Nottingham Forest have received a four-point deduction for breaching the Premier League’s profitability and sustainability rules, dropping them into the relegation zone, one point from the last safe spot.
The Premier League confirmed the decision in a statement that said Forest had “breached the relevant PSR threshold of £61m by £34.5m”, and Forest are likely to appeal. Luton, with whom Forest drew 1-1 on Saturday, have been lifted out of the bottom three by the punishment.
Forest admitted the breach but their defence was based around extenuating circumstances in relation to the sale of Brennan Johnson. The club received a £30m offer from Brentford early last summer but the forward was unwilling to move and Forest felt they could get more money for their star asset if they waited beyond the 30 June PSR deadline. Johnson was sold for £47.5m to Tottenham in September but an independent panel did not accept this defence.
With all money earned from selling Johnson, an academy product, going down as a profit, the club argued their approach was designed to make them more sustainable.
The Premier League commission ruling said: “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.”
Premier League clubs are allowed to lose £105m over a three-year period but Forest’s permitted losses were limited to £61m because they spent two years of that period in the Championship. This was another part of their defence, with the club claiming they were hamstrung after being promoted because investment in the squad is vital to challenge at a higher level against more established teams.
Since promotion Forest have signed 42 players at a cost of about £250m, helping them retain their Premier League status last season.
The commission described Forest’s breach as “serious” and said: “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.”
Forest were said to have demonstrated “exceptional cooperation” with the league throughout the disciplinary process.
