Everton docked two more points for second breach of financial rules

Everton were docked two more points by the Premier League on Monday -- their second points deduction this season -- after an independent commission found they had breached the league's Profitability and Sustainability Rules (PSR).

The deduction, announced in a Premier League statement, means Everton dropped to 16th place with 27 points, two above the relegation zone.

Everton said they would appeal against the points deduction, meaning the outcome of the relegation battle could go beyond the last day of the season on May 19.

"The independent commission heard evidence and arguments from the club on a range of potential mitigating factors for its admitted breach of 16.6 million pounds ($21 million), including the impact of its two successive PSR charges," the Premier League said.

"The commission determined the appropriate sanction to be a two-point deduction, taking effect immediately."

Everton admitted to a breach of PSR for the assessment period ending with the 2021-22 season, having incurred 124.5 million pounds in losses in that period. The club were subsequently deducted 10 points in November for that breach, although that was reduced to six on appeal in February.

The club was charged again in January for violations of the Premier League's PSR in their financial records for a period beginning in 2019-20 and ending in 2022-23.

While the Merseyside club did not dispute the Premier League's approach to a second sanction, they argued mitigating circumstances including double jeopardy, the loss of a sponsorship deal with Russia company USM and that they had promptly admitted their guilt.

"While the club's position has been that no further sanction was appropriate, the club is pleased to see that the commission has given credit to the majority of the issues raised by the club," Everton said.

"Everton remains committed to working collaboratively with the League on all matters relating to PSR but is extremely concerned by the inconsistency of different commissions in respect of points deductions applied.

"The club and its legal representatives have begun the preparations to appeal the commission's decision."

MITIGATING ARGUMENTS

According to Premier League guidelines, clubs are at risk of breaching PSR if they incur more than 105 million pounds ($132.62 million) in losses over three seasons, or 35 million pounds annually.

The club previously admitted to a breach of PSR for the assessment period ending with the 2021-22 season, having incurred 124.5 million pounds in losses in that period, according to the independent commission.

In a statement in January, Everton pointed out that the first charge, for which they had already been sanctioned, covered 75% of the time period of their second breach.

In its written reasoning the independent commission agreed with the Premier League that a five-point deduction was suitable, but reduced it to two after agreeing Everton's arguments for mitigation.

Everton's Fan Advisory Board had also asked the panel to "consider the implications of a further points deduction on supporters, Everton's staff, the local community, and the broader football family".

However, this was rejected.

"As a matter of principle, it would be wrong for the views of Everton FAB to impact the appropriate sanction, particularly in circumstances where the supporters of other clubs would undoubtedly have other views they would ask us to consider," the panel found.

While Everton were the first club to be docked points for breaching PSRs, Nottingham Forest were plunged into the relegation zone earlier this month after having four points deducted for breaking financial rules last season.

Forest are 17th with 25 points, having played one game more than Everton, and are ahead of Luton Town in 18th place on goal difference. Forest are also appealing against their sanction and with Everton set to do the same, clubs in the relegation zone face not knowing how many points they need to stay up.

The Premier League has announced a backstop date of May 25 for all appeals to be concluded.

Last year, treble winners Manchester City were referred to an independent commission over more than 100 alleged breaches of finance rules, but no verdict has been reached in that case. City have denied any wrongdoing.