An independent panel has handed Everton a two-point deduction on Monday for breaching the Premier League’s profit and sustainability rules (PSR), the second time the club has faced a points deduction this season.
Premier League regulations stipulate that a club can lose no more than £105 million ($132.54m) over a three-year period.
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“Over a three-day hearing last month, the independent Commission heard evidence and arguments from the club in respect of a range of potential mitigating factors for its admitted breach of £16.6 million, including the impact of its two successive PSR charges,” the Premier League said in a statement.
“Having done so, the Commission determined the appropriate sanction to be a two-point deduction, taking effect immediately.”
The points deduction means Everton have dropped one place in the Premier League table to 16th, two points above the relegation zone.
The Premier League added that there remains a dispute over accounting of Everton’s new stadium — the league argues that stadium funds should be recorded as losses with regards to PSR, while Everton argues to the contrary. The league said that Everton could yet face an additional penalty and that it will be resolved “at a later date,” although it is unlikely to be concluded this season.
Everton announced in a statement that they plan to appeal the decision and have begun preparations to do so, adding that the club is “extremely concerned by the inconsistency of different commissions in respect of points deductions applied.”
In the published report, the independent commission states that the starting point of the deduction was five points, with all breaches garnering a three-point sanction plus an extra two for losing £16.6 million above the league’s upper loss threshold.
The eventual decision was a two-point penalty as a result of some of the mitigating factors presented by Everton during the hearing. Those included the fact that Everton have already been punished for some of the years in question, the loss of sponsorship money relating to Russia’s invasion of Ukraine, and Everton’s early admission of breaching the PSRs.
The committee added that it rejected a number of other mitigating factors, including the construction of Everton’s new stadium, as they “generally reflect the ordinary vicissitudes of a professional football club.” It also said that the club’s level of cooperation “was not exceptional.”
Everton have already faced a points deduction this season for a previous PSR breach. The club were initially docked 10 points in November by an independent commission before having the penalty reduced to six points on appeal.
The Merseyside club were charged with a second breach in January alongside fellow relegation battlers Nottingham Forest, who were deducted four points in March as punishment.
The independent commission’s report said Forest’s charge warranted a six-point penalty but was reduced to four points after mitigation, which included an early plea and meaningful cooperation with the investigation.
After their promotion at the end of the 2021-22 season, Forest broke the record for most transfers by a Premier League club in the summer window, completing 21 separate deals.
Manchester City were also referred to an independent commission over more than 100 alleged breaches of finance rules since the club were acquired by the Abu Dhabi-based City Football Group.
Premier League chief executive Richard Masters previously confirmed that a date has been set for a hearing on City’s case but declined to reveal what the date is.