deeming them as normal occurrences for a professional football club. Additionally, the commission noted that Everton’s level of cooperation was not exceptional.
This is not the first time Everton has faced a points deduction this season for a PSR breach. In November, the club was initially docked 10 points by an independent commission, which was later reduced to six points on appeal. In January, Everton was charged with a second breach along with Nottingham Forest, resulting in penalties for both clubs. Nottingham Forest, facing relegation, received a four-point deduction in March, after the initial recommendation of six points was mitigated due to early plea and cooperation with the investigation. It is worth noting that Forest set a record for the most transfers by a Premier League club during the summer window following their promotion in the previous season.
In addition to Everton and Nottingham Forest, Manchester City has also come under the spotlight for alleged breaches of financial rules since the club’s acquisition by the Abu Dhabi-based City Football Group. Premier League chief executive Richard Masters has confirmed that a hearing date has been set for City’s case, although the specific date has not been disclosed. This demonstrates a growing emphasis on financial fair play and adherence to regulations within the Premier League.
The points deduction faced by Everton is a significant blow to the club and highlights the increasing scrutiny on financial matters within football. The decision by the independent commission underscores the importance of transparency and compliance with league regulations. As Everton navigates this challenging period, it is crucial for the club to address any underlying issues and work towards financial stability in order to avoid further sanctions in the future.
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