Financial Fairplay Investigation - 2025 Nobody in Breach

[Mouse]

Oh, of course, and how have they calculated 6 instead of 10 (or 4 or 5, etc)

[Mouse]

The table does look a lot better though, at least for a week or two!

[Evertonfc15]

happy with that - thought 5 or 6 was ok to be imposed given our circumstances not 10 in any way shape or form
like big nev says lets just get points on the board in every game

[Toshyboy]

Would hope this kills Luton’s spirit a little too

[Goaljira]

https://resources.premierleague.com/pre ... 260224.pdf

The reasoning is in here but I don’t want to read 61 pages. If any of y’all want to I would love a synopsis.

and (iii) the loss to the Club when it decided not to sue Player X whose contract was terminated following his arrest in relation to alleged sexual misconduct with a child.

So we terminated his contract then, and didn't just allow it to run down?

The Club lost the services of Player X. Player X was, at the time of his arrival, the Club’s record signing, and he was a successful and popular player. However, in Summer 2021, he was arrested on suspicion of child abuse and was suspended by the Club and then the FA. The circumstances of his suspension meant that the Club was entitled to terminate his contract which, on 23 August 2021, it did. In terms of the Club’s P&L Account (and, hence, the PSR Calculation) that resulted in the net book value of the player (£9.1m) being written off, and additional losses of £0.9m for wages paid to the player for the period before 23 August 2021 when he could not provide any contractual services because of his suspension. The Club also lost the services of Player X on the pitch. Whilst the Club was advised that it had an economically viable claim against Player X, it did not pursue it because of concerns about his psychological well-being. The charges against the player were ultimately not pursued.

So the club was happy to look like it was being the victim in paying him all through that last season, when in fact he'd been binned off? When was he removed from squad lists?

[Trowel]

So we were successful arguing on stadium funding, and then the proportionality

[dsaund]

From what I can gather of what I have read of the judgment so far, is that any breach under 15m incurs no penalty. So as long as our accounts have dropped enough for us to be under that limit but still in breach, there shouldn’t be a second deduction.

It also seems to suggest there is a minimum 3-4 point deduction for any loss over 15m and additional point per 2-2.5m over so I imagine that is how they got to 6 points

[Bluedylan1]

Ultimately, as much as it's something positive, the entire thing is still be going to hanging over us until late May so there won't be any respite from the wondering and agonising.

The only way we'll get any relief as fans is if we somehow move about 8-10 points clear of the relegation zone. And our last two games are going to be Arsenal and the other lot, so we can write that week off.

[cassius]

I wasn't expecting that, so on the balance I've got to be happy and I do feel more positive now, looking at the table.

Just got to put as many points on the board between now and the second charge.

[Blueomar]

Hoping that for the second charge the maximum we get is 2 additional points deducted, seeing as how we’ve been deducted points for 2 of the three years already.

[Evertonian in NC]

Super pleased. As long as Forest match our deduction for the next accounting period (expect we will each get 6), it would take a monumental collapse to go down.

[Gash]

Would hope this kills Luton’s spirit a little too

To be fair I think theories of some kind of revival are a bit of a myth, they're on a run of three defeats in a row one against Sheff Utd. They've played in some enjoyable games but their still losing most of them and they're only averaging 0.8 points per game.

[Evertonian in NC]

Yeah, it's not like Luton are good at all. And we will pick up a net 4 (in all likelihood) on Forest. 2 of those 3 will survive, and it might not even take 30 points to do so.

Timing is everything, and ours is perfect here!

[Shogun]

So the only talk of a deal with Usmanov for rights sponsorship came from minutes produced from a board meeting and as no documents had been drawn up of it then that weakened the argument. Commission also says that it wouldn't have stopped the club from significantly breaching the £105m limit. Also that clubs should prepare for any deal falling apart with other sponsorship deals in place.

The "Would have significantly breached anyway" line is interesting. Are they saying it doesn't matter if it's £9.5m or £19.5m?

