- 24 July 2025
It’s been quite a week for regulators in the UK. Just as the government announced plans to consolidate the regulatory functions of multiple bodies overseeing the water business, scrap Ofwat and establish new watchdogs for England and Wales, another industry is about to come under a regulatory regime for the first time.
The English Premier League is currently the undisputed leader in global football revenue, generating in excess of £6 billion annually, driven by international broadcasting rights. Of the 30 highest revenue-generating clubs globally in the Deloitte Football Money League, 12 are English. However, despite the Premier League’s undoubted success, there have been long-standing concerns about the resilience of English football at all levels: Morecambe FC are the latest to face a bleak and uncertain future. Many clubs are loss-making, even at the top level. The 20 Premier League clubs reported a combined pre-tax loss of £728m for the latest reporting period, according to UEFA, while Deloitte found that their counterparts in the Championship lost £318m before tax in 2023/24. Debt levels are perilously high, risk-taking endemic and cost controls in seemingly short supply.
As football has developed, its governance has failed to professionalise at the same rate and the game has persisted with a preference for self-regulation. Reforming football governance has been on the political agenda for many years, with substantial reports in 2011 and 2013. It was, however, the publication of the Fan-led Review in November 2021 that was the key moment in the campaign for reform in English football governance. Its recommendations received cross-party support.
What is the IFR?
After receiving Royal Assent this week, the consequent Football Governance Bill – initiated under the previous Conservative administration and reintroduced by the current government – has now become law. The Act will establish a statutory regulator with unprecedented powers in the game. The Independent Football Regulator will have under its purview the top five tiers of English men’s football, comprising 116 clubs in total.
David Kogan OBE, chief broadcasting rights adviser for the Premier League from 1998 to 2015, was named as the Government's preferred candidate to chair the IFR in April, and his appointment was endorsed by Parliament’s Culture, Media and Sport Committee of MPs in May. The CEO has not yet been appointed, although Martyn Henderson OBE was appointed as interim Chief Operating Officer in December 2023 to lead the preparatory work. Recruitment has hastened noticeably since the Bill passed into law.
Why was it created?
The Bill was laid before Parliament in response to longstanding concerns about issues in English football, including:
· Misgivings over the financial sustainability of many clubs throughout the English pyramid and the incidence of administration and insolvency proceedings
· Concerns about the suitability of some club owners
· The lack of fan involvement in the running of clubs
· The threat that elite clubs may quit the Premier League and join a closed European league or other ‘breakaway’ competition
What will the IFR do?
The IFR will operate a licensing system for clubs in the Premier League, English Football League and National League, requiring them to meet specific standards in governance, financial regulation, fan engagement, and heritage protection. Key powers of the IFR within the new licensing system are as follows:
· Publishing a mandatory “Football Club Corporate Governance Code” for clubs to report against
· Requiring clubs to engage fans on certain decisions (such as changes to the club name or crest, ticket price increases and home ground relocations)
· The power to vet the suitability of incumbent and prospective owners and directors and to reject candidates who fail these enhanced tests
· Monitoring the finances of clubs so that the IFR will be aware when they are in financial difficulty
· Requiring clubs to submit a business plan
· Intervening in financial distributions between leagues if necessary due to lack of consensus (the “backstop” power)
· Blocking clubs from joining “unmeritocratic” competitions
· Wide discretionary powers enabling the IFR to impose tailored conditions on clubs it regards as being in financial difficulty
The IFR will also publish a regular "State of the Game" report assessing the financial health and market structure of the football industry.
Are there any questions remaining?
Overall, the new regulator is a positive development. Successful application of a new governance code ought to improve the quality of decision making and provide a sound framework for oversight. A focus on financial sustainability and cost control, and a curbing of excessive risk-taking, is long overdue. There is no mystery as to why so many clubs experience financial hardship: they spend more than they generate, making them dependent on the largesse of owners and vulnerable to debt. In total, the changes could usher in a virtuous cycle of industry improvement.
However, a number of uncertainties remain:
· The response of current and potential club owners and investors to the new regime is perhaps the greatest unknown. Premier League clubs are wary that regulation will dull the league’s competitiveness. Many English clubs are highly dependent on cash inflows from wealthy owners to stay afloat. If the new regulatory regime (which is explicitly based on the “prudential regulation” model of financial services) frightens off investors then competing countries (such as Spain, Italy, France and Germany) could be the main beneficiaries of the “capital flight”.
· The impact of the new regime on club costs is also at present unknown. It is intended that the regulatory burden not be excessive. Clubs already have to submit financial information to their respective leagues and to Companies House, to Uefa for those participating in European competition, and in some cases have to provide relevant disclosures as listed companies. So the collation of this information ought not be problematic. Compatibility of reporting requirements and proportionate application of both regulatory and governance obligations will ease the burden and make compliance sustainable. On the latter, the Code for Sports Governance offers an example, adopting a tiered approach with three levels in terms of prescriptiveness and the number of mandatory requirements and a reasonable timeline for achieving compliance.
· The regulator will need to pick its way carefully through varied opinions on its purpose and necessity, including those vehemently opposed to its establishment, as well as on the extent and use of its powers. The sooner it can establish a positive relationship with the game’s many stakeholders the better.
· How will the code of governance for football accommodate the game’s particular circumstances? For instance, codes currently operating in the sports sector take as their starting point the board having primacy for decision making. When clubs are trophy assets for billionaire owners, states and sovereign wealth funds, can we assume that the locus of decision making is always in the boardroom?
We should not assume that all of football’s problems will disappear as soon as the IFR is up and running (and there will be a period of consultation before the Act is implemented). The culture of financial imprudence and excessive risk taking will take time to change.
As we have seen elsewhere in the sports sector, organisations subject to a new governance landscape will require some time as well as support, guidance and possibly training to successfully implement new requirements. Since 2020 the Chartered Governance Institute UK & Ireland has partnered with all of the Sports Councils of the UK to deliver the Sports Governance Academy, a comprehensive package to train, upskill and connect those engaged in governance in the sports sector. With 80% of respondents to a recent survey saying that the SGA helps their organisation contribute to a culture of good governance across the sector, this might offer a template for English football to get to grips with the potentially watershed developments that are now on its doorstep.