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Appendix 5 - Financial Fair Play Regulations

PART 1 – CHAMPIONSHIP PROFITABILITY AND SUSTAINABILITY RULES

Notes:

Capitalised Terms have the meanings ascribed to them in Regulation 1 or 16 of the Regulations of The League unless otherwise indicated.

The following Rules are supplemental to the Regulations.

1 DEFINITIONS

1.1 Capitalised Terms have the meanings ascribed to them in the Articles of Association and the Regulations of The League unless otherwise indicated below:

 1.1.1  Accounting Reference Period means the period in respect of which Annual Accounts are prepared.

 1.1.2  Acquiring Registration Costs means amounts paid and/or payable for the acquisition of a Relevant Player’s registration, excluding any internal development or other costs. They include:

  (a)  transfer/loan fees and realised conditional transfer amounts, including training compensation and solidarity contributions, paid and/or payable to another Club (or club) and/or third party to acquire the Relevant Player’s registration; and

  (b)  any amount paid and/or payable to any Intermediary or other agent; and

  (c)  other direct costs of acquiring the Relevant Player’s registration e.g. transfer levy.

 1.1.3  Academy Player means for the purpose of this Appendix 5 only, a male player (other than an Amateur Player or a Trialist) who is in an age group between Under 9 to Under 21 and who is registered for and who is coached by or plays football for or at a Club which operates an Academy pursuant to the Youth Development Rules save for any Player who has made 10 or more starting appearances for:

  (a)  any Club in the following competitions:

   (i)  the Championship division of the League Competition;

   (ii)  the Premier League Competition;

   (iii)  any first team club competition organised by UEFA;

   (iv)  any other equivalent professional domestic league to the Championship division of the League Competition or Premier League Competition or first team Cup competition organised by a national association sanctioned by or affiliated to UEFA and/or FIFA (by way of example, Scottish Premiership, Ligue 1, Serie A and La Liga); and/or

  (b)  any other League Competition Match for the Club.

 1.1.4  Adjusted Earnings Before Tax means Earnings Before Tax adjusted to exclude:

  (a)  costs (or estimated costs as the case may be) in respect of the following:

   (i)  depreciation and/or impairment of tangible fixed assets (net of any capital grants);

   (ii)  amortisation or impairment of goodwill and other intangible assets (but excluding amortisation and/or impairment of the costs of players’ registrations);

   (iii)  Women’s Football Expenditure;

   (iv)  Youth Development Expenditure;

   (v)  Community Development Expenditure; and

   (vi)  in respect of Seasons 2019/20, 2020/21 and 2021/22 only, COVID-19 Costs; and

  (b)  with effect from, and including the Accounting Reference Period covering Season 2021/22, profit/loss on disposal of any tangible fixed asset.

 Each of Youth Development Expenditure, Women’s Football Expenditure, and Community Development Expenditure shall only be excluded from the calculation of Adjusted Earnings Before Tax if separately disclosed:

   (i)  by way of notes to the Annual Accounts; or

   (ii)  by way of supplementary information which;

   (iii)  has been identified and calculated in accordance with such guidance as issued by The League;

   (iv)  reconciles to the Annual Accounts; and

   (v)  has been subject to independent audit.

 1.1.5  Annual Accounts means:

  (a)  the accounts which each Club’s directors are required to prepare pursuant to section 394 of the 2006 Act; or

  (b)  if the Club considers it appropriate or The League so requests, the group accounts of the Group of which the Club is a member and which it is required to prepare pursuant to section 399 of the 2006 Act, or which it is required to deliver to the Registrar of Companies pursuant to section 400(2)(e) or section 401(2)(f) of the 2006 Act,

 provided that in either case the accounts are prepared to an accounting reference date (as defined in section 391 of the 2006 Act) which falls between 31 May and 31 July inclusive. If the accounting reference date falls at any other time, separate accounts for the Club or the Group as appropriate must be prepared for a period of twelve months ending on a date between 31 May and 31 July inclusive, and in such a case “Annual Accounts” means those accounts.

 Annual Accounts must be prepared and audited in accordance with all legal and regulatory requirements applicable to accounts prepared pursuant to Section 394 of the 2006 Act and the provisions of Annex 3 (Reporting Requirements in relation to Player registrations).

