"Premier League to Introduce New Financial Regulations Next Season: Clubs Vote on Transfer and Salary Caps"

Table of Contents

• New Financial Rules Approved
• Introduction of Squad Cost Ratios
• Failed Proposal for Anchoring
• Overview of the New System
• Unanimous Passing of Sustainability Rules
• Clubs' Opposition to Anchoring

PREMIER LEAGUE clubs have approved a new set of financial regulations – by the slimmest of margins.

However, proposals to impose a cap on the maximum amount any club could spend on transfers and wages were dismissed outright.

The Premier League is set to introduce a new set of financial regulationsCredit: Reuters

During today’s meeting in central London with the 20 “shareholder clubs,” officials received support from 14 members to implement Uefa-style “Squad Cost Ratios” starting next season.

This will limit all clubs to spending no more than 85 percent of their annual revenues on player expenses.

All clubs participating in competitions are restricted to spending 70 percent of that income each season.

Nevertheless, the proposal to introduce a system of “anchoring” – which would have restricted all clubs to spending a maximum of five times the broadcast income of the lowest-placed club – failed to achieve even a minimal majority.

This concept would have capped club spending at a maximum of £550 million next season, although only a few clubs would reach that figure.

Only SEVEN clubs supported the idea, while 12 voted against it and one abstained.

According to Premier League regulations, a two-thirds majority is required for any changes to the rules, meaning at least 14 clubs must approve it unless there are abstentions.

This decision marks the end of the existing Profitability and Sustainability Rules, which have seen clubs penalized for violations in recent seasons.

A Premier League spokesperson confirmed: “At a Premier League Shareholders’ meeting today, clubs voted to implement a new set of financial rules, which will take effect from the start of the 2026/27 season.

“Following extensive discussions, clubs agreed to adopt the Squad Cost Ratio (SCR) and Sustainability and Systematic Resilience (SSR) proposals.

“There was insufficient support for the proposal on Top to Bottom Anchoring.”

The SCR is a “real-time” calculation, allowing clubs to include ALL stadium income – such as concerts, conventions, and other sporting events, providing a boost for clubs with two games per season in addition to major musical performances.

As part of the approved proposals, clubs will have a “multi-year allowance of 30 percent” if they exceed the 85 percent limit.

Spending beyond 85 percent will incur fines, with breaches exceeding 115 percent resulting in automatic points deductions.

Any violations will reduce the points loss threshold for a club by the same percentage.

The Premier League added: “The new SCR rules are designed to create opportunities for all clubs to strive for greater success and align the League’s financial system more closely with UEFA’s existing SCR rules.

“Key features of the League’s new system include transparent in-season monitoring and penalties, protection against sporting underperformance, the ability to spend in advance of revenues, enhanced capacity for off-pitch investments, and a simplification by concentrating on football-related costs.

“The Sustainability and Systemic Resilience rules evaluate a club’s short, medium, and long-term financial health through three assessments – Working Capital Test, Liquidity Test, and Positive Equity Test.”

These latter rules were passed unanimously.

Premier League officials have been trialing both SCR and anchoring in a shadow format since the beginning of the 2024-25 season to determine whether the regulations should be officially adopted.

While SCR was anticipated to pass narrowly – the Profitability and Sustainability Rules were adopted by a very slim margin in 2013 – it had become evident in recent months that anchoring was likely to fail.

Manchester City and Chelsea were vocal opponents – with Red Devils executives looking forward to the revenue boost they expect from the new stadium – while other clubs are also believed to have shifted their positions.

Everton previously faced points deductions on two separate occasionsCredit: Getty