Nottingham Forest are given a FOUR POINT deduction for breaching Premier League financial rules, leaving them in the relegation zone with nine games remaining

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Nottingham Forest have been hit with a four-point deduction after breaching the Premier League’s winning and sustainability rules.

The penalty sees Forest drop into the relegation zone as they now sit 18th in the Premier League with 21 points, one point behind Luton in 17th. An appeal will likely follow.

The Premier League has claimed that the club exceeded the PSR threshold by as much as £34.5 million in the relevant period.

Forest were accused of breaching spending rules in January 2024, along with fellow Premier League side Everton, with the Toffees receiving a 10-point deduction earlier this season.

That penalty was later reduced to six points, but Forest have now suffered a similar fate at a crucial point in the campaign.

Nottingham Forest have been hit with a points deduction for breaching Premier League spending rules

Forest move into the relegation zone after being awarded the penalty, falling behind Luton Town

Forest now find themselves in the relegation zone below Luton after deducting four points

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Forest published a statement on Monday outlining that they were ‘disappointed’ with the decision to hand out a points penalty, although they did say it was for the integrity of the competition to hand out the penalty ‘in the same season in which they are imposed. ‘.

Forest’s four-point penalty

Forest received a lower sanction than Everton, partly due to the fact that they admitted their guilt from the start and adopted a joined-up approach to the Premier League. By contrast, Everton denied breaking spending rules for a long period after they were charged.

Forest are likely to appeal, which the Premier League has promised to hear by April 15. The verdict would follow a month later. The Premier League has imposed itself a ‘backstop’ date of May 24 to conclude all PSR cases and any appeals. This is five days after the last day of the season, but the Premier League expects to have things resolved before then.

The Premier League has made it clear throughout this process that they do not have a set sanctions policy and do not recommend a set points deduction. Each individual case is considered and heard on its merits by a separate, independent committee, and they have no current plans to change this. The independent committee that heard Everton’s appeal last month ruled that a six-point deduction was “necessary and sufficient” to enforce the PSR rules, but did not recommend its introduction as a minimum rate.

By Matt Hughes

It added: ‘We were extremely appalled by the tone and content of the Premier League’s submissions to the Commission.

‘After months of involvement in the Premier League and exceptional cooperation throughout, this was unexpected and has damaged the confidence we had in the Premier League.

‘For the Premier League to require an eight-point sanction as a starting point was completely disproportionate compared to the nine points prescribed by their own rules for insolvency.

‘We were also surprised that the Premier League did not take into account the club’s unique circumstances and their mitigation at all. In circumstances where this approach is adopted by future PSR committees, it would make it extremely difficult, if not impossible, for newly promoted clubs without parachute payments to compete, undermining the integrity and competitiveness of the Premier League.”

The statement also referred to a deal to sell Brennan Johnson to Tottenham, which would be a key part of their defense for breaching spending rules in the relevant period.

Because FFP calculations are made over a three-year period ending June 30, the Johnson deal will count towards the 2021-24 settlement rather than 2020-23 as it was completed on deadline day.

Clubs are allowed to incur financial losses of £105 million over three years, with Forest reporting an annual loss of £45.6 million in their latest accounts.

Another complication comes from Forest being a Premier League team for only one of those three seasons; Championship clubs have losses of up to £13m per season, meaning their cap was effectively £61m.

Forest say they could have sold Johnson to Brentford in June for around £30m, which would have put them in a healthier financial position for the 2020-2023 period, but almost £20m out of pocket in total.

Nuno Espirito Santo’s side now face an uphill battle to stay in the Premier League for another year

This deduction puts Forest at greater risk of relegation if they end up in the bottom three

For the club’s sustainability, they claim that accepting almost £50 million for Johnson in August was better than £30 million earlier in the summer.

The statement continued: ‘Even after missing the PSR reporting deadline, the Club still took steps to ensure that Brennan Johnson was sold before the end of the transfer window. That was a clear demonstration of our respect and support for PSR.