 1.1.6  Associate means in relation to an individual, any other individual who is:

  (a)  the spouse or civil partner of that individual; or

  (b)  a relative of that individual or of his spouse or civil partner; or

  (c)  the spouse or civil partner of a relative of that individual or of their spouse or civil partner; or

  (d)  a person who that individual is the parent or legal guardian of; or

  (e)  a person who any individual listed at paragraphs (b) and (c) is the parent or legal guardian of; or

  (f)  any other close relative of that person; or

  (g)  anyone else of a close relationship with that person who, in the opinion of The League is or is likely to be acting with or is financially dependent on that person.

 1.1.7  Associated Party means:

  (a)  a Person who has Control of the Club or would be deemed to be interested in the Club in accordance with Regulation 105.2;

  (b)  any Associate of any Person(s) who has Control of the Club or would be deemed to be interested in the Club in accordance with Regulation 105.2; and

  (c)  any Person of which any Person(s) who has Control of the Club or would be deemed to be interested in the Club in accordance Regulation 105.2:

   (i)  is a director; and/or

   (ii)  either directly or indirectly holds shares; and/or

   (iii)  is able to influence the financial, commercial or business affairs or management or administration of that company, and

  (d)  any Person of which any Associate of any Person(s) who has Control of the Club or would be deemed to be interested in the Club:

   (i)  is a director; and/or

   (ii)  either directly or indirectly holds shares; and/or

   (iii)  is able to exercise any influence or control; and

  (e)  any Person which is a Group Undertaking, Parent Undertaking, Subsidiary Undertaking or Associated Undertaking of any Person referred to in paragraphs 1.1.7(c) and 1.1.7(d) above;

  (f)  any Person who is an Associate, shareholder, director, employee or is able to influence the financial, commercial or business affairs or the management or administration of any Person referred to in 1.1.7(c), 1.1.7(d) and 1.1.7(e) and any Associate of any such shareholder, director or employee;

  (g)  any Person who is an employee or partner or Associate of any Person referred to at paragraph 1.1.7(f) of this definition;

  (h)  any Person who has an agreement with any Person listed referred to in paragraphs 1.1.7(a)-(g) in relation to the exercise of their voting power in the Club or the holding or disposal of their interests in the Club;

  (i)  a Person who holds and/or has possession of the beneficial interest in, and/ or the ability to exercise the voting rights applicable to, shares or other securities in the Club (whether directly, indirectly, by means of holding such interests in one or more other person) or by contract or otherwise including without limitation by way of any Concert Party) which confer in aggregate on the holder(s) thereof 5 per cent or more of the total voting rights exercisable at general meetings of the Club;

  (j)  any Person who holds a loan interest or other debt or security interest of any kind in the Club or an entity in the same group of companies as the Club, with the exception of any such interest held:

   (i)  as part of regulated banking services provided by a Financial Institution;

   (ii)  in the form of bonds, notes or other securities held by professional investors; or

   (iii)  pursuant to a debenture providing the holder with access to tickets to events at the Club’s stadium;

  (k)  where a government, public or state funded body has Control of a Club, any Person who that government, public or state funded body also has Control of.

  When considering where a Person is an Associated Party, The League will direct its attention to the substance of the relationship and not merely the legal form.

 1.1.8  Associated Party Transaction means any transaction, whether directly or indirectly, between a Club and an Associated Party. In considering whether a transaction is an Associated Party Transaction, The League will direct its attention to the substance of the transaction and not merely the legal form.

Guidance

If the accounting standards applied by the Club do not require the Club to disclose Associated Party Transactions within the notes to the Annual Accounts, the transactions should be detailed in a separate schedule and submitted to The League.

 1.1.9  Cash Losses means aggregate Adjusted Earnings Before Tax after write back of:

  (a)  COVID-19 Costs; and

  (b)  amortisation and/or impairment of Players’ registrations; and

  (c)  profit or loss on the transfer of Players’ registrations; and

  (d)  inclusion of net cash flow in respect of transfers of Players’ registrations.

Guidance

Covid-19 Costs have the effect of reducing losses for the purposes of ‘Adjusted Earnings Before Tax’ but that relates only to compliance (or otherwise) with P&S Rules. Clubs will still require such losses to be funded by way of a Secure Funding Agreement when losses exceed the Lower Loss Threshold.

This amendment therefore ensures that obligation applies with effect from the current Season. Clubs that wish to add-back Covid-19 Costs for prior Seasons based on the proposed updated definition of Covid-19 Costs may be required to provide evidence of injections of Secured Funding up to and including T, acknowledging the updated Cash Losses definition.

