The regulator will have the power to fine clubs up to 10 percent of their turnover for failing to comply with financial rules.
The British government plans to establish an independent football regulator to oversee the sport and encourage financial stability through a bill introduced in parliament.
The regulator will be independent of the government and football authorities and will have the power to fine clubs up to 10 percent of their turnover for failure to comply with financial regulations, the government said in a press release on Tuesday.
The legislation will strengthen suitability tests for clubs they run and would also block “closed competitions” such as the oft-proposed European Super League.
Clubs will also be required to consult fans on issues such as strategic direction and anything that affects their assets.
“For too long some clubs have been abused by unscrupulous owners who get away with financial mismanagement which, in the worst case scenario, can lead to total collapse,” Prime Minister Rishi Sunak said.
“This bill is a historic moment for football fans: it will ensure their voices are front and centre, prevent a breakaway league, protect the financial sustainability of clubs and protect the assets of our clubs, big and small. “.
“Football is nothing without its fans,” said Culture Secretary Lucy Frazer.
“We are determined to put them back at the center of the game and ensure clubs, as vital community assets, continue to thrive.
“Football's new independent regulator will put the game on a sustainable footing, strengthening clubs and the entire football pyramid for generations.”
Faced with a possible reduction in its powers, the Premier League – the most watched and most lucrative domestic league in the world – said it will study the bill and work closely with the government, having previously expressed concerns about how a regulator could potentially damage the the league's ability to attract investment.
“Aware that the future growth of the Premier League is not guaranteed,” the competition said on Monday, “we remain concerned about any unintended consequences of legislation that could weaken the competitiveness and attractiveness of English football.”
The government's announcement comes after the Premier League failed last week to reach a new financial deal with the English Football League (EFL), which runs professional football at lower levels.
The government had warned the Premier League in February that it needed to agree a new deal or have one imposed on it.
'Why change winning a formula?'
The EFL welcomed the bill.
“We hope this is an important milestone that helps us ensure the long-term financial sustainability of the England football pyramid,” chairman Rick Parry said in a press release.
“The establishment of an independent football regulator will be at the heart of this reform, and we are encouraged that it will be given back-up powers to make financial redistributions in the event that football is unable to reach a deal itself.”
David Sullivan, owner of Premier League club West Ham United, said he opposed setting up a regulator and suggested it would be costly and inefficient.
“The Premier League is the best league in the world, so why change a winning formula?” he told Sky News.
“I hope the government doesn't ruin something that works. This means we will compete with teams from European leagues who give a fraction of the money that Premier League clubs give to both the EFL and grassroots football.
“If in the coming seasons the Premier League stops being the best league in the world, it will be the fault of an interfering government.”
