Nottingham Forest take action as they face points deduction while Everton risk another penalty

Nottingham Forest take action as they face a potential points deduction while Everton risk another penalty according to reports this week.

The Reds have had to appoint a leading sports lawyer amid a Premier League spending breach risk with Forest insisting that they have “fully complied” with reporting obligations.

The sale of Brennan Johnson is expected to play a major part of the club’s defence in this case of an Financial Fair Play charge.

Nottingham Forest appoint leading sports lawyer to fight Premier League spending breach risk. Forest insist they have “fully complied” with reporting obligations. Brennan Johnson sale will be a major part of the club’s defence #nffc https://t.co/QWSKmGdZHE

— John Percy (@JPercyTelegraph) January 2, 2024

The Times  and The Athletic state that Nottingham Forest could be deducted points if it is deemed the club have breached the Premier League’s FFP rules, but they believe they have worked within the regulations and plan to defend themselves on this front.

The Premier League introduced a new system which deals with charging clubs for breaching rules quicker, imposing points deductions where necessary, something that has already happened to Everton this season.

They received a 10 points deduction with further punishments possible.

Nottingham Forest are deemed by experts to be the next club who could be facing charges over their spending since winning promotion back to the Premier League in 2022, but run the risk of breaching profit and sustainability rules (PSR).

This fast-track system sees clubs having to submit their accounts for 2022/23 by the 31st of December and any breaches are announced by the 14th of January.

Premier League clubs will find out in two weeks if they will face charges for NEW financial breaches with clubs then having two weeks to respond to the charges if imposed, with a hearing to be carried out by the 8th of April at the latest by an independent commission.

Premier League clubs and their legal departments have to conclude their appeals before the end of the 2023/24 campaign, with profit and sustainability rules (PSR) saying that clubs can make a maximum loss of £105million over a rolling three-year period – or £35million a season.

If a club were in the Championship or below within that three-year period, the amount of losses are much lower.

This plays into Nottingham Forest’s favour, having limited to losses of £61million after spending two years in the second tier and one year in the top flight – coming out to £13million per year in the Championship and £35million in the top tier.

Nottingham Forest made losses of around £45.6million for the 2021/22 season after they won promotion and £15.5million the year prior.

But in both of those years, Forest spent twice the amount on wages that was earned in turnover, and while being promoted helped earn them £90million, the crazy signings saw their wage bill go through the through.

In the last two days of the 2023 summer transfer window, Forest made 8 signings, and in the summer before they signed 22 players.

Football finance writer Kieran Maguire told The Times: ‘Nottingham Forest were very much at the limit of their Financial Fair Play allowance when they were promoted to the Premier League and that investment in new players continued in their first season, when they signed players on high wages, including some such as Jesse Lingard who didn’t work out,’

‘If you are looking for clubs close to the limit they would be at the top in my opinion.’

Meanwhile, reports state that Everton could face a second charge in consecutive seasons of breaching profit and sustainability rules (PSR).

They have had an impressive run of form since being handed the 10 point deduction, which they made up in wins.

The fast-track system has been brought in to deal with more straightforward cases of FFP breaches in the Premier League.

And that’s why Manchester City and Chelsea have avoided any kind of punishment so far, who have been alleged to have broken multiple financial rules.

Twitter users reacted with Nottingham Forest having to take action as they face a potential points deduction while Everton risk another penalty…

@nottmtails: Important to note that club believe they have worked within the regulations and plan to defend themselves on this front. Forest were always going to be sailing close to the wind… selling Brennan Johnson was vital. But they believe they are the right side of it.

@Thirdand4ever: TBH, impossible to see how clubs like Forest and Bournemouth aren’t or won’t be in breach , sometime in the next 12-18 months. The whole process is a farce and aimed at one thing and thing only: to protect the Sky6.

@Balh2904: Just relegate Everton, Forest or any other bottom half team that start picking up points, that way the big boys continue to be protected 🤡

@retro_villa: Everton and now Forest, this isn’t what FFP was supposed to be for, it’s being used to punish clubs outside of the SKY 6 cartel for showing any ambition

@eideangm: I’m sure the fans will take it on the chin considering they were right on board with Everton’s punishment when we protested it the other week. 👍

@SarcasticForest: Hi @Everton, just wondering if you know a good printers for some A5 pieces of orange card? Asking for a friend. #NFFC

@loose_tip: Clearly a major issue then if they are that worried to appoint a lawyer, doesn’t sound great 🤦‍♂️

@Mintvilla1: If they are trying to state the Jonno sale was last season, then that’s worrying as it’s clearly this season he was sold. If they are relying on that then they are probably in trouble

@mhart89efc: Everton ‘fully complied’. Made no difference.

@ASeymour1878: Basically you’re not allowed to spend money to try to compete and if you do you’ve got to sell your best players in order to comply. And even then you could still get charged, these dumb rules 🤦‍♂️

@adamjeffrey98: This is genuinely going to happen to every premier league club outside the top 7 in the next few years. Maybe with the exception of Brighton. As we said, you’ve messed up big time @premierleague

@NeilA1878: If this is correct then Forest have already admitted their guilt, and are using the Johnson sale as mitigation, which will obviously be laughed out of the room. Points deduction incoming… hope there isnt one for us as well.

@AnalyticsForest: This doesn’t sound good at all tbh. If we’re trying to make the Brennan Johnson sale part of previous years accounts then I’m not sure we’ll have a leg to stand on. #NFFC

You have to submit accounts by the end of June.

We sold Brennan at the end of August.

Our argument will be we breached FFP in the accounts (June 30th), but rectified that 2 months later by selling Brennan.

You don’t appoint a lawyer if you aren’t concerned. I’m worried #NFFC https://t.co/AZbmacWOKT pic.twitter.com/QWth8zNILm

— Premier League Reds (@NFFC_EPL) January 2, 2024