In a new development, the Premier League has charged both Everton and Nottingham Forest with FFP violations. If guilty, both clubs could face a hefty points deduction. For Everton, it’ll be the second points deduction this season after being deducted 10 points for a previous FFP violation.

Both clubs have two weeks to appeal against the ruling from the Premier League to avoid the consequences of the breaches.

According to the Premier League, both clubs violated the league’s profitability and sustainability regulations. The two clubs vehemently deny violating the profitability and sustainability regulations. The official rules state clubs can lose a maximum of $134 million over three years. That equates to about $44.6 million per year.

The English Premier League wants to ensure the punishments for the violations come down in the same season they happen. In other words, the Premier League is punishing violations immediately instead of putting off sentencing for years down the road.

How did Everton and Forest get into FFP violations?

Currently, Everton is in the appeal process for its previous 10-point deduction. That came after Everton reported $55 million in financial losses in the 2021/22 campaign. Over three years, the Toffees reported losses of $150 million. That is, of course, more than the profitability and sustainability regulations allow.

The added FFP violations focus on developing the club’s new stadium at Bramley-Moore Dock. These new charges come from financial reports for the 2022/23 season. Premier League clubs sent the league office their accounts on Dec. 31, 2023. The construction of the stadium has been a focus for Everton. Yet, its costliness is having severe impacts on Everton’s season.

In the case of Nottingham Forest, the losses over three years largely came after monster spending in the club’s return to the Premier League. After securing its long-awaited return to the Premier League following the 2021/22 campaign, Forest went on a spending spree. The club spent $317 million on new signings in the three transfer windows since promotion. The club has a net loss of spending of $250 million over those two years.

Effects on the league table

Charging these clubs for violating financial fair play does not mean these two suffer from points deductions. After their appeals process, an independent commission will rule on any potential consequences.

The Athletic noted a backstop date for appeals is May 24. The Premier League season concludes on May 19. Therefore, Everton and Nottingham Forest may earn points deductions after they have played their 38 league games. That could drop one or both clubs into the relegation zone, sending them down to the Championship.

As things stand, Nottingham Forest and Everton are firmly in the relegation scrap. Forest is four points ahead of Luton Town after 20 games. Following its 10-point deduction, Everton is a mere one point above Luton. However, Luton Town has a game in hand on Everton.

The rulings against Everton and Nottingham Forest are still casting doubt on the effectiveness of the Premier League in dealing with FFP violations. Most critics point to Manchester City, which is facing 115 financial fair play violations that the Premier League is yet to hand any punishments. A verdict in that more complicated case could take years.