Premier League clubs agree to new financial rules to replace PSR

Premier League clubs have agreed to trial an alternative league-wide financial system alongside the Profitability and Sustainability Rules (PSR) ahead of the 2024-25 campaign.

The decision to trial Squad Cost Rules (SCR) and Top to Bottom Anchoring Rules (TBA) was taken in Thursday’s Premier League’s Annual General Meeting, where they also voted in favour of keeping VAR.

SCR is meant to regulate a club’s on-pitch spending to 85 per cent of its revenue and net profit and loss on player sales, while TBA is being trialled to protect the “competitive balance of the league”.

In April, Premier League clubs agreed in principle to introduce squad cost ratio rules to replace PSR. However, the league has said it will remain in place once again next term.

The statement read: “At the Premier League’s Annual General Meeting today, clubs agreed to trial an alternative League-wide financial system next season (2024/25) on a non-binding basis.

“The existing PSR will remain in place, but clubs will trial SCR and TBA in shadow.

“This will enable the League and clubs to fully evaluate the system, including the operation of UEFA’s equivalent new financial regulations, and to complete its consultation with all relevant stakeholders.

Clubs agreed to trial an alternative League-wide financial system next season on a non-binding basis

The existing Profitability and Sustainability Rules will remain but clubs will trial Squad Cost Rules and Top to Bottom Anchoring Rules in shadow

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— Premier League Communications (@PLComms) June 6, 2024

“The overall system aims to improve and preserve clubs’ financial sustainability and the competitive balance of the Premier League, promote aspiration of clubs, facilitate a workable alignment with other relevant competitions and support clubs’ competitiveness in UEFA club competitions, while providing certainty and clarity for clubs, fans and stakeholders.

“SCR will regulate on-pitch spend to a proportion of a club’s football revenue and net profit/loss on player sales.

“TBA is a League-level anchor linked to football costs, based on a multiple of the forecast lowest central distribution for that season. It is designed to be a pre-emptive measure to protect the competitive balance of the Premier League. This protection is intended not to have an impact unless significant revenue divergence of clubs occurs.”

It has been reported that a proposal from Aston Villa to push up the upper limit of losses over a three-year rolling period from £105million to £135m did not get voted through.

These amendments come after both Everton and Nottingham Forest were handed points deductions, of eight and four respectively, in 2023-24, for previous financial breaches. Both teams stayed up, however.