The government is planning to give independent regulators the power to stop Premier League teams from selling their stadiums.
The Premier League tried to close a loophole in June that allows clubs to use profits from property sales to avoid the profitability and sustainability rule charges. However, the league failed to gain the support of sufficient clubs. At their AGM in summer last year, 11 of the 20 clubs supported the league’s proposal. This was three votes shy of the required two-thirds majority to change the rules.
The EFL prohibits stadium sales to affiliated companies. And the government will give the regulator the power to enforce similar restrictions on the top flight. The football governance bill, which will cover the top five divisions of English men’s soccer, includes proposals that require clubs to get approval from an independent regulator before they can sell their stadium. The Guardian was told by sources familiar with the draft legislation prepared by the Department for Culture, Media and Sport that such requests will only be granted if the club can demonstrate it is in its best interests and has the support of their fans.
The bill will be used by the government to protect community assets such as clubs and their grounds. The bill will also include measures to protect clubs from moving.
Aston Villa, which was then in the Championship league, sold Villa Park four years ago to a company owned by Nassef Sawiris, and Wes Edens. This transaction saved the club from being charged with financial fair play by the EFL. Sheffield Wednesday, Derby, and Reading have also sold their stadiums in recent years to avoid the EFL FFP regulations.
Chelsea sold to a sister firm two hotels located at Stamford Bridge last year for PSR purposes. The government plans will only include stadium sales.
DCMS officials have just finished preparing the latest version of the bill. The previous government introduced the bill to the parliament in April, but it failed to become law before the election. Many Labour MPs want the independent regulator to be able to decide the amount of parachute payment. The new bill will likely include some significant changes. Lisa Nandy is said to be in favour of including these terms and conditions as part of the Whole Game Review that the independent regulator has been tasked to undertake.
The bill gives the regulator the power to force a settlement between Premier League and EFL after their talks have reached a deadlock. The top-flight clubs stopped the discussions about additional funding in March to concentrate on their new financial regulations.
After the arbitral decision on Manchester City’s legal challenge in this month, the Premier League has needed to make further rule changes. This makes the possibility of a new football deal with the EFL even less likely.
DCMS has declined to comment.
Post Disclaimer
The following content has been published by Stockmark.IT. All information utilised in the creation of this communication has been gathered from publicly available sources that we consider reliable. Nevertheless, we cannot guarantee the accuracy or completeness of this communication.
This communication is intended solely for informational purposes and should not be construed as an offer, recommendation, solicitation, inducement, or invitation by or on behalf of the Company or any affiliates to engage in any investment activities. The opinions and views expressed by the authors are their own and do not necessarily reflect those of the Company, its affiliates, or any other third party.
The services and products mentioned in this communication may not be suitable for all recipients, by continuing to read this website and its content you agree to the terms of this disclaimer.