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Nottingham Forest have been penalized with a four-point deduction for breaching the league’s profit and sustainability regulations.
This has made Forest fall below Luton Town in the relegation zone following the immediate loss of points.
This penalty marks Forest as the second top-flight team to face such consequences, with Everton previously losing 10 points in November, albeit reduced to six on appeal.
Despite the setback, Forest is poised to contest the ruling, as indicated by their likelihood to appeal following a hearing held on March 7 and 8.
Premier League regulations stipulate that clubs can incur losses of up to £105 million over three seasons, equating to £35 million per campaign.
However, due to Forest’s two-year tenure in the Championship during the assessment period, their maximum allowable loss was capped at £61 million.
The league’s protocol mandates that any appeals process must be concluded by no later than May 24, just five days after the conclusion of the current season.
Nottingham Forest and Everton have come under the spotlight of the Premier League for alleged breaches of the league’s profitability and sustainability rules, as confirmed by a statement released in January.
According to the league’s statement, both clubs admitted to the breach. Nottingham Forest, represented by prominent sports lawyer Nick de Marco, centered their defense around the sale of Brennan Johnson to Tottenham Hotspur in September, a transaction valued at over £45m. Forest argued that the sale, though occurring after the accounting deadline, enabled them to secure a higher fee than if they had sold Johnson before June 30.
The financial scrutiny intensified for Nottingham Forest, who made headlines with their promotion in May 2022 by signing a British-record 22 new players in the subsequent summer, reportedly splurging £150m in the process.
Following the charge laid against them two months ago, Nottingham Forest expressed confidence in a prompt and equitable resolution.
Meanwhile, Everton awaits potential sanctions in a separate matter, pertaining to the assessment period ending with their 2022-23 financial accounts.
Notably, Manchester City found themselves in a similar predicament when they were referred to an independent commission in February 2023 after allegations of over 100 rule breaches came to light.
