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From the 2026/27 season, the Premier League can penalize clubs under its new Squad Cost Ratio (SCR) and Sustainability and Systemic Resilience (SSR) rules, including domestic points deductions for crossing SCR’s Red Threshold. UEFA’s separate 2026 financial rules set a 70% squad-cost ceiling; breaches can trigger financial measures and, in significant cases, further UEFA competition sanctions. A Premier League club in UEFA competition may have to comply with both systems.
Which rules apply, and when?
The Premier League and UEFA regulate different things. The Premier League’s rules apply to its member clubs in domestic competition. UEFA’s licensing and financial-monitoring rules apply to clubs seeking or taking part in UEFA club competitions. A club that qualifies for Europe does not swap one rulebook for the other: it can be accountable under both.
- Through 2025/26: Premier League Profitability and Sustainability Rules (PSR) remained in effect. The League says it retains powers to start or continue enforcement for those earlier assessment periods, so a case decided after 2025/26 can still concern PSR rather than the new rules.
- From 2026/27: Premier League SCR and SSR replaced PSR. The League monitored SCR in shadow form during 2025/26 without taking enforcement action for SCR breaches. Under the live system, sporting sanctions apply for crossing the Red Threshold; SCR levies become payable from 2027/28.
- From 1 June 2026: UEFA’s 2026 edition of the Club Licensing and Financial Sustainability Regulations took effect. Article 94 sets the squad-cost ceiling at 70%.
These dates matter when interpreting a club’s case: a Premier League PSR charge about an earlier period is not an SCR case, even if the decision arrives under the new system.
What does each regulator measure?
| Regulator and rules | Main test | Other financial checks |
|---|---|---|
| Premier League SCR and SSR, from 2026/27 | SCR limits on-pitch spending to 85% of football-related revenue plus net profit or loss on player sales, as described in the League’s 2026 explainer. The system also has Green and Red Thresholds. | SSR assesses short-, medium- and long-term financial health through Working Capital, Liquidity and Positive Equity tests. |
| UEFA 2026 regulations | Article 94 sets a maximum squad-cost ratio of 70%. | UEFA’s wider framework also covers solvency and stability, including no-overdue-payables and football-earnings requirements. |
The 85% and 70% figures should not be treated as directly interchangeable caps. They belong to separate rulebooks, and the supplied regulatory descriptions do not establish identical reporting definitions or calculations. In particular, the Premier League describes Green and Red Thresholds in addition to its 85% baseline; 85% alone is not the whole sanction test.
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What can the Premier League penalize under SCR and SSR?
SCR: a levy or domestic points deduction
The Premier League’s 2026 explainer describes two SCR outcomes. A club above the Green Threshold but below the Red Threshold may face a financial levy, subject to the levy-offset mechanism. The League’s example calculates the levy using the applicable overspend multiplied by the percentage by which the ratio exceeds 85%.
Crossing the Red Threshold brings a sporting sanction: a domestic points deduction calculated under SCR. The League’s explainer summarizes the formula as six points, plus one additional point for every £6.5 million spent over the Red Threshold. That is the explainer’s summary; the precise application to a particular club depends on the current Premier League Handbook and the relevant assessment.
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SSR: corrective requirements and possible further measures
SSR addresses financial health rather than simply the squad-cost ratio. If a club fails a test, the League may require a business plan setting out how it will return to compliance. If the club does not submit a satisfactory plan, the Board may impose measures such as requiring approval before new contracts are registered, setting a spending limit, or using disciplinary powers under Rule W.3. An SSR issue does not automatically mean a points deduction.
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For PSR breaches under the former rules, an independent Commission can impose fines, points deductions or other sporting sanctions, with appeals handled independently. Everton illustrates how an appeal could alter a penalty: after the club admitted a PSR breach for the period ending in 2021/22, a Commission imposed a 10-point deduction and an independent Appeal Board substituted six points. The Premier League announced that appeal outcome on 26 February 2024. This is a historical PSR case, not a precedent for the SCR formula.
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What can UEFA penalize under its financial rules?
Squad-cost breaches: financial measures, with escalation for significant cases
For a squad-cost ratio above 70%, UEFA’s Club Financial Control Body (CFCB) calculates a financial measure as a percentage of the excess. Under Articles L.1, L.3 and L.4 and Annex L.4 of the 2026 regulations, the percentage depends on the amount of excess and how many breaches the club has had in the current and previous three licence seasons.
UEFA withholds the measure from the club’s UEFA solidarity and prize money. If those distributions do not cover it, the club must pay the remainder by the deadline set by the CFCB. Significant breaches can also lead to additional disciplinary measures under the CFCB procedural rules.
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Other UEFA monitoring outcomes: registration limits and competition exclusion
UEFA’s 2025/26 monitoring report describes fines for football-earnings and squad-cost breaches, and restrictions imposed on some clubs against registering new players on List A for the 2026/27 UEFA competition season. UEFA settlement arrangements can also set intermediate targets and conditional sporting measures, including exclusion from the next UEFA club competition for which a club qualifies.
Those are UEFA competition measures. A UEFA restriction on List A registration or participation is not a Premier League domestic sanction, and UEFA’s financial measure is not the Premier League SCR levy.
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Can the Premier League deduct points for a financial breach?
Yes. Under the 2026/27 SCR framework, crossing the Red Threshold results in a domestic points deduction calculated under the SCR rules. The Green-to-Red band is associated with a possible levy instead. For earlier assessment periods through 2025/26, a PSR case could also result in a points deduction, as the Everton appeal demonstrates.
Can UEFA ban a club from Europe?
UEFA’s monitoring and settlement arrangements can include exclusion from a future UEFA club competition for which a club qualifies. That is distinct from the squad-cost financial measure itself, which is calculated against the excess and normally withheld from UEFA distributions. The 2025/26 monitoring report also records List A registration restrictions for some clubs, a narrower measure than exclusion from a competition.
Why one club can face two different penalties
The regimes address separate obligations. The Premier League applies its domestic SCR and SSR requirements to its member clubs; UEFA applies its own licensing, squad-cost and broader financial requirements to clubs in its competitions. A club’s domestic compliance does not establish UEFA compliance, or vice versa. Accordingly, the same spending or financial-health concerns can be examined under both systems, but the tests, decision-makers and sanctions are not interchangeable.
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