Most of the clubs in the Premier League have voted in favour of the clubs having a spending cap whenever a transfer window opens.
The clubs voted in favour of the proposal on Monday, April 29, 2024, ahead of the 2025/26 football season. Sixteen clubs voted in favour of the proposals for the Premier League to complete the final economic and legal analysis needed to create a spending-cap model. The new model might be presented to clubs at the June 2024 annual general meeting (AGM).
What is the implication of the Spending cap in the Premier League?
If the Premier League decides to adopt this new proposal, that means it would replace the current Profit and Sustainability Rules (PSR) from the 2025-26 season onwards.
What are the current rules?
The Premier League’s Profit and Sustainability Rules permit clubs to lose £105m over a three-season period. The Premier League states that the current regulations are designed to try to ensure the long-term financial sustainability of clubs and maintain the competitive nature of the league by preventing “unfair advantages”.
Which clubs voted against the Spending cap?
16 clubs voted in favour of the new rule whilw Manchester City, Manchester United, and Aston Villa opposed the possible introduction of a spending cap but Chelsea abstained from voting
However, the body governing football in Europe, UEFA also has its own rules when it comes to spending on players every transfer window.
What is Uefa’s Financial Fair Play model?
When the idea of moving away from the Profit and Sustainability Rules was first discussed, it had been anticipated that Premier League clubs would move towards a model adopted by Uefa.
Under Uefa rules, clubs can spend no more than 90% of their revenue on squad costs. This will reduce to 70% from the 2025-26 season. This means the amount they can splash out is limited by the amount of cash they generate.