 1.1.10  Community Development Expenditure means:

  (a)  net expenditure by a Club directly attributable to activities (whether in the United Kingdom or abroad) for the public benefit to promote participation in sport and advance social development; and

  (b)  1 .5 .2 donations made by the Club:

   (i)  to United Kingdom charities in a form recognised by such charities; and/or

   (ii)  for foreign charitable purposes in a form which (had the donations been made to registered United Kingdom charities) would have been recognised as charitable.

 1.1.11  COVID-19 Costs means lost revenues and/or exceptional costs incurred by a Club that are directly attributable to the COVID-19 pandemic and that are identified and calculated in accordance with such guidance as issued by The League.

 Claims of COVID-19 Costs of up to:

  (a)  £5,000,000 in Season 2019/20;

  (b)  £5,000,000 in Season 2020/21; and

  (c)  £2,500,000 in Season 2021/22,

  shall be accepted by the League based on Club submissions alone . For any claim for COVID-19 Costs which in aggregate has an impact of more than £7,500,000 on the Club’s P&S Calculation (acknowledging the combination and averaging of Season 2019/20 and Season 2020/21) The League shall assess whether in order to be excluded from the calculation of Adjusted Earnings Before Tax, any part or all of the claim needs to be separately disclosed:

  (d)  by way of notes to the Annual Accounts; or

  (e)  by way of supplementary information which has been identified and calculated in accordance with such guidance as issued by The League and reconciles to the Annual Accounts or agreed upon procedures and which has been subject to independent audit.

Guidance

The express intention of this amendment is to introduce allowances of up to £5m in Seasons 2019/20 and 2020/21 with retrospective and/or retroactive effect in respect of results submitted in those Seasons and for any other reporting periods to which those Seasons relate.

Where a Club has claimed Covid-19 Costs which in aggregate are in excess of the £12.5m limit (averaged out to £7.5m for the purposes of the P&S calculation) The League will require a full breakdown of all Covid-19 Costs for review.

In the scenario where one single addback is material to the £12.5m limit a Club may apply to the EFL for only this element of the addback to be subject to the independent audit, providing that the remainder are otherwise in accordance with the issued COVID-19 Costs guidance and within the relevant amounts above.

Please note for P&S submissions in Season 2023/24, the COVID-19 Costs addback for Seasons 2019/20 and 2020/21 will no longer be relevant. Therefore only the COVID-19 Costs for Season 2021/22 will be included in the P&S Calculation and will be capped at £2.5m.

 1.1.12  Earnings Before Tax means profit or loss before tax, as shown in the Annual Accounts.

 1.1.13  Fair Market Value means the amount for which an asset could be sold, licensed or exchanged, a liability settled, or a service provided, between knowledgeable, willing parties in an arm’s length transaction.

 1.1.14  Group for the purposes of these Rules, has the meaning set out in Section 474(1) of the 2006 Act save that it shall also include any other entity that carries on any material aspect of the football operations of the Club.

 1.1.15  P&S Calculation means, save as indicated below, the aggregation of a Club’s Adjusted Earnings Before Tax for T, T-1 and T-2. In respect of:

  (a)  Season 2020/21 only, the P&S Calculation shall be the aggregation of:

   (i)  the mean of the Adjusted Earnings Before Tax of T and T-1; and

   (ii)  the Adjusted Earnings Before Tax of T-2; and

   (iii)  the Adjusted Earnings Before Tax of T-3,

  (b)  Season 2021/2022 only, the P&S Calculation shall be the aggregation of:

   (i) the Adjusted Earnings Before Tac of T; and

   (ii) the mean of the Adjusted Earnings Before Tax of T-1 and T-2; and (iii) the Adjusted Earnings Before Tax of T-3,

  (c)  Season 2022/23 only, the P&S Calculation shall be the aggregation of:

   (i)  the Adjusted Earnings Before Tax of T; and

   (ii)  the Adjusted Earnings Before Tax of T-1; and

   (iii)  the mean of the Adjusted Earnings Before Tax of T-2 and T-3.

 1.1.16  Player Registration Schedule means a: table (in such a format which shall be agreed by The League with each Club from time to time) which provides such information which is required to be disclosed in accordance with Annex 2 of this Appendix 5.

