ReRegulate

REREGULATE: THE CHANGING LANDSCAPE OF REGULATIONS IN FOOTBALL

The Independent Football Regulator — A Turning Point in UK Football Governance

“The most contentious part of the Fan-Led Review is the proposed implementation of an independent regulator. We’ve already touched on how many regulators football has. It has a load of them. The FA is a quasi-regulator. The EFL is a quasi-regulator. The Premier League is too. UEFA is, FIFA is. They are all regulators in effect. What would an independent regulator do? It’s only going to be as good as the people who are on it, right? It’s going to need experts, lawyers, accountants, and politicians who all know the game, and can effectively regulate it. I have concerns about that. It needs to be properly independent from the FA, as well. If it does get implemented…then the area that I would want it to focus on, is an owners and directors test.”

       (Excerpt from an interview in 2022 with a sports law expert following the Fan-Led Review.)

To address the problem of an inadequate regulatory framework, the Fan-Led Review recommended that the UK Government establish a new and Independent Regulator for English Football (IFR). The implementation of an independent regulator is not a new concept and has been adopted in other industries such as finance and communications (Maguire, 2022). However, as regulators in these industries have had mixed success in addressing their respective challenges, Maguire (2022) notes that an IFR in professional football should not be expected to fully resolve the complex issues facing the sport. The Fan-Led Review recommendations have been developed into the Football Governance Bill, which is currently going through Parliament. Following the third reading of the Bill in the House of Lords, it is now in the House of Commons for a vote before being granted Royal Assent and enacted as law. If passed by the House of Commons, it is probable that the IFR will be established and operational by the start of the 2025/2026 football season.

In offering a holistic solution, the IFR would address national football matters requiring comprehensive regulatory oversight, rather than the current system where problems are addressed in isolation on a league-by-league or issue-by-issue basis (DCMS, 2021, p. 41). The intention is for such a regulator to provide invaluable oversight and adaptability in dealing with problems in football. These powers include the regulation of finance, corporate governance, ownership, club heritage, fan engagement, and backstop powers over revenue distribution.

The IFR will operate with a chair and board comprising individuals with diverse expertise from various sectors. Board members will be appointed by a separate group of experts independent of the government, with the FA holding observer status. To promote transparency, the Fan-Led Review recommended that the IFR publish an annual report detailing its operational and financial activities for the previous year. The IFR will be held accountable by the UK Government via the DCMS Select Committee. On 25th April 2025, David Kogan OBE was selected as the preferred candidate for IFR Chair and must now face Parliament before being officially appointed.

To ensure a smooth transition, an interim shadow body—the Shadow Football Regulator—has been established. This body is working closely with the relevant football authorities to oversee financial regulations and facilitate a seamless implementation of the proposed model (DCMS, 2021). While the Bill progresses through Parliament, the shadow regulator is engaging stakeholders on the IFR’s implementation, building the governance structure, and working on the State of the Game report (DCMS, 2025).

The Objectives of the Independent Football Regulator.

The IFR will have its powers and objectives established by statute, operating outside political and governmental interference.  The clear statutory objectives will set out the purpose of the IFR and dictate the board’s aims and objectives. The primary aim is to tackle identified problems, with an initial focus on financial sustainability within the sport (DCMS, 2021). The IFR will have three primary objectives:

  • Club Financial Soundness: To protect and promote financial sustainability of clubs, ensuring that clubs take sensible financial decisions and take the long term view into consideration.
  • Systemic financial resilience– To foster financial resilience throughout English football as a whole. The IFR will ensure systemic risks and structural issues like the management of the distribution of revenue through the pyramid.
  • Heritage– To implement safeguarding measures that ensure traditional features of English football that matter most to the fans and local communities of clubs are protected. (DCMS, 2025).

The IFR will also have secondary objectives of promoting sporting competition, overseeing the competitiveness of the clubs it regulates, and fostering the investment and growth of English football. It is expected that the IFR will charge a levy on licensed clubs in order to fund its running cost and it will determine how the levy is distributed amongst clubs. It is unlikely that this levy will be divided equally amongst clubs, with Premier League clubs are expected to contribute a larger proportion.

