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Everton deducted two points for breaching Premier League Profitability and Sustainability Rules for second time

Everton deducted a further two points for another Profitability and Sustainability Rules breach and drop one place to 16th; they were docked 10 points in November for breaching PSR, reduced to six after appeal; watch Everton's next five games live on Sky Sports

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Sky Sports reporter Anton Toloui explains why Everton have been deducted two more points by the Premier League

Everton have been deducted two points for another breach of the Premier League's Profitability and Sustainability Rules (PSR).

Before the points deduction was announced, Everton sat 15th in the Premier League table, four points above the bottom three. They now drop below Brentford into 16th place on 27 points, two points and two places above 18th-placed Luton.

According to the written reasons published by the independent commission handling the case, Everton breached their allowed spending of a £105m loss over three seasons by £16.6m. The Premier League and the commission initially wanted to impose a five-point deduction on the club, but it was reduced to two on mitigating factors.

Everton - who argued for a one-point deduction to be deferred until next season - say they and their legal team have "begun the preparations to appeal the Commission's decision". Should they confirm that appeal, then a decision on that must be heard by May 25, which is the week after the end of the Premier League season.

Image: How the bottom half of the Premier League table now looks

Everton were also deducted 10 points in November for exceeding permitted losses by £19.5m over a period ending with the 2021/22 season. However, this was reduced to six points following a successful appeal.

Everton were charged again in January, along with Nottingham Forest, for breaching PSR rules over a period ending with the 2022/23 season. Forest were handed a four-point deduction and have appealed against the decision.

The written reasons for this latest case stated Everton argued multiple mitigating factors - including the fact they already been penalised for some seasons which overlap the new breach, the loss of sponsorship from USM Services due to the Russian invasion of Ukraine and the fact they admitted breach at the first opportunity.

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The commission felt the breach is "broadly consistent" with the four-point deduction handed to Nottingham Forest. They added: "At the final stage of the assessment, the Premier League submitted that a sanction of anything less than three points would undermine the integrity of the Premier League and the aims of the PSR."

'Everton now have clarity'

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FREE TO WATCH: Highlights from the Premier League match between Everton and Burnley

Sky Sports News' Anton Toloui at Goodison Park:

"The points deduction is based on what has been called a 'significant breach' of the rules. They were allowed to lose up to £105m. They had already been deducted 10 points for breaching those rules in the previous financial year, which was reduced to six on appeal.

"They released their accounts for last year last week and it was an £89.1m loss. Everton lost significant revenue in that period, such as the USM sponsorship deal through Alisher Usmanov.

"The Premier League are saying they have taken double jeopardy into account, but Everton have breached the rules and they felt there had to be a sanction.

"They are trying to set a benchmark for other clubs to follow these rules because there is so much ambiguity over what has happened with Everton and Nottingham Forest.

"The Premier League season finishes on May 19 but they have set aside May 25 to have all these appeals heard and dealt with. They would love everybody to know where they stand going into the final weekend but can't guarantee that at the moment.

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Football finance expert Kieran Maguire explains how the Premier League came to its latest punishment of Everton and how they could face further points deductions next season

"At least Everton now know the worst-case scenario. They are now two points above the relegation places and they have some huge games, starting with Monday Night Football against Chelsea (next week). They then face three games at Goodison Park in just six days.

"In a points-deduction derby, they take on Nottingham Forest, then Liverpool in the Merseyside derby, and then Brentford - who they are now two points below in the table.

"Remember, they still have to play Luton and Sheffield United. Sean Dyche was saying he just wanted clarity and they now have that."

Everton's response to the deduction in full

"While the club's position has been that no further sanction was appropriate, the club is pleased to see that the Commission has given credit to the majority of the issues raised by the club, including the concept of double punishment, the significant mitigating circumstances facing the club due to the war in Ukraine, and the high level of co-operation and early admission of the club's breach.

"Everton remains committed to working collaboratively with the League on all matters relating to PSR but is extremely concerned by the inconsistency of different commissions in respect of points deductions applied.

"The club would like to place on record its thanks to the Fan Advisory Board and other fan groups for their submissions during this process, and to all Evertonians for their ongoing patience and unstinting support.

"The club and its legal representatives have begun the preparations to appeal the Commission's decision."

What do the written reasons say?

Premier League written reasons for Everton's second points deduction

Sky Sports' Anton Touloi on the independent panel's 60-page written reasons for the decision:

"Originally a five-point deduction was suggested for Everton's PSR breach. Two points were taken off due to 'overlapping years of assessment' for the period where they deducted points previously.

"A further point was removed due to unexpected revenue loss and an early guilty plea submitted by the club. Everton requested for the punishment to be deferred to next season which was rejected by the panel.

"There's so much in this about the Nottingham Forest situation and the cases between the two. The panel found the decision was not 'disproportionate to the Nottingham Forest decision'.

Premier League written reasons for Everton's second points deduction

"The Premier League and Everton are still in dispute over a £6.5m loss linked to stadium finance. That is something that could come up in front of another hearing which is likely to go into next season.

"The tribunal found that attempts to maximise player values by selling later 'does not overshadow' PSR compliance. Everton said they didn't want to sell players because they wanted to get as much money as possible. The tribunal has found that there's no mitigation there. If you need to sell players to make up for lost money, then you need to do so."

PSR explained: What limits clubs spending more?

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Sky Sports' Sam Blitz explains what the Premier League's profitability and sustainability rules are and how they affect clubs' ability to spend

In the simplest terms, when every Premier League team tots up their annual accounts, they can have made a loss no greater than £105m across the previous three seasons.

Clubs can only lose £15m of their own money across those three years. So that's no more than £15m extra on outgoings like transfer fees, player wages and, in a lot of clubs' cases, paying off former managers compared to their income from TV payments, season tickets, selling players and so on.

The other £90m of any £105m must be guaranteed by their owners buying up shares, known as 'secure funding', and essentially means bankrolling the club.

Everton's fixture run-in

Monday April 15: Chelsea (a) - kick-off 8pm, live on Sky Sports' Monday Night Football

Sunday April 21: Nottingham Forest (h) - kick-off 1.30pm, live on Sky Sports

Wednesday April 24: Liverpool (h) - kick-off 8pm, live on Sky Sports

Saturday April 27: Brentford (h) - kick-off 5.30pm, live on Sky Sports

Friday May 3: Luton (a) - kick-off 8pm, live on Sky Sports

Saturday May 11: Sheffield United (h) - kick-off 3pm

Sunday May 19: Arsenal (a) - kick-off 4pm

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