Nottingham Forest were handed a four-point deduction on Monday for overspending, dropping the team into the Premier League’s relegation zone with two months left in the season.
Forest was found to have breached the league’s profitability and sustainability regulations, which typically allow clubs to lose a maximum of 105 million pounds ($133 million) over a three-year period or face sanctions.
Forest’s assessment period ended in 2022-23 and therefore included two seasons when the club was in the second-tier Championship.
For that reason, Forest was permitted losses of up to 61 million pounds ($77 million) in its first year back in the Premier League last season and the club went above the threshold by 34.5 million pounds ($44 million), having made an unprecedented 21 off-season signings at a cost of $160 million following promotion.
The team managed by Nuno Espirito Santo fell from 17th to 18th — one of the three relegation places in the league — and onto 21 points with nine games remaining. Luton, on 22 points, climbed out of the relegation zone as a result.
The sanction was handed out by a three-person independent commission following a hearing this month.
Forest didn’t immediately say if the club would appeal against the points penalty. If it did, the verdict might not be decided before the final round of games in the league on May 19.
That raises the potential for the identity of the relegated teams only being known in the days after the season has finished, which would be hugely controversial.
Everton recently had a points deduction — for breaching spending rules in the three-year assessment period ending 2021-22 — reduced from an initial 10 to six following an appeal.
Everton, which is also embroiled in the relegation battle, could receive another points deduction soon for breaching the rules again — this time for the assessment period ending 2022-23.