A Licensing System

The IFR will regulate through a licensing system, requiring clubs to have a licence in order to operate. This would give the IFR the power and flexibility to enforce its requirements on these regulated clubs and address governance issues effectively. All clubs in the top five tiers of Men’s football in England will fall within the scope of the IFR and will be subject to the IFR powers relating to  “financial regulation, fan engagement, and protection of club heritage, as well as improving governance standards by publishing a football club corporate governance code for clubs to report against.” (DCMS, 2025)

The licence system will replace other inferior models such as standalone codes of conduct that are prescribed by statute and obligatory regulations as they tend to be “a one size fits all approach and are highly prescriptive” (DCMS 2021, p. 45). In contrast, the proposed licencing conditions will be more flexible and have been drafted to assign simpler obligations to the smaller clubs to facilitate implementation. There are two main types of licences – provisional and full. Recognising the transitional period that clubs will be in when the regulator comes in, this two-tiered licence system will allow clubs to adjust to the new regime accordingly.

Provisional licence

To obtain a provisional licence, the below mandatory conditions must be complied with. Clubs must:

  • submit a financial plan to the IFR showing the club’s funding, revenues, financial risks and mitigations;
  • Publish a corporate governance statement explaining how they are applying the Football Club Corporate Governance Code (Code to be published after consultations with the IFR, FA and relevant stakeholders);
  • Consult representative group of fans on issues of importance to the club (e.g. club heritage and business matters);
  • Present an annual declaration to the IFR, highlighting any material changes in circumstances or compliance in the preceding year.

In addition to the above, clubs must prove to the IFR that they comply with the duties on regulated clubs. Clubs must prove that they are:

  • not playing in and IFR prohibited competitions;
  • seeking IFR’s approval before selling or relocating from their home stadiums or using the grounds as collateral for a loan;
  • establishing the support of a majority of a club’s domestic fans before amendments to the crest, emblem and home shirt colours. Clubs must also seek FA approval before any changes to club names are made.
  • keeping fans in the loop with regards to any developments in insolvency proceedings, should the club be in administration proceedings. IFR approval will also be required prior to the club appointing an administrator.
  • rendering an up-to-date personnel statement to the IFR stating a club’s owners, directors and senior managers, and include their roles and responsibilities within the club.
  • informing the IFR of material changes in circumstances affecting the club that are within the remit of the IFR’s functions

The provisional licence is given for an initial period of 3 years with the possibility of an extension if deemed necessary. The club will need to reach the required standard for a full licence before the end of the provisional licence period.

Full Licence

To obtain a full operating licence from the IFR, the club will need to show a continued compliance of the mandatory conditions set out in the provisional licence and have none of the club’s existing directors and owners deemed unsuitable by the IFR. Furthermore, there will be “Threshold Requirements” that will need to be met – these will be set out in statute and guidance will be released in due time with the formation of the IFR. These threshold requirements will focus on:

Financial resources: Clubs will have to show that they can protect the clubs value and core assets such as the stadium. Clubs must show that they have the appropriate financial resources to meet cash flow requirements, even in the event of a financial shock.

Non-financial resources: Clubs must show that they have the appropriate policies and internal structures in place that work towards managing risk.

Fan engagement: Implementation of regular consultations with fans on matters which include the clubs strategy, objectives, business priorities, club heritage, matchday and operational matters, and plans relating the fan engagement.

Once all the above elements have been satisfied, the club will be granted a full operating licence, and this will have no expiry date. Clubs will be monitored ensure continued compliance with the requirements and must be prepared to make amendments if deemed necessary by the IFR.

Discretionary Licence

This is a bespoke licence with specific conditions placed on a provisionally licensed club in the event that the club does not meet the threshold requirements following the end of the provisional period. The IFR can also place discretionary licence conditions on fully licensed clubs if they are not meeting the threshold requirements. The conditions will be proportionate to the issue being faced by the club and will be aimed at raising the standards of the club to meet the threshold level. However, the IFR will look to involve the relevant league and give them the opportunity to resolve the matter first. The league can offer a commitment in lieu of a discretionary licence condition being placed on a club. If this commitment is deemed to achieve the same goal as the proposed discretionary condition, then the IFR can accept it.

