Decision on future of PSR 'coming up' - Masters

"A decision on whether to scrap the Premier League's controversial profit and sustainability rules (PSR) and adopt an "alternative system" is "coming up", says chief executive Richard Masters. The current regulations, introduced in 2015-16 to prevent clubs from overspending, allow losses of 105m over a three-year reporting cycle. However, they have been criticised by several top-flight teams for limiting their ability to invest."

"It's about closer alignment with European regulation, which is squad cost ratio, which is a revenue test. In Uefa, it's now set at 70%. Our system will be 85% because we always want our clubs to have the ability to invest. The Premier League has been built on the back of investment in which international capital flows [are] coming in. We don't want that to be to be stifled off."

"However a squad cost ratio (SCR) system of financial control was adopted by the Premier League on a shadowing, non-binding basis. SCR is similar to Uefa's existing financial rules and allows clubs to spend up to a percentage of their total revenues on squad-related costs. Nine of the league's 20 clubs already have to comply with Uefa's SCR as a result of qualifying for Europe. Both Chelsea and Aston Villa were fined by Uefa in July for breaching the rules."

An impending decision will determine whether the Premier League replaces its profit and sustainability rules (PSR) with an alternative financial control system. PSR, introduced in 2015-16, permits losses of 105m over a three-year reporting cycle and has led to sanctions including point deductions for Everton and Nottingham Forest. Clubs adopted a non-binding squad cost ratio (SCR) shadow regime similar to UEFA's model, which limits squad-related spending as a percentage of revenue. The Premier League proposes an 85% SCR to align with UEFA (currently 70%) while preserving capacity for investment. Several clubs and owners have criticised PSR as restrictive.

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