The Independent Football Regulator will have the power to cap clubs’ spending, limit their use of debt, and require them to place money in escrow that can only be released with its blessing, according to its latest proposals.
The measures are part of licensing conditions that clubs will have to meet in order to be able to compete in the top five tiers of English football, and have this week been opened up for a period of consultation.
It comes after the IFR stepped up activity last week with confirmation of the appointment of its first chair, media rights expert David Kogan, and chief executive, former EY partner Richard Monks.
“We are making substantial progress on bringing the Independent Football Regulator regime forward,” said Kogan.
“This latest consultation sets out the new requirements clubs will have to meet on financial regulation, fan consultation and corporate governance. This is a transformational change for football and we will support clubs at every step to reinforce these higher standards.”
The licensing system is a key component of the IFR’s regime and is scheduled to come into effect in the 2027-28 season, with clubs required to make their applications during the preceding campaign. Failure to obtain a license could ultimately result in being prevented from playing.
IFR may tell clubs to keep a buffer account
The IFR consultation makes clear that the watchdog will work with clubs to help them but sets out measures that it would be prepared to take under the Football Governance Act in order to bring those “unable or unwilling to hold appropriate financial resources” into line.
“This may include limiting spending. The IFR would not prescribe how a club should reduce its expenditure; that would remain at the discretion of the club’s management,” it says.
“The IFR could place a limit on the amount of debt a club has, with the aim of reducing debt exposure” and prevent clubs from “using illicit finance”.
The regulator said it might also “require the club to hold a minimum liquidity buffer or keep cash in a separate account accessible only with IFR permission for specific expenses.”
Clubs are likely to be asked to apply for a provisional license in early 2027. Those approved can then have their licence upgraded to a full licence after three years of abiding by its terms.
The proposal adds: “For higher-risk clubs, the IFR may require in-season reporting, providing more frequent updates to monitor their financial situation. Clubs experiencing financial distress can expect real-time engagement with the IFR.”