Premier League's Profitability And Sustainability Rules To Be Replaced This Summer

The much-talked-about Premier League profitability and sustainability rules (PSR) are expected to be replaced by a new financial regulation framework as early as this summer, it was revealed on Monday.

Premier League teams voted to replace sustainability and profit criteria with a spending control mechanism modeled after UEFA. Clubs will be permitted to use a portion of their revenue, such as salary and transfer fees, to cover expenses under the new rules.

These rules will eventually restrict the amount of money clubs playing in European competitions can spend on player salaries, transfer fees, and other expenses to no more than 70% of their total revenue.

With a sliding scale of sanctions in place where clubs exceed that percentage, the Premier League has been looking at a mechanism that allows clubs to spend up to 85% of revenue on squad costs.

At the league’s annual general meeting, in June, there is no assurance that the new financial model will even be approved. The continuing cases involving Everton, Nottingham Forest and Manchester City will all continue to be evaluated using the current financial models if the new regulations are accepted.

Following a shareholders’ meeting on Monday in London, Premier League clubs declined to make any additional funding offers to the English Football League (EFL).

“At a Premier League Shareholders’ meeting, clubs agreed to prioritise the swift development and implementation of a new League-wide financial system,” a Premier League statement read, as per Sky Sports.

“This will provide certainty for clubs in relation to their future financial plans and will ensure the Premier League is able to retain its existing world-leading investment to all levels of the game,” the statement added.

There had previously been talk of a six-year agreement that would give the EFL 14.75% of net media revenue from the Premier League; this arrangement is estimated to be worth approximately £900 million. However, Premier League clubs are currently prioritizing their own financial model agreement before contacting the EFL.

Though it has stated time and time again that it wants the football authorities to reach a new financial settlement amongst themselves, the government has also issued a warning that they may be forced to do so by ‘backstop’ powers that would be granted to the new independent regulator.