 1.1.17  Premier League Competition means the annual league competition for Premier League clubs organised by the Premier League.

 1.1.18  Relevant Player means:

  (a)  all Players whose registration is held by the Club at any time during the

period covered by the P&S Calculation (Relevant Period); and

  (b)  all Players in respect of whom some income/expense/profit (or loss) has been recognised at some point in time in the Relevant Period .

 1.1.19  Secure Funding means funds which have been or will be made available to the Club in an amount equal to or in excess of any Cash Losses which the Club has made in respect of the period from T-2 or is forecast to make up to the end of T+2. Secure Funding may not be a loan and shall consist of:

  (a)  contributions that an equity participant has made by way of payments for shares through the Club’s share capital account or share premium reserve account; or

  (b)  an irrevocable commitment by an equity participant to make future payments for shares through the Club’s share capital account or share premium reserve account. This irrevocable commitment shall be evidenced by a legally binding agreement between the Club and the equity participant and may if The League so requires be secured by one of the following:

   (i)  a personal guarantee from the ultimate beneficial owner of the Club, provided that The League is satisfied that

    (1)  he is of sufficient standing; and

    (2)  the terms of the guarantee are satisfactory;

   (ii)  a guarantee from the Club’s Parent Undertaking or another company in the Club’s Group, provided that The League is satisfied that

    (1)  the guaranteeing company is of sufficient standing; and

    (2)  the terms of the guarantee are satisfactory;

   (iii)  a letter of credit from a Financial Institution of sufficient standing and an undertaking from the Club’s directors to The League to call on the letter of credit in default of the payments from the equity participant being made;

   (iv)  payments into an escrow account, to be paid to the Club on terms satisfactory to The League; or

   (v)  such other form of security as The League considers satisfactory; or

  (c) such other form of secure funding as The League considers satisfactory.

 1.1.20  T means the Club’s Accounting Reference Period ending in the year in which assessment pursuant to Rules 2.2 to 2.9 takes place, and:

  (a)  T-1 means the Club’s Accounting Reference Period immediately preceding T;

  (b)  T-2 means the Club’s Accounting Reference Period immediately preceding T-1;

  (c)  T-3 means the Club’s Accounting Reference Period immediately preceding T-2;

  (d)  T+1 means the Club’s Accounting Reference Period immediately following T; and

  (e)  T+2 means the Club’s Accounting Reference Period immediately following T+1.

 1.1.21  Women’s Football Expenditure means expenditure by a Club directly attributable to activities to train, educate and develop players involved in women’s football teams (including, for the avoidance of doubt, such activities as they relate to female players under the age of 18);

 1.1.22  Youth Development Expenditure means expenditure by a Club directly attributable to activities to train, educate and develop Academy Players net of any youth development grant income received by the Club from any of the football governing bodies. Acquisition Registration Costs of an Academy Player cannot be included as Youth Development Expenditure.

 

2 PROFITABILITY AND SUSTAINABILITY

2.1 Each Club shall by 1 March in each Season submit to The League:

 2.1.1  copies of its Annual Accounts for T-1 (and T-2 if these have not previously been submitted to The League) together with copies of the directors’ report(s) and auditor’s report(s) and agreed upon procedures (where relevant), on those accounts;

 2.1.2  a Player Registration Schedule;

 2.1.3  its estimated profit and loss account and balance sheet for T which shall:

  (a)  be prepared in all material respects in a format similar to the Club’s Annual Accounts; and

  (b)  be based on the latest information available to the Club and be, to the best of the Club’s knowledge and belief, an accurate estimate as at the time of preparation of future financial performance; and

  (c)  if Rule 2.5 applies to the Club its P&S Calculation in a form approved by The League from time to time and which as at the date of these Rules is set out in Annex 1; and

 2.1.4  full details of each and any Associated Party Transaction.

Guidance

The League will in due course consider the Annual Accounts for the Accounting Reference Period in respect of which information pursuant to Rule 2.2.2 is submitted and in particular examine whether any material variances indicate that the estimated financial information was not prepared in accordance with Rule 2.2.2(b).

2.2A  In respect of Season 2019/20:

 2.2A.1  the deadline for submission of the information required by Rule 2 .2 shall be 26 August 2020; and

 2.2A.2  there shall be no obligation on each Club to submit the information referred to in Rule 2.2.2(b).

