Editorial – the Premier league and financial regulation

As I write, in the middle of March 2024, the English Premier League is as competitive as it has even been, with three teams (Arsenal, Liverpool, and Manchester City) within a point of each other at the top of the table. At the bottom of the table, Sheffield United and Burnley seemed doomed to relegation, but then four or five clubs are fighting to avoid that final relegation place.

The problem with this scenario is that there lurks behind it the question of the financial regulations that govern the spending (and in particular debts) that English football clubs are allowed. (It may be noted that similar regulations are applied across Europe.)

Everton (currently in 16^th place—out of 20) were docked ten points in November 2023, subsequently reduced to six points on appeal. This was because of the club’s debts, in part due to the building of a new stadium, exceeded limited determined by the Premiership’s existing financial regulations. Everton, along with Manchester City and Nottingham Forest (currently 17th in the table and only three points and goal difference away from the relegation zone), are threatened with further point deductions when additional ongoing investigations are concluded. So, the Premier League title, and relegation issues, may be determined not by skill of the field, or even questionable VAR decisions, but by adjudications on financial irregularities.

The financial regulations—Profit and Sustainability Rules—were introduced in 2013 with the laudable intention of reducing the number of insolvencies that top-tier clubs had been experiencing up to that date. Measured by this criterion, the regulations have been a success. However, questions can still be asked about their appropriateness and fairness. The regulations tend to be somewhat inflexible, and the debt allowed to clubs is not automatically adjusted for inflation. Further, the regulations are thought to favour rich clubs over financially weaker ones, reducing the chances of a poorer club winning or doing well in the Premiership (see ECONOMIST 2024). Alternative regulations are currently being reviewed.

A philosophical investigation into these regulations raises some important issues about the relationship between sport and the law. Crucially, athletes practice within frameworks that are constructed not merely by the rules of their sport, but by the rules and conventions of their club and local competitions, regulations of national and international governing bodies, and ultimately national law (see ABANAZIR 2024). The rules of sport have been used as a proxy to explore the nature of law (see OAKESHOTT 1983). Yet, as Oakeshott argued, rules and laws diverge in their nature, and the financial regulation of the Premiership highlights this.

The outcome of infringing a rule in sport is predictable. There is a set penalty. The adjusting of the points reduction to Everton demonstrates that there is a necessary degree of uncertainty in the penalty accompanying the infringement of financial and legal regulations. While the just outcome of a handball in the penalty area is fairly clear cut, the just outcome of financial infringement will remain contestable, and indeed contested. (Put otherwise, the costs and benefits of infringing financial regulations cannot be calculated with the precision that accompanies a professional foul.)

A question may also be raised over the appropriateness of a punishment. In sport, the punishment for infringing a rule is typically designed to allow the fluent restarting of play, and to inhibit an unfair advantage to the infringing side. While law might aspire to such a clear cut outcome, again, the appropriateness of punishments is contestable. The appropriateness of the points deduction is a case in point. If the illegitimate over-spend could be clearly demonstrated to have led to a better team performance than otherwise, then a points deduction might be appropriate. In Everton’s case, the question would be as to whether their over-spending allowed Everton to avoid relegation in the 2021–22 and 2022–23 seasons. (Several clubs, which were relegated in these seasons, are considering legal action against Everton—to compensate for lost revenue—given that relegation that they suffered should, fairly, have been Everton’s.) If the over-spend did not affect performance, then a points reduction seems arbitrary. Also, it arguably penalises the wrong season, as the illegitimate action occurred in previous seasons.

This leads to a series of question as to whether points deductions are appropriate, and if so, how great a deduction should there be? If inappropriate, what alternative penalties may be applied? Problematically, a fine would seem only to push a club closer to the very insolvency that the regulations are intended to avoid. Perhaps, more profoundly, there is a question as to whether the financial and other regulations have been so formulated as to respect the fundamental meaning and spirit of the sport.

These brief and superficial reflections (by, and here is the confession of personal interest, a long standing Everton supporter) only scratch the surface of a bundle of issues that the philosophy of sport, in alliance with the philosophy of law, could usefully investigate.

At the end of the day, I assume that we all want the Premiership decided on the pitch, not in the law courts. But it is necessary to recognise that modern sport does not happen in isolation from the institutional frameworks of legal and financial regulation. Perhaps, then, to win a league fairly is to win while abiding by both the constitutive rules of the sport, and the plethora of regulations that govern it at an institutional level. But finally, it is important that those regulations are harmonious with the fundamental experience of playing (and watching) the sport.

Disclosure statement

No potential conflict of interest was reported by the author(s).