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Nottingham Forest drop into Premier League relegation zone after four-point deduction for PSR breach

Nottingham Forest docked four points for breaching Premier League financial rules; Forest drop to 18th in the top flight - one point behind 17th-placed Luton; Forest have seven days to appeal but Sky Sports News understands club are consulting with lawyers over whether to do so

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Nottingham Forest have been given a four-point deduction for breaching the Premier League’s profit and sustainability rules, dropping them down into the relegation zone

Nottingham Forest say they are "extremely disappointed and dismayed" at being handed a four-point deduction for breaching the Premier League's Profitability and Sustainability Rules (PSR).

The deduction drops Forest into the relegation zone in 18th position, one point behind Luton, who move up to 17th, with nine games to play.

The Premier League said Forest admitted breaching PSR by £34.5m above their permitted threshold of £61m.

Forest have dropped into the bottom three
Image: Forest have dropped into the bottom three

Clubs are usually allowed maximum losses of £105m over a three-year assessment period but this is reduced by £22m per season for any seasons within the period spent in the Championship.

Forest are unhappy about the Premier's League's submission to the independent commission, which imposed the sanction, and claim trust in the governing body has now been eroded after it pushed for a six-point sanction (as pictured below) - with eight points as an initial figure.

Nottingham Forest, points deduction reasons

A Forest statement read: "Nottingham Forest is extremely disappointed with the decision of the commission to impose a sanction on the club of four points, to be applied with immediate effect.

"Notwithstanding our disappointment, we thank the commission for agreeing to deal with this matter on an expedited basis. The club considers it to be essential for the integrity of the league to have charges resolved in the season in which they are issued.

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"We were extremely dismayed by the tone and content of the Premier League's submissions before the commission.

"After months of engagement with the Premier League, and exceptional cooperation throughout, this was unexpected and has harmed the trust and confidence we had in the Premier League.

"That the Premier League sought a sanction of eight points as a starting point was utterly disproportionate when compared to the nine points that their own rules prescribe for insolvency."

Forest consulting lawyers as they consider appeal

Forest have seven days to appeal but Sky Sports News understands the club have yet to decide whether to do so, and are consulting with their lawyers.

Under the 'standard directions' for dealing with PSR complaints, any appeal outcome must be known prior to June 1, when promoted clubs receive their Premier League 'shares'.

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Sky Sports News reporter Rob Dorsett 'myth-busts' the biggest questions around Nottingham Forest's four-point deduction for breaching the Premier League’s Profit and Sustainability Rules.

The commission which imposed the sanction on Forest praised the club for their "exceptional co-operation" in their dealings with the Premier League on this issue.

The commission noted Forest's breach was "serious" and stated in its conclusion: "The four points sanction is not to punish Forest so much as it is to be fair to the other clubs; to give the public confidence that when a club invests as Forest did to compete in the Premier League, it still needs to comply with the PSR threshold for losses."

NOTTINGHAM, ENGLAND - FEBRUARY 28: A general view of the corner flag ahead of the Emirates FA Cup Fifth Round match between Nottingham Forest and Manchester United at City Ground on February 28, 2024 in Nottingham, England. (Photo by Ash Donelon/Manchester United via Getty Images)
Image: Nottingham Forest drop to 18th in the Premier League - one point from safety

The commission ruling added: "When a club like Forest took the risk of effectively ignoring the PSR warning from its finance director before the January window in 2023, and rather than looking to sell players, it added players to its squad, ultimately leaving itself with just two weeks to sell Player A (Brennan Johnson) in the summer 2023 window, such risk taking and 'sailing close to the wind' needs a proportionate sanction to maintain the integrity of the Premier League."

Everton were docked 10 points in November for breaching PSR in the period up to the 2021-22 season, which was reduced to six on appeal.

Could Forest's fate be decided after the end of the season?

Sky Sports News Senior Reporter Rob Dorsett:

"Forrest have up to Monday next week to decide if they are going to appeal or not. Then if they do decide to appeal, two or three weeks later, that appeal hearing will happen. Two or three weeks after that, we will get the final decision.