Guidance

The review of Clubs’ P&S Calculations for 2018/19 against actual figures in Clubs’ Annual Accounts (and supporting information) will still be undertaken by the EFL. The adoption of Rule 2.2A.2 does not release any Club from liability relating to any breach of these Rules relating to Season 2018/19 or any prior Seasons. The EFL Board will continue to seek sanctions in line with the existing sanction guidelines.

2.2  The League shall determine whether consideration included in the Club’s Earnings Before Tax arising from an Associated Party Transaction is recorded in the Club’s Annual Accounts at a Fair Market Value. If it is not, The League shall restate it to Fair Market Value.

2.3  The Club will indemnify The League for any associated costs incurred by The League when assessing whether an Associated Party Transaction is recorded at Fair Market Value (including but not limited to costs incurred by instructing a third party to provide a valuation).

Guidance

The League will likely only require an independent fair market valuation where it disagrees with the valuation provided by the Club.

2.4  The League shall not exercise its power set out in Rule 2.3 without first having given the Club reasonable opportunity to make submissions as to:

 2.4.1  whether the said consideration should be restated; and/or

 2.4.2  what constitutes its Fair Market Value.

2.5  If the aggregation of a Club’s Earnings Before Tax for T-1 and T-2 (or in the case of Season 2020/21 T-2 and T-3) results in a loss, any consideration from Associated Party Transactions having been adjusted (if appropriate) pursuant to Rule 2.3, then the Club must submit to the Secretary its P&S Calculation.

2.6  If the P&S Calculation results in a loss of up to the Lower Loss Threshold (calculated in accordance with Rule 3), then The League shall determine whether the Club will, until the end of T+1, be able to fulfil its obligations as set out in 16.19(a), (b) or (c).

2.7  Where The League determines, in its reasonable opinion and having considered any information provided to it by the Club, that the Club may not be able to fulfil its obligations as set out in Regulations 16.19.1, 16.19.2, The League shall have the powers set out in Regulation 16.20.

2.8  If the P&S Calculation results in a loss that exceeds the Lower Loss Threshold, then the following shall apply:

 2.8.1  the Club shall provide, by 31 March in the relevant Season, Future Financial Information to cover the period commencing from its last accounting reference date (as defined in section 391 of the 2006 Act) until the end of T+2 and a calculation of estimated aggregated Adjusted Earnings Before Tax until the end of T+2 based on that Future Financial Information;

 2.8.2  the Club shall provide such evidence of Secure Funding as The League considers sufficient; and

 2.8.3  if the Club is unable to provide evidence of Secure Funding as set out in Rule 2.8.2, The League shall have the powers set out in Regulation 16.20.

2.9  Where The League determines, in its reasonable opinion and having considered the Future Financial Information provided by the Club in accordance with Rule 2.7, that the Club is forecasting to breach the Upper Loss Threshold in T+1 and/or T+2 then The League shall have the powers set out in Regulation 16.20.

Guidance

In the event that a Club, based on the information provided by the Club to The League, is forecasting to exceed the Upper Loss Threshold in T+1 and/or T+2, The League will consider whether it is necessary to require the Club to operate in accordance with the terms of a business plan (to include, by way of example, requirements relating to player acquisitions, disposals, reduction in player costs (i.e. wages) and, where the Club thinks it is achievable, uplifts in revenue) in order to bring the Club back into compliance with Upper Loss Threshold for T+1 and/or T+2.

The League recognises that T+2 is so far in the future it would be difficult for Clubs and The League to accurately forecast for the purpose of P&S and the potential exercise of these powers needs to be considered in that context.

General Approach

The purpose of this Rule is to give Clubs and The League the opportunity to work together to develop the terms of a business plan which will include remedial measures to allow the Club to bring itself back into compliance with these Rules.

The following paragraphs detail The League’s general approach in respect of forecasted breaches in T+1 and/or T+2.

Forecasting Breaches in T+1

Where a Club is forecasting a non-material breach only occurring in T+2, The League’s general approach will usually be to request further information in order to gain comfort that the Club has the necessary plans in place to work towards compliance. The League, generally, in these circumstances will not seek to utilise the more restrictive powers afforded to it unless a change in circumstances deems this necessary. The League will then reassess the Club’s position in T+1 based on the updated results posted as part of the usual March submission process.

If a Club is forecasting a material breach occurring in T+2, The League’s general approach would be to require the Club to provide a significantly more detailed plan than would be the case if the forecasted breach was not material. The League would likely treat such instances in the similar manner it would for a forecasted breach in T+1. Again, The League will then reassess the Club’s position in T+1 based on the updated results posted as part of the usual March submission process.

