LONDON, Feb 23 (Reuters) – English professional soccer is set for its most radical overhaul since the rules were invented more than a century ago, the Government said on Thursday as it announced its plan to create an independent regulatory body.
Its wide-ranging white paper ‘A sustainable future – reforming club football governance’, published on Thursday details the powers that the regulator, once made law, will have.
Its primary duties would be: club sustainability, systemic stability and cultural heritage.
Here is what it will do.
The Government says an independent regulator, one of the recommendations of a fan-led review, is required because of the ‘underlying fragility’ of the English soccer pyramid.
While the Premier League is held up as the benchmark for successful soccer leagues, the landscape below that is littered with tales of clubs getting into financial turmoil and being bought by unscrupulous owners.
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The Government says it needed to act to protect historic clubs and, according to Sports Minister Stuart Andrew ‘ensure that fans have a greater voice’ in the running of their clubs.
The regulator will operate a licence system with all clubs in the top five tiers requiring a licence to compete. A licence would be issued only if a range of conditions are met, including a sustainable business model, suitable ownership, fan interests being met and agreeing to compete only in competitions approved by the Regulator.
The fan-led review highlighted historic clubs ending up in financial distress after being bought by unsuitable owners, sometimes with histories of bankruptcy or criminal convictions.
A new owners’ and directors’ test would be implemented with three key elements: fitness and propriety, enhanced due diligence of source of wealth and requirement for robust financial plans.
The Regulator would have the power to prevent English clubs from joining future breakaway competitions that do not meet pre-determined criteria.
In theory, the situation that occurred in 2021 when six Premier League clubs signalled their intention to join a European Super League only to make U-turns after a backlash across the game, would not be allowed to happen again.
“The regulator will have the power to prevent English clubs from joining new competitions that do not meet a predetermined criteria, in consultation with the FA and fans,” the Government said. “That criteria could include measures to stop clubs participating in closed-shop breakaway competitions which harm the domestic game, such as the European Super League.”
“Without fans, football clubs are nothing. We would all do well to remember that as we work towards reform to secure a brighter future for football,” says Sports Minister Andrew.
The Regulator would set a minimum standard of ‘fan engagement’ as part of its licensing regime, including on issues such as name changes, stadium moves and even changes of kit.
Clubs would have to show that they are regularly consulting a representative group of fans on key strategic matters at the club.
The Government says the current distribution of revenue is not sufficient and has a destabilising effect on the football pyramid. It says 83% of revenue earned by clubs in the top five divisions sits within the Premier League, compared to 57% when the Premier League was formed in 1993.
Although a football industry-led reform is its preference, the Government says the regulator would be given targeted statutory powers to intervene as a ‘last resort’ should a fairer system of wealth distribution not be achieved.
The English Football League is pushing for a 75-25 percentage split of the 3.5 billion pounds ($4.2 billion) the Premier League generates annually in television rights.
The Premier League says it has addressed issues raised in the Fan-Led Review and that 1.6 billion pounds is being reinvested down the pyramid over the next three seasons.
The Regulator would operate an ‘advocacy-first’ but with the power and mandate to intervene ‘swiftly and boldly’ if clubs fail to meet conditions of the licensing system. The Government says it would have a range of powers including strong sanctions on clubs and individuals, to deliver its licensing system with disqualification of owners or directors in extreme cases.
The Government says it is committed to establishing the independent Regulator as ‘soon as Parliamentary time allows’ and that it will not happen overnight.
In the mean time it will engage with a range of stakeholders in the game including the Premier League, The Football Association and English Football League.
It is unlikely the independent regulator would be fully operational before the 2025-26 season.
($1 = 0.8305 pounds)
Reporting by Martyn Herman
Editing by Toby Davis
Our Standards: The Thomson Reuters Trust Principles.
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