Owners and Directors Test (ODT)

There are currently three ODTs across English football. The Premier League and EFL administer their own tests, while the FA oversees the rest (e.g., Women’s leagues and National League).

The Fan-Led Review describes these ODTs as inadequate because it is an objective test that questionable owners in the past have been able to pass. An example of its inadequacy is highlighted in the purchase of Bury FC from previous owner, Stewart Day, where the new owner, Steve Dale, presented evidence of the financial issues of the club to the EFL, thereafter allowing him to purchase Bury FC for £1 without needing to show evidence of financial funding (Maguire, 2022).

However, following the review of the case by Jonathan Taylor KC, significant inadequacies were highlighted to the test and changes were made to the rules to avoid such loopholes being exploited again (Conn, 2020). This is exemplified in the Rochdale case where an independent disciplinary commission banned Andrew Curran, Darrell Rose, David Bottomley and Faical Safouane from operating as a Relevant Person, following a breach of the modified test prescribed by the League (BBC, 2022).

Despite these improvements, some stakeholders argue that the tests remain outdated. The IFR will therefore implement a statutory, enhanced ODT, which includes:

  • Fitness Test (owners and directors): This will assess an individual’s integrity, honesty and financial soundness and, competence (only applied to directors). This will be similar to the ‘fit and proper test’ that is conducted by the SRA,FCA and HMRC.
  • Source of Wealth Test (owners only): This will be conducted to ensure financial sustainability within the league, and protect clubs against adverse financial injections.
  • Financial Plans and Resources (owners only) – This will also foster financial sustainability as prospective owners will present plans on how they intend to operate the clubs, highlighting estimated costs and source of funding.  

Prospective owners and directors will have to pass all the above elements to be deemed suitable for the role. The IFR will also have the power to apply these tests to incumbent owners and directors where it deems appropriate, should there be concerns an owner or director’s suitability. However, the only tests that will be applied to an incumbent owner and directors are the fitness test and the source of wealth test.

The IFR will have the below removal powers if an owner or director is deemed unsuitable:

  • Removal Directions: The IFR will direct that all reasonable steps are taken by a club to ensure that an unsuitable owner or director is removed by a specified date.
  • Ownership Removal Orders: This is applied in circumstances where a person fails to comply with a removal direction without providing a reasonable excuse and ensures the removal of the owner on the date specified. The removal order can include the appointment of trustees to make decisions on behalf of the owner.
  • Disqualification Orders: This order can be made disqualifying a person from being an owner or director of any regulated club. This order can be for a specified amount of time or indefinite period.
  • Activity Restrictions: The IFR will be able to issue out directions prohibiting an owner or director from conducting certain activities or exercising certain rights.
  • Interim Directors: Where deemed necessary, the IFR can appoint an interim director at a club to address concerns about a clubs operations or  its compliance with licence conditions.

Further Considerations

It will be interesting to see how the IFR fits in within the football governance network when established. The position of the IFR within the football governance network will be  process of establishing the IFR is one of contention. In an interview with a lawyer and former club executive, this point was reiterated particularly with regards to how it sits in line with FIFA and UEFA regulations concerned with the influence of governments on football. The interviewee pointed out that FIFA have placed strict sanctions on countries like India and Pakistan in the recent past and these were regarding  governments having too much influence on the football governing matters.

This is because FIFA controls every aspect possible of association football without the intervention of any public governmental bodies (FIFA, 2024, Art. 2). When applied to the case of the IFR, it is rather difficult to envision how an independent regulator with statutory powers will be placed within a governance network predicated on the notion of autonomy from national governments. However, the UK government’s response to the need for an independent regulator is that reform is required to the governance system and in order to carry out this reform, government intervention is needed. It is intended that the IFR once established, will take a light-touch, proportionate and such approach may satisfy FIFA and UEFA.

The introduction of the IFR does indeed mark a transformative moment in the governance of English football. The success of the regulator will ultimately depend on its ability to balance authority with collaboration,  and being able to drive sustainable change without compromising the integrity or autonomy of the game.

References

Paul Ononye
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