British media footballtransfers reported that the Premier League voted to adopt a series of new rules, promising to completely change the Financial Fair Play Policy (FFP) of England's top league.
From the 2026/27 season, Premier League teams will need to comply with new squad cost ratio (SCR) and sustainability and system resilience (SSR) rules, but proposals for "top-to-bottom anchoring" (TBA) were rejected. According to Mike Keegan of the Daily Mail, the club approved the new proposals by a vote of 12 to 7.
So why are these new rules introduced and what do they mean?
The Premier League has approved new Financial Fair Play rules for the 2026/27 season, introducing the Squadron Cost Ratio (SCR) and Sustainability and System Resilience (SSR) systems. The SCR aligns Premier League spending limits with UEFA rules, capping spending at 70% of revenue for European clubs and 85% for non-European clubs to help maintain competitiveness.
The SSR introduces new financial health tests to ensure clubs remain stable over the short, medium and long term. Proposed penalties include a six-point deduction for repeat offenders and further penalties for every £6.5m spent above the limit.
A proposal for a tougher spending cap called "Top to Bottom Anchoring" (TBA) has been rejected amid opposition from major clubs and the Professional Footballers' Association (PFA).
Why do Premier League clubs want to introduce new FFP rules?
Premier League chief executive Richard Masters told Sky Sports that some clubs were concerned they would have to balance FFP across two different systems. While the Premier League has its own rules, UEFA has a different set of rules in European competitions. The goal is to find better consistency between the two.
He explained: "We have probably been working with internal working groups and clubs for about a year on developing a new system. The main starting point was to align with UEFA, so our current PSR rules were broadly aligned with UEFA's FFP rules when they were introduced."
"We followed that and introduced those rules, Make them the same. So those clubs that operate in a dual system don't need a completely different system when entering and exiting European competitions. This way there is continuity in financial planning, which is the main driver for us to look at what are called lineup cost ratios, which are already implemented in Europe."
What does the Premier League's lineup cost ratio mean for clubs?
Since 2023, UEFA has implemented a squad cost ratio (SCR), which limits how much clubs can spend as a percentage of their income. According to UEFA regulations, clubs can spend 70% of their income on the team, including transfer fees and wages. The Premier League now agrees that its clubs participating in European competitions will follow this rule, but clubs not participating in continental competitions can spend 85% of their income on their teams. In addition, there is a multi-year 30% additional spending limit that, once exhausted, will result in sports sanctions if the 85% standard is not met.
Why do non-European clubs have the opportunity to spend more money?
Simply put, because they miss out on the lucrative revenue that comes from participating in profitable events like the Champions League, it is seen as a way to balance competitiveness.
The Premier League stated: "The new SCR rules are designed to promote all clubs to pursue greater opportunities for success and bring the league's financial system close to UEFA's existing SCR rules, which has a threshold of 70%."
The Premier League has launched new financial rules to ensure the financial health and sustainable development of clubs. Key features of the new system include transparent in-season monitoring and sanctions, protection against competitive underperformance, the ability to allow spending to exceed revenue, enhanced off-field investment capabilities and the reduction of complexity by focusing on football costs. An advantage of this system is that clubs are no longer evaluated based on past performance, but instead are provided with a clear budget for each season, which is revised annually.
What are sustainability and system resilience?
New sustainability and systemic resilience rules are designed to ensure clubs’ long-term financial health. These rules exist to prevent clubs from getting into trouble due to overspending.
The Premier League said: "The Sustainability and Systemic Resilience Rules assess a club's short-, medium- and long-term financial health through three tests - the working capital test, the liquidity test and the positive assets test."
Clubs that repeatedly breach Financial Fair Play rules will be assessed a penalty of six points. According to BBC Sport, a further point will be deducted for every expenditure exceeding £6.5 million. It's important to note that this has not yet been confirmed.
Why was the Alliance-wide Anchor (TBA) proposal rejected?
The TBA is undoubtedly one of the most controversial proposals, and given its high-profile opposition, its rejection is not surprising. The proposal proposes running in parallel with the SCR, with further restrictions on spending based on the central income of the league's lowest-earning team. Central revenue is independent of other revenue streams, including prize money and TV rights, which are allocated annually by the Premier League. The proposal suggests setting that limit at about five times the revenue of the league's lowest-earning team and serving as a final spending cap.
However, it was opposed by some owners, such as Manchester United's Sir Ratcliffe, and the Professional Footballers' Association (PFA).
Ratcliffe said: "The TBA will inhibit the development of the top clubs in the Premier League. The last thing you want to see is that the top clubs in the Premier League cannot compete with Real Madrid, Barcelona, Bayern Munich and Paris Saint-Germain - this is ridiculous."
The PFA has expressed concerns about the TBA model, believing that it will limit players' wages.. PFA CEO Maheta Molango said: "We have a tendency to think that football is above the law, but football is not above the law and the unfortunate reality is that you cannot artificially limit someone's ability to make a living. There are ways to agree on financial sustainability, but this cannot be imposed unilaterally."
The Premier League responded through a statement : "We disagree with the PFA's views on the proposed financial rules and its extensive consultation process. The PFA has had numerous opportunities since March 2024 to provide feedback and participate in developing the proposals... We have carefully considered feedback as we received it, including from the PFA, and, where appropriate, have incorporated it into the draft rules."