"So, any suggestion that Nottingham Forest’s situation could go beyond the end of the season, and the ultimate deadline of May 25, just simply won’t happen – Forest’s situation will be dealt with by the end of April, so it won’t go into the final weeks of the season. It is still pretty late in the season though.

"Everton’s situation is slightly different. They have not even had their independent commission hearing yet, so that could run close, but theirs is a more complicated situation as they have already been charged and punished already."

A second complaint against the Toffees over a breach in the period up to last season is still being dealt with.

The ruling shows the Premier League pushed for a six-point sanction - with eight points as an initial figure to account for Forest's excess over the threshold being 77 per cent greater than Everton's, but discounted by two points to reflect Forest's early plea and co-operation.

Forest's Johnson sale defence

Brennan Johnson celebrates scoring Tottenham's second goal of the game
Image: Brennan Johnson joined Tottenham in a £47.5m deal on Deadline Day

Forest's defence was centred around the £47.5m sale of Brennan Johnson to Tottenham on the final day of the 2023 transfer window, which occurred a short period later than necessary.

The commission said such an event could only have been described as a near miss "if it was truly near to the PSR deadline (June 30, 2023) or at the first available reasonable opportunity proximate to the deadline".

But Forest hit back, saying the ruling will make it impossible for newly-promoted clubs to compete in the league.

The statement added: "Whilst the Premier League may have called into question the club's business plan, the club maintains that it responsibly balanced compliance with PSR with important investment into the squad to give us the ability to compete in the league for the first time in over 20 years.

"Even after the club had missed the PSR reporting deadline, it still took steps to ensure Brennan Johnson was sold before the end of the transfer window. That was a clear demonstration of our respect and support for PSR.

"The commission's decision raises issues of concern for all aspirant clubs. The player transfer market is a highly specialised trading environment that cannot be compared to the sale of normal products and services.

"There will be occasions when a player transfer cannot be completed in the first half of a transfer window and can only be completed at the end of that window.

"This should not be a reason for the condemnation of a club. For this not to be recognised by the commission or the Premier League should be a matter of extreme concern for all fans of our national game."

Forest have seven days to appeal - but will they?

Nottingham Forest manager Nuno Espirto Santo plus club crest and owner.
Image: Nottingham Forest boss Nuno Espirito Santo (left) and the club's owner Evangelos Marinakis are hoping for Premier League survival

Sky Sports News chief reporter Kaveh Solhekol:

"Forest have seven days to decide whether they want to appeal or not. A lot of people will think it's a no-brainer. Everton got it reduced from 10 to six points, give it a go, what have you got to lose?

"A new three-person panel will hear that appeal.

"But at an appeal you can't introduce any new evidence. You can just argue your case again and hope for the best. Forest have already admitted they've broken the rules.

"From a football point of view, there may be people within Forest who may be saying this cloud has been hanging over us for a long, long time. Let's just take the four points. We know what we need to do to stay up. We've still got nine games to play. We've got the squad to be able to stay in the Premier League. This has been too much of a distraction.

"It's a big decision they need to take, whether to appeal or not."

Nottingham Forest fixtures

  • Crystal Palace (H) - Saturday March 30, Premier League, kick-off 3pm
  • Fulham (H) - Tuesday April 2, Premier League, kick-off 7.30pm
  • Tottenham (A) - Monday April 8, Premier League, kick-off 8pm, live on Sky Sports
  • Wolves (H) - Saturday April 13, Premier League, kick-off 3pm
  • Everton (A) - Saturday April 20, Premier League, kick-off 3pm
  • Manchester City (H) - Saturday April 27, Premier League, kick-off 3pm
  • Sheffield United (A) - Saturday May 4, Premier League, kick-off 3pm
  • Chelsea (H) - Saturday May 11, Premier League, kick-off 3pm
  • Burnley (A) - Sunday May 19, Premier League, kick-off 4pm

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