Everton were handed a 10-point penalty in the Premier League for breaching Financial Fair Play rules

Everton have been deducted 10 points this season for violating the Premier League’s profitability and sustainability rules.

The club was referred to an independent committee in March over alleged violations related to the 2021-2022 season, and a hearing was held last month.

Everton could have been fined or imposed a transfer ban, but the Premier League has now confirmed the points deduction penalty, which will see Sean Dyche’s side drop to 19th in the table, just above last-placed Burnley on goal difference.

A statement from the Premier League read: “An independent committee has imposed an immediate 10-point deduction on Everton FC for breaching the Premier League’s Profitability and Sustainability Rules (PSRs).”

“The Premier League issued a complaint against the club and referred the case to an independent panel earlier this year. During the proceedings, the club admitted that it had breached its own performance standards for the period ending in the 2021/22 season, but the extent of the breach remained in dispute.

“Following a five-day hearing last month, the panel decided that Everton Football Club’s accounting for the relevant period resulted in a loss of £124.5m, as claimed by the Premier League, which exceeded the £105m threshold allowed under the PSRs,” it concluded. The committee called for the need to impose a sporting penalty in the form of a 10-point deduction. This penalty has immediate effect.”

Everton, who previously said it would “vigorously defend” its position, plans to appeal the penalty, which it described as “completely disproportionate and unfair”.

A club statement read: “Everton Football Club is shocked and disappointed by the decision of the Premier League committee.

“The Club believes that the Commission imposed a sporting sanction that was disproportionate and grossly unfair. The Club has already communicated its intention to appeal the decision to the Premier League. The appeal process will now begin and the Club’s case will be heard by the Appeal Board appointed in accordance with Premier League rules in due course.” .

“Everton confirms that it was open and transparent in the information it provided to the Premier League and that it always respected the integrity of the process. The Club does not acknowledge the finding that it failed to act in good faith and does not understand that this was an allegation made by the Premier League during the course of the proceedings. The cruelty of The severity of the penalty imposed by the Commission is not a fair or reasonable reflection of the evidence presented.

“The Club will also be monitoring with great interest the decisions made in any further cases relating to the Premier League’s profit and sustainability rules. Everton cannot comment on this matter further until the appeal process has concluded.

What are the rules of profitability and sustainability?

All Premier League clubs are assessed for their adherence to the competition’s profitability and sustainability rules each year.

Their compliance with the aforementioned rules is assessed by reference to the club’s PSR calculation, which is its adjusted gross pre-tax profits for the relevant assessment period.

The rules stipulate that clubs are allowed to lose a maximum of 105 million pounds ($128.4 million) over three years, but Everton recorded losses of 370 million pounds between 2018 and 2021.

The club said in a statement last March that it was “fully confident” in its compliance with all financial rules and regulations.

is this happened before?

Everton’s hearing is only the second time such action has been taken, after Manchester City were hit with more than 100 Financial Fair Play charges last season.

The outcome in the City case has not yet been announced The athlete Reporting that the ruling – which will be subject to appeal – is likely to take a long time to reach.

Earlier this year, Chelsea’s new owners reported incomplete financial information relating to transactions made during the management of the previous owner, Roman Abramovich, between 2012 and 2019.

UEFA imposed a €10m (£8.6m, $11m) fine for the historic violation in July, while the English Premier League and Football Association continue to investigate.

There have been several precedents in the English Football League in recent years, but the penalty for violating profitability and sustainability rules in the top tier of English football is unprecedented.

In fact, on only two other occasions has a points penalty been imposed on a club in Premier League history.

Middlesbrough were deducted three points for failing to win a game in the 1996-97 season, while Portsmouth were handed a nine-point penalty in January of the 2009-10 season after entering administration.

Why were Everton referred to the committee in the first place?

The arrival of Farhad Moshiri in 2016 was supposed to be a game-changer for Everton, and the Anglo-Iranian was certainly a generous owner to begin with.

His first permanent manager as majority investor, Ronald Koeman, spent around £145m on players in his first summer in charge, and Moshiri provided a similar level of support to the three subsequent managers before Rafa Benitez and Frank Lampard inherited tougher budgets. .

This surplus included inflated sums spent on underperforming players with very few of them sold at a profit, leaving the club vulnerable to Financial Fair Play rules.

Staying within their limits has become Everton’s primary concern over the past four years. Had it not been for the Covid-19 pandemic and the subsequent permissible deductions from losses, they would have been in big trouble earlier.

They embarked on a series of cost-cutting measures, including player sales, but developments in March suggested Everton may not have been able to recover enough.

In March 2022, the club announced a loss of £120.9m in its annual accounts for 2020-21, leading to greater scrutiny, along with the anger of fellow strugglers Leeds and Burnley.

A joint letter signed by Leeds chief executive Angus Kinnear and Burnley chairman Alan Bess is believed to be what prompted the Premier League to investigate.

(Photo: Getty Images)