On Friday, Premier League clubs voted to revamp the division’s financial regulations starting next season, but they declined to implement the controversial “anchoring” proposal.
The existing Profitability and Sustainability Rules (PSR) will be replaced by the new Squad-Cost Rules (SCR), which will restrict clubs to spending a maximum of 85% of their football revenue, as well as their net profit or loss from player transfers.
According to a statement from the Premier League, “a multi-year allowance of an extra 30% will incur a levy, and once this allowance is used up, clubs must adhere to the 85% cap or face sporting penalties.”
The transition to SCR aligns the Premier League more closely with UEFA regulations, which currently allow clubs in its competitions to spend a maximum of 70% of their revenue on football-related costs.
Club representatives also endorsed new Sustainability and Systematic Resilience (SSR) proposals, which the Premier League described as a framework for evaluating a club’s financial health in the short, medium, and long term, using three metrics: Working Capital Test, Liquidity Test, and Positive Equity Test.
Sources indicated to ESPN that the SSR proposal passed unanimously, but only seven clubs supported the ‘top-to-bottom anchoring’ (TBA) plan, which would have capped any club’s spending to no more than five times the revenue earned by the league’s lowest-placed team from centralized payments—such as prize money, television rights, and shared commercial earnings.
“The new SCR rules aim to create opportunities for all clubs to pursue greater success and align the league’s financial framework with UEFA’s existing SCR guidelines, which set a threshold at 70%,” the Premier League stated.
Other significant aspects of the league’s new system include real-time monitoring and clear sanctions, safeguards against competitive imbalances, the capability to invest in future revenues, enhanced off-pitch investment potential, and a simplified framework focused on football-related costs.
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The vote concludes a two-year consultation process, which included testing both SCR and TBA as part of preliminary assessments to assist clubs in understanding compliance with potential changes. SCR supersedes PSR, which previously allowed a maximum loss of £105 million ($137.2 million) over a rolling three-year span.
The decision to forgo anchoring has garnered attention, as proponents believed it would enhance competitive equity in the league. Nonetheless, the Professional Footballers Association cautioned that spending limits could negatively impact player wages, and there were concerns that elite English clubs might struggle to compete for top talent in the transfer market if a strict spending ceiling were enforced.
Three major sports agencies—CAA Stellar, CAA Base, and Wasserman—had threatened legal action, arguing that introducing TBA might violate section two of the UK’s Competition Act. By linking spending limits to revenue rather than a fixed amount tied to centralized contracts, clubs retain greater flexibility.