Clubs will note that this guidance sets out The League’s general approach and that The League will need to determine each set circumstances based on the merits whilst also ensuring that all Clubs are treated consistently. This may lead to The League diverging from its general approach where it is appropriate to do so and nothing in this guidance will affect The League’s right to do so.

2.10  If the P&S Calculation results in a loss that exceeds the Upper Loss Threshold (calculated in accordance with Rule 3) then:

 2.10.1  the Club shall be subject to a Player registration embargo such that The League shall have the right to refuse any application made by that Club to register any Player or any new contract of an existing Player with that Club; and

 2.10.2  the League may exercise its powers set out in Regulation 16.20; and

 2.10.3 the Club shall be treated as being in breach of these Rules and accordingly The League shall refer the breach to the CFRP in accordance with Appendix 6 of the Regulations.

 

3 LOSS THRESHOLDS

3.1  Save for Rule 3A, the Lower Loss Threshold and Upper Loss Threshold for each Club shall be calculated based on the aggregation of the Annual Lower Loss Thresholds and Annual Upper Loss Thresholds set out in the following table, by reference to the league of which the Club was a member in the Season covered by the applicable Accounting Reference Period:

 

Annual Lower Loss Threshold

Annual Upper Loss Threshold

Premier League

Subject to Rule 3.2, £5 million

Subject to Rule 3.2, £35 million

The League

Subject to Rule 3.3, £5 million

Subject to Rule 3.3, £13 million

Guidance

By way of example, a Club that was a member of The League in 2016/17, the Premier League in 2017/18 and The League in 2018/19, will have:

  (a)  a Lower Loss Threshold of £15m; and

  (b)  an Upper Loss Threshold of £61m (using the figures set out in Rule 3.1).

3.2  The Loss Thresholds for any Accounting Reference Periods relating to Seasons when Clubs were members of the Premier League shall be calculated on the basis of the three year aggregated figures set out in Premier League Rules E.57 and E.59 respectively (as amended, extended or replaced from time to time in accordance with the Rules of the Premier League) divided into three equal annual instalments.

3.3  Where there is an adjustment to the Premier League’s Annual Lower Loss Threshold and/or Annual Upper Loss Threshold, as described in Rule 3.2, then The League’s Annual Lower Loss Threshold and/or Annual Upper Loss Threshold for the equivalent period shall be adjusted by a percentage equal to the percentage change applied by the Premier League.

Guidance

By way of example, if for Season 2019/20 the Premier League introduce an Annual Lower Threshold of £6m and an Annual Upper Threshold of £36m then the Thresholds for The League in that Season will be £6m and £13.37m. For ease, threshold figures will be rounded up to the nearest £10,000.

3.4  In respect of Season 2020/21, the Lower Loss Threshold and Upper Loss Threshold for each Club shall be calculated based on the aggregation of the Club’s Annual Lower Loss Threshold and Annual Upper Loss Threshold for T, T-1, T-2 and T-3 as per the figures set out table in Rule 3.1 as amended by dividing those figures by 4 and then multiplied them by 3.

3A LOSS THRESHOLDS – 2020/21, 2021/22 AND 2022/23

3A.1  Subject to Rule 3A.2, in respect of Season 2020/21, 2021/22 and 2022/23, the Lower Loss Threshold and Upper Loss Threshold for each Club shall be calculated based on:

 3A.1.1  in respect of P&S Calculations submitted in Season 2020/21:

  (a)  the Lower Loss Threshold shall be £15,000,000; and

  (b)  the Upper Loss Threshold shall be calculated by reference to the aggregate of:

   (i) the mean of the Annual Upper Loss Thresholds applicable to T and T-1;

   (ii)  the Annual Upper Loss Threshold of T-2; and

   (iii)  the Annual Upper Loss Threshold of T-3,

 3A.1.2  in respect of P&S Calculations submitted in Season 2021/22:

  (a)  the Lower Loss Threshold shall be £15,000,000; and

  (b)  the Upper Loss Threshold shall be calculated by reference to the aggregate of:

   (i)  the Annual Upper Loss Threshold applicable to T;

   (ii)  the mean of the Annual Upper Loss Thresholds applicable to T-1 and T-2; and

   (iii)  the Annual Upper Loss Threshold of T-3,

 3A.1.3  in respect of P&S Calculations submitted in Season 2022/23:

  (a)  the Lower Loss Threshold shall be £15,000,000; and

  (b)  the Upper Loss Threshold shall be calculated by reference to the aggregate of:

   (i)  the Annual Upper Loss Threshold applicable to T;

   (ii)  the Annual Upper Loss Threshold of T-1; and

   (iii)  the mean of the Annual Upper Loss Threshold applicable to T-2 and T-3.

