Everton have been deducted 2 points for a second breach of Premier League financial rules. Profit and sustainability rules (PSR) permit clubs to lose £105m over 3 years and an independent commission found Everton breached that by £16.6m for the 3-year period to 2022-23.
The Toffees had a ten point deduction reduced to 6 on appeal in February for the 3-year period to 2021-22. They drop one place to 16th and are now 2 points above the relegation zone. The club will appeal against the decision.
The Merseyside club could yet face a further points deduction in relation to interest costs associated with the building of the club’s new stadium at Bramley-Moore Dock, though that issue is unlikely to be resolved before the end of the season.
In its written reasons the independent commission said the Premier League had asked for a five-point deduction for the club.
The commission decided that any breach of PSR justifies a three-point deduction, with an additional two points because Everton’s breach of £16.6m – 15.8% above the £105m threshold – is deemed significant.
However, the commission accepted Everton’s arguments for mitigation in relation to the fact the club has: Already been deducted points this season, suffered a loss of revenue because of the suspension of a sponsorship deal with Russian company USM and made an early admission of guilt
The commission concluded that the fact Everton have already been punished this season “for losses in years which overlap with the years at issue in these proceedings” merits a two-point reduction in punishment, with a further point for the loss of sponsorship revenue and early admission of guilt.
It also said that the club and league remain in dispute over costs related to the new stadium – with the Premier League saying these costs should count as PSR losses, while Everton argue they should be excluded and have capitalised them on their latest audited accounts.
The same independent commission will meet to decide the issue at a later date and, if it agrees with the Premier League, could issue further punishment.
However, the commission said this issue cannot be dealt with using the expediated PSR process introduced this season so is unlikely to be resolved before the end of the campaign.
An Everton statement read: “While the club’s position has been that no further sanction was appropriate, the club is pleased to see that the commission has given credit to the majority of the issues raised by the club, including the concept of double punishment, the significant mitigating circumstances facing the club due to the war in Ukraine, and the high level of co-operation and early admission of the club’s breach.”
The Toffees added that the club is “extremely concerned” at the “inconsistency” of the punishments, with four different commissions issuing four different points deductions this season.
The Premier League said the independent commission “reaffirmed the principle that any breach of the PSRs is significant and justifies, indeed requires, a sporting sanction”.
Nottingham Forest are the other Premier League club to have been charged with PSR breaches this season and were docked 4points in March, although they have lodged an appeal.
Championship club Leicester have also been charged by the Premier League for allegedly breaking spending rules during their last 3 seasons in the top flight.
There is no guarantee that Everton’s appeal will be heard before the final games of the Premier League season on 19 May when Everton travel to Arsenal.
The 2023-24 season technically remains ‘live’ until the annual general meeting in June when relegated clubs transfer their certificates and 24 May has been selected as a ‘backstop date’ for the appeals process to be concluded.