‘The Commission’s decision raises questions that are important for all aspiring clubs. The player transfer market is a highly specialized trading environment that cannot be compared to the sale of normal products and services.

‘There will be cases where a player transfer cannot be completed in the first half of a transfer window and only at the end of that period. This should not be a reason for condemning a club. That this is not recognized by the Commission or the Premier League should be a matter of great concern to all fans of our national football.

‘Of wider concern to all aspiring clubs is the worrying effect this decision will have on the operation of the player trading model. This is the only model that allows clubs outside the small group at the top of the Premier League to realistically move up the football pyramid.”

Forest’s response to the punishment concluded with the insinuation that ‘the high level of cooperation’ they had shown throughout the process had not been ‘reciprocated’ by the league.

Prior to the announcement, Forest were just three points ahead of Luton in 18th, with the Hatters earning a late 1-1 draw with Nuno Espirito Santo’s side on Saturday to stay within striking distance, although they now move Forest to 17th took place. .

A hearing took place to decide what punishment the club faced on Thursday and Friday last week, ahead of Saturday’s match.

Nuno Espirito Santo’s side now sit in 17th place, but the boss claims his side will continue to fight against relegation

Forest’s spending since returning to the English top flight in early 2022-23 has been extremely lavish.

From that summer onwards, no less 42 players have come to the City Ground for more than £250 million.

Asked about the upcoming ruling after Saturday’s clash with Luton, Espirito Santo said the club would ‘keep going and fighting’ in a bid to overcome defeat.

The indictment against Manchester City in February for 115 alleged infringements is an ongoing case.

FOREST’S FULL STATEMENT

Nottingham Forest are extremely disappointed with the Commission’s decision to impose a four-point sanction on the Club, which will be applied with immediate effect.

Despite our disappointment, we thank the Commission for its willingness to deal with this matter on an accelerated basis. The Club considers it essential to the integrity of the competition that the charge be resolved in the season in which the charge is filed.

We were extremely disturbed by the tone and content of the Premier League’s comments to the Commission.

After months of involvement in the Premier League and exceptional cooperation throughout, this was unexpected and has damaged the confidence we had in the Premier League.

The fact that the Premier League required an eight-point sanction as a starting point was completely disproportionate compared to the nine points prescribed by their own rules for insolvency.

We were also surprised that the Premier League did not take into account the club’s unique circumstances and mitigation at all. In circumstances where this approach is adopted by future PSR committees, it would make it extremely difficult, if not impossible, for newly promoted clubs without parachute payments to compete, undermining the integrity and competitiveness of the Premier League.

While the Premier League may have questioned the Club’s business plan, the Club continues to maintain that it has responsibly balanced PSR compliance with significant investment in the squad to ensure that for the first time in over twenty years we to compete in the competition.

Even after the Club missed the PSR reporting deadline, it still took steps to ensure Brennan Johnson was sold before the end of the transfer window. That was a clear demonstration of our respect and support for PSR.

The Commission’s decision raises questions that are important for all aspiring clubs. The player transfer market is a highly specialized trading environment that cannot be compared to the sale of normal products and services.

It may happen that a player transfer cannot be completed in the first half of a transfer period and only at the end of that period. This should not be a reason for condemning a club. That this is not recognized by the Commission or the Premier League should be a matter of great concern to all fans of our national football.

Of wider concern to all aspiring clubs is the worrying effect this decision will have on the operation of the player trading model. This is the only model that allows clubs outside the small group at the top of the Premier League to realistically move up the football pyramid.

The Commission’s rationale is that clubs should only invest after they have made a profit on their player development. This reasoning destroys mobility in the football pyramid and the effect of the decision will be to drastically reduce the room for maneuver for all such clubs, leading to stagnation of our national game.

We believe that the high level of cooperation shown by the Club throughout this process, which is confirmed and recorded in the Commission’s decision, was not reciprocated by the Premier League.