3A.2 Clubs may instead elect to calculate the Annual Upper Loss Threshold and Annual Lower Loss Threshold based on the aggregation of the Club’s Annual Lower Loss Threshold and Annual Upper Loss Threshold for T, T-1, T-2 and T-3 as per the figures set out table in Rule 3.1 as amended by dividing those figures by 4 and then multiplied them by 3.

 

4 DUTY OF DISCLOSURE

4.1  The League may require a Club to provide such further information as The League deems necessary (acting reasonably) for the purposes of enabling The League to assess whether a Club has met (as applicable) the Profitability and Sustainability Rules or not. By way of example, and without limitation, additional information may be requested where:

 4.1.1  any submission is incomplete;

 4.1.2  there are insufficient assumptions; or

 4.1.3  additional evidence is required to support certain assumptions.

4.2  Any such request shall be made in writing (including by email to the Finance Director or equivalent) and shall be responded to in full within 5 Normal Working Days of any such request being made.

4.3  Without prejudice to the right of The League to refer any breach of rules to the Disciplinary Commission in accordance with section 8 of the Regulations, where any Club is in breach of any requirement of these Rules relating to the provision of information, The League may refuse any application by that Club to register any Player or any new contract of an existing Player of that Club.

4.4  Each Club shall, at all times and in all matters within the scope of these Rules, behave with the utmost good faith both towards The League and the other Clubs (provided always that only The League shall have the right to bring any action whatsoever for any alleged breach of this requirement). Without prejudice to the generality of the foregoing, Clubs shall not manage their affairs or submit information which is intended to seek to or take any unfair advantage in relation to the assessment of fulfilment (or non-fulfilment) of the requirements of the Rules.

 

5 CLUBS CEASING TO BE MEMBERS OF THE CHAMPIONSHIP

5.1  If a Club is promoted or relegated out of the Championship Division that Club shall, notwithstanding promotion or relegation, remain bound by these as if it were still a Championship Club, until such time as it has complied with all of its obligations relating to its last Season as a Championship Club.

 

6 REVIEW APPLICATIONS

6.1  Where in these Rules there is any reference to The League making a determination, including by way of example and without limitation:

 6.1.1  assessment of Secured Funding; and

 6.1.2  determinations by The League in accordance with Rule 2,

the Club shall subject to the provisions of Rules 6.2 and 6.3, have a right to have such decision reviewed by the CFRP in accordance with Appendix 6 of the Regulations (a Review Application).

 

7 CONFIDENTIALITY

7.1  Information provided by a Club to the CFRU in accordance with these Rules shall only be made available to such members of The League as are required to know such information in order to fulfil their duties to The League (and who are bound by obligations of confidentiality as part of their contract of employment).

7.2  Notwithstanding the provisions of Rule 8.1, the CFRU is expressly permitted to make available to the Premier League any and all information received by the League in relation to any Club that becomes a Promoted Club to enable the Premier League to exercise its rights under Regulation 86.4 and 86.5. This Rule will take precedence over any purported attempt by a Club to disclose information to the League on a private or confidential basis.

 

8 IMPLEMENTATION AND TRANSITION

8.1  For the purposes of Rule 2, the first ‘T’ Season will be 2016/17, and as a consequence these Rules are effective (in so far as they relate to T-1 and T-2) for the 2014/15 and 2015/16 Seasons.

8.2 If:

 8.2.1  a Club’s Adjusted Earnings Before Tax resulted in losses of £13 million (or greater) in Season 2014/15 and/or Season 2015/16; and

 8.2.2  that Club was sanctioned in accordance with the Championship FFP Rules in respect of the applicable Season,

 then, but not otherwise, the Adjusted Earnings Before Tax loss for that Club for that Season (for the purposes of these Rules) will be capped at £13m.

8.3  The Championship FFP Rules remain in force for Seasons 2014/15 and 2015/16.