Key Elements of the Football Governance Act 2025
Since receiving Royal Assent in July, the Football Governance Act has established a comprehensive framework for the governance of English football. The Act introduces an Independent Football Regulator (IFR) that aims to ensure the sustainable operation of clubs, with a focus on financial regulation, owners and officers checks, fan involvement, and “heritage” protection. Further, the Act includes backstop or oversight powers for the distribution of revenues between certain stakeholders. The Act has been described as one of the most comprehensive pieces of football governance-related legislation existing anywhere in the world
This Client Alert sets out the key elements of the Act and highlights how this new piece of legislation affects the football industry.
Establishment of the Independent Football Regulator
The IFR will be a public body tasked with regulating football clubs in the top five English leagues, ensuring compliance with governance standards and promoting the sustainability of the sport while attempting to avoid impacting the sporting competitiveness of clubs. The IFR will have three primary objectives:
- Protecting and promoting the financial soundness of clubs
- Enhancing the systemic financial resilience of English football
- Safeguarding the heritage of the sport
The IFR will operate independently, with powers to enforce regulations, conduct investigations, and issue sanctions when necessary — all procedurally effected via granting “operating licences” to clubs, which may come with a licence fee or levy. How this independent approach will interact with existing league and Football Association (FA) rules and processes will be key. The Act is clear that the IFR will not have a role in regulating sporting matters or in clubs’ specific commercial decisions. However, inevitably, the lines between regulation, commerciality, and financial sustainability are not always bright.
Financial Sustainability
A key IFR objective is to protect and promote the financial resilience of English football (per the Act, “the systemic financial resilience objective”). As a result, clubs will have to submit detailed financial plans to the IFR, outlining funding sources, expected revenues, expenses, and risk management strategies. Every club must prepare, maintain, and publish a corporate governance statement that demonstrates how it applies the IFR’s Code of Practice on corporate governance and the steps the club is taking to improve equality, diversity, and inclusion. The IFR will publish each statement and issue periodic reports benchmarking compliance, meaning that robust internal governance standards are now a licensing prerequisite rather than a best practice. The IFR will evaluate these plans and statements to ensure clubs have appropriate financial resources to support their operations and maintain long-term sustainability.
The IFR has various tools to navigate any concerns, including the ability to impose debt limits, liquidity requirements, or restrictions on a club’s overall expenditure, to direct remedial governance measures and, in more extreme scenarios, to suspend or revoke an operating licence or impose substantial financial penalties. Again, interaction with existing league regimes will be key.
The Act addresses interactions between the IFR and the specified competition organisers (principally the Premier League (PL), the English Football League (EFL), and the FA). An organiser must notify the IFR of any suspected club breach of competition rules and consult the IFR before imposing a sanction. Further, an organiser must also consult the IFR in advance of adding, removing, or materially varying any relevant rule. These notice-and-consultation duties may impose operational constraints on the PL, EFL, and FA, and, by extension — in the case of the EFL and the PL— their shareholding clubs.
“Individual Ownership Fitness Criteria”
The IFR will assess the suitability of prospective and incumbent owners and officers of football clubs, focusing on criteria such as honesty, integrity, competence, and financial soundness. Individuals who fail to meet these criteria may be disqualified from holding ownership or officer positions within clubs. The IFR will have the authority to issue disqualification orders and removal directions to ensure that a club’s leadership aligns with the regulatory standards. As before, how this authority will interact with existing PL, EFL and FA rules and “owners and directors test” processes.
There have been a number of consultations addressing sanctions, information-gathering and enforcement, and the ambit of the owners, directors, and senior executives regime. For example, on 4 September 2025, the “consultation on the statutory deadline for the Act’s owners’ and directors’ tests” was launched, inviting stakeholders to share their responses on how long the IFR can take to make a determination on the suitability of new owners and officers. Another consultation focused on the IFR’s approach to information-gathering and its enforcement powers, specifically its ability to gather information from all football industry stakeholders and to take action against those who fail to comply with the rules or obligations as imposed by the Act or IFR.
Revenue Distribution — New Backstop Powers
Historically, the PL and the EFL would discuss and then attempt to decide on financial distribution matters without a formal regulatory framework or recourse to a third party to resolve any disagreements.
The main (and, possibly, most powerful) tool that the Act contains is granting the IFR certain powers to intervene in the distribution of broadcast revenue. This is designed to ensure financial sustainability and the protection of the football pyramid. The Act grants the IFR backstop powers that allow the IFR to intervene in the distribution of revenue from the PL to the EFL, and, if having followed a process set out in the Act, the PL and EFL cannot come into agreement, to impose a settlement. Notably, the power to impose a settlement is a final resort following the conclusion of a step-by-step process detailed in the Act.
Similar backstop powers exist within British horseracing, in which legislation imposes a levy on bookmakers who are required make an “enforced” contribution back to the horseracing industry. The Betting Levy Act 1961 contains mechanics by which, if the bookmaking and horseracing industries do not reach negotiated agreement, the Secretary of State is entitled to make a determination. The IFR will have analogous powers.
Club Heritage Protection
The Act includes provisions to safeguard the “heritage” of clubs, such as restrictions on changing team names, crests, and home shirt colours without fan support (with the Act also focusing on regular consultation with fan representatives on relevant matters). Clubs must seek IFR approval before relocating or making significant changes to their home grounds; the IFR will evaluate the impact of proposed changes on club heritage and fan sentiment, promoting the preservation of historical and cultural assets. Some clubs have already enshrined similar concepts within their corporate arrangements and organisational documents.
Restrictions on Joining Prohibited Leagues
Clubs are prohibited from participating in competitions deemed “prohibited” by the IFR. The IFR will consider factors such as whether the competition in question is merit-based and fair, and also its potential impact on the sustainability of existing competitions and clubs.
The IFR will consult with stakeholders, including fans and the FA, before designating a competition as prohibited. This provision aims to protect the integrity and sustainability of English football by preventing participation in leagues that undermine established competitions.
Conclusion
The Act signals a shift in football regulation, poses many questions, and features many nuances — some of which will not be welcomed by all of the ecosystem’s many stakeholders.
The Act’s development through secondary rules and the IFR’s consultation processes will be critical to determining its implementation and impact; consultations commenced this autumn, and we will continue to monitor developments in this space. In the meantime, please get in touch if you would like to discuss the Act in further detail.