The new approach to spending will replace the league’s current rules on profitability and sustainability.
English Premier League clubs voted for new ones by a majority of votes rules for spending funds for Premier League participants, which will come into force from the season 2025/26 and will replace the league’s current “profitability and sustainability” (PSR) guidelines.
The new rules, which clubs voted on today in London, mean between 70% and 85% of clubs’ annual revenues can be spent on the squad, namely player wages, amortized transfer fees and agency fees.
Clubs that do not play in Europe will be able to spend 85% of the revenue on their squad. For participants in European cups, the restriction will be more stringent – only 70 percent of income, which corresponds to UEFA rules.
However, that’s not all. An additional restriction on spending will be the so-called “binding coefficient”. It is still being discussed and could be a number of 4.5, 5 or 6. What does this mean? This coefficient will determine the maximum spending ceiling, which is a multiple of the minimum amount of TV revenue earned by the worst club in the league.
For example. The 20th-placed Premier League currently earns £103.6 million from TV broadcasts. If the peg factor is expected to be 4.5, the cap on squad spending for any league club would be £466m.
Three clubs reportedly voted against the new rules at today’s meeting: Manchester City, Manchester United and Aston Villa. Another club, Chelsea, abstained.
This vote was not final. The new rules will be approved by a final vote of Premier League clubs, which will take place later this year. If successful, the innovation will come into effect from the 2025/26 season.
Let us remind you that according to the current PSR rules, clubs cannot exceed the allowed loss limit of 105 million for three seasons. Everton, who were deducted points twice, and Nottingham Forest have already suffered from this restriction this season. Both clubs have already filed appeals, the verdict on which could be rendered before the end of the season or shortly after it ends.
Source: Sportarena
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