Russian Sanctions

98. Mr Moshiri’s evidence was that he hoped Mr Usmanov would invest heavily in an
equity stake in the Club. The Club had already, on 7 January 2020, entered into
an option and naming rights agreement for the Club’s training facility and new
stadium with USM, Mr Usmanov’s company. This was to take effect from Season
2024-25, i.e. after the stadium had been opened; but, Mr Moshiri said, negotiations
had reached an advanced stage to bring this forward to FY22, so that the naming
rights sponsorship of £10m per season would commence during the construction
phase in that financial year. The possibility of this revenue in FY22 was lost, he
said, because of the sanctions imposed on Russian entities, including Mr Usmanov
and USM, as a result of the invasion of Ukraine; which meant that the Club had to
withdraw from further negotiations with him. This loss of chance, it was submitted,
should have been taken into account by the Commission as mitigation.

99. However, in the Commission’s view, this was not a head of mitigation upon which
the Club could successfully rely to reduce the penalty. It did not diminish the Club’s
culpability because (i) the prospects of an agreement being concluded were
uncertain, no documents having been adduced which showed that receipt of
monies was probable (paragraph 124); and (ii) the loss of a proposed agreement,
even if the agreement had been likely, was “no more than the type of event that
businesses have to contend with as part of their daily life” (paragraph 125).

100. As to (i), Mr Rabinowitz referred us to Board Minutes for both the Club and Everton
SDL in January 2022, which indicate that legal work had been done on the naming
agreement, which it seems needed to be signed before third-party senior debt was
obtained; and they were waiting for Mr Moshiri’s instruction. We know that Russia
invaded Ukraine on 24 February 2022 and sanctions were imposed shortly
afterwards. The naming agreement had not been concluded by then. In our view,
on the evidence the Commission was entitled to say – and cannot be criticised for
saying – that “no documents [had] been adduced which showed that receipt of
monies [from this source in FY22] was probable”. The Commission was in the best
position to make this finding on the evidence.

101. But, in any event, as regards (ii), whilst we accept that, in certain circumstances,
the loss of a chance might be a mitigating circumstance, as we have described,
the Commission approached the issue of mitigation correctly, and was entitled to
find (as it did) that the circumstances in respect of the loss of any chance so far as
Mr Usmanov/USM paying £10m in FY22 was concerned, was not such as to tend
to reduce the Club’s culpability in respect of breaching the PSR Rules. In our view,
on the multi-factorial assessment of the evidence which it conducted, the
Commission was entitled to conclude that this did not constitute a mitigating factor.
In particular, we consider that the inherent uncertainties of whether any money
might have come from this source in FY22 to which the Commission referred, were
in themselves capable of reducing any weight of this as a mitigating factor very
substantially and may alone have rendered it insignificant.

102. These uncertainties are compounded here because the existing agreement made
between the Club and USM was not one which would have provided an additional
£10m in the relevant year but for the invasion of Ukraine. There was, at best, only
the chance that a re-negotiated agreement might have done so.

103. Thus, in our view, the argument in mitigation could be put no higher than that, had
that chance (itself filled with other uncertainties) been fulfilled, then there would
have been somewhat less of a breach (but still a significant breach). That is not a
basis for a mitigating factor of any real weight.

104. However, we consider this ground of appeal fails for a shorter reason, emphasised
by the Commission in paragraph 124 of its Decision. Whilst the precise
circumstances of the loss of this chance of sponsorship (i.e. as a result of sanctions
imposed on Russia as a result of its invasion of Ukraine) might not have been
foreseeable, for any PL club, the loss of such chances during the course of a
season is sufficiently foreseeable and a contingent risk against which, if a club acts
with financial prudence as the rules require, the club should properly guard and
steer a financial course that does not result in a breach of the PSR if such chances
do not come to fruition as hoped or even expected.